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Old 10-08-2015, 11:49 PM
 
825 posts, read 516,082 times
Reputation: 468

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That is right, I am getting there, and like most people, curious
anyways, I am just wondering how some people afford 500 600k homes if the average salary in CO is from 30 - 40k a year.

Even if one is to make 100k a year, most they can afford is a 300k home to live just fine.

Is there some trick, plan, tips for that kind of ownership? and I highly doubt there are over 200k + successful business owner...or are there?

as for me, im at the 100k range and only can afford 220k home (no debt, no cars) to live kind of freely. So I am a bit curious how families are jumping into 600k homes.

Oh, yeah! and sorry if my question offends you, but I am not going to random people and asking....hey, what do you do to afford this home.

So, thanks
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Old 10-09-2015, 12:53 AM
 
2,409 posts, read 2,619,940 times
Reputation: 1807
Quote:
Originally Posted by willc86 View Post

as for me, im at the 100k range and only can afford 220k home (no debt, no cars) to live kind of freely. So I am a bit curious how families are jumping into 600k homes.
If you by yourself make 6 figures, you CAN afford a lot more home. You simply don't WANT to. It is a personal choice.

Obviously if you impose your own standards on other people, you come to the absurd conclusion that there is no way people that earn less than you CAN afford more than you CHOOSE to.

Or are you posting this to brag about your lifestyle?
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Old 10-09-2015, 12:56 AM
 
13 posts, read 20,987 times
Reputation: 52
Quote:
Originally Posted by willc86 View Post
That is right, I am getting there, and like most people, curious
anyways, I am just wondering how some people afford 500 600k homes if the average salary in CO is from 30 - 40k a year.

Even if one is to make 100k a year, most they can afford is a 300k home to live just fine.

Is there some trick, plan, tips for that kind of ownership? and I highly doubt there are over 200k + successful business owner...or are there?

as for me, im at the 100k range and only can afford 220k home (no debt, no cars) to live kind of freely. So I am a bit curious how families are jumping into 600k homes.

Oh, yeah! and sorry if my question offends you, but I am not going to random people and asking....hey, what do you do to afford this home.

So, thanks
You must be a hit at the parties.
Quick reply to this message
 
Old 10-09-2015, 02:36 AM
 
Location: Washington State
18,044 posts, read 9,353,328 times
Reputation: 15392
The trick is qualifying for the loan....with interest rates very low, it lowers the affordability point. The other big factor is as long as housing prices continue to rise, one comes out ahead at a greater point the higher cost that you buy. However, when prices fall, many of those that bought those houses will be bankrupt. This is essentially what happened in 2008.

I'm too conservative and only 1 time bought a house that exceeded my income. Sometimes I wish I was more risky and had bought the dream house when my kids were younger.
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Old 10-09-2015, 05:00 AM
 
170 posts, read 162,402 times
Reputation: 154
I am seeing a lot of contracts were buyers are putting down $100k+ on high priced homes.
Saw one yesterday were they are putting down $600k on a $1.2 purchase.
That is how many are buying expensive homes these days.
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Old 10-09-2015, 05:39 AM
 
262 posts, read 309,613 times
Reputation: 251
Somehow people are able to get into a $600K house with average incomes, and it would be interesting to hear specific stories of how they did it.

Here are some possibilities:

1) Inheritance
2) Saving since a young age that provides big down payment
3) Willingness to give up security by living on the edge of financial ruin
4) Low interest rates available when ready to buy
5) Give up nice furniture, clothes, vacations, or cool car....
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Old 10-09-2015, 07:23 AM
 
2,409 posts, read 2,619,940 times
Reputation: 1807
Quote:
Originally Posted by Tall Traveler View Post
The trick is qualifying for the loan....with interest rates very low, it lowers the affordability point. The other big factor is as long as housing prices continue to rise, one comes out ahead at a greater point the higher cost that you buy. However, when prices fall, many of those that bought those houses will be bankrupt. This is essentially what happened in 2008.

I'm too conservative and only 1 time bought a house that exceeded my income. Sometimes I wish I was more risky and had bought the dream house when my kids were younger.
Can you explain how falling prices lead to bankruptcy?
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Old 10-09-2015, 07:29 AM
 
459 posts, read 670,236 times
Reputation: 726
Quote:
Originally Posted by flip33 View Post
Somehow people are able to get into a $600K house with average incomes, and it would be interesting to hear specific stories of how they did it.

Here are some possibilities:

1) Inheritance
2) Saving since a young age that provides big down payment
3) Willingness to give up security by living on the edge of financial ruin
4) Low interest rates available when ready to buy
5) Give up nice furniture, clothes, vacations, or cool car....
Kind of similar to #2 but one more possibility is making timely decisions to trade up using increased equity over time as home values rise, and mortgages are paid down. Which seems to be what I hear about more often.

However, Median Household income in CO is 59k, median home value in CO is 280k, and not everyone purchases their homes (66% of housing units in CO are owner occupied). So those people living alone (or sole family wage earner) making 30-40k and buying 600k homes I would assume are the exception not the rule.
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Old 10-09-2015, 07:45 AM
 
2,409 posts, read 2,619,940 times
Reputation: 1807
Quote:
Originally Posted by flip33 View Post
Somehow people are able to get into a $600K house with average incomes, and it would be interesting to hear specific stories of how they did it.
I am yet to meet anyone with average income of Colorado that buys a 600k home. Not saying those people do not exist, but if they do, they are very, very rare.

Unless you take into account those that had high paying jobs for a while, bought a house, then took jobs that pay less but are more satisfying. They're not that rare; I've met some of them.
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Old 10-09-2015, 07:52 AM
 
2,409 posts, read 2,619,940 times
Reputation: 1807
Quote:
Originally Posted by robertgoodman View Post
Kind of similar to #2 but one more possibility is making timely decisions to trade up using increased equity over time as home values rise, and mortgages are paid down. Which seems to be what I hear about more often.

However, Median Household income in CO is 59k, median home value in CO is 280k, and not everyone purchases their homes (66% of housing units in CO are owner occupied). So those people living alone (or sole family wage earner) making 30-40k and buying 600k homes I would assume are the exception not the rule.
At that income, to buy that expensive a house purely by leveraging and trading up, you'd have to change houses every few years for 50 years.
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