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I'm curious. Show us "the partial derivative of asset prices with respect to interest rates." I'd like to see what you're talking about.
Since the silliness of your SNAP snafus, I don't take your posts seriously any longer. Pulling up short at the mere mention of partial derivatives would only further undermine any notions of stature.
What was it worth in the first year after your purchase? Do you meanwhile believe that "holiday sales" are a valid sales incentive to consumers?
When I bought my first house, it was a lateral move. I specifically only looked for houses in the price range where the mortgage + PITA would be equivalent to my rent payment. In that case, it did pay off, but the fact I could deduct it did not influence my decision to buy... I bought because I wanted to own a house.
My next house was an upgrade. No, the deduction does not save me money now, because the property is simply more expensive.
Since the silliness of your SNAP snafus, I don't take your posts seriously any longer.
My snafu's? LOL! I'd be happy to revisit that topic if you wish, but it won't go any better for you now than it did the first time. But if you want to experience that kind of beating again, let's do it.
Quote:
Pulling up short at the mere mention of partial derivatives would only further undermine any notions of stature.
You brought it up. Failure to address it just shows everyone that you have no idea what you're talking about.
I don't see anything in there that supports the statement you made of middle class starting at the 200k in annual income
You are right, I am wrong. It does say that the middle class goes to $200,000 per single person and $250,000 per couple. Which is funny because many couples make similar incomes.
One report that I tagged did mention that middle income goes up to $400,000 for a family.
In my area I live in a high cost of living area. No way do we feel like we are middle class under $200,000 a year. That is my goal to get to the $200,000 mark. I remember growing up in the 80's and the magic number was $100,000 a year income. I can tell you that the mark has increased and after 30 years $200,000 is the goal.
"If you live in an expensive coastal city, $250,000 for a household isn’t exactly rich since about $65,000 of your income goes towards taxes. You can afford a car, take a couple weeks of vacation a year, max out your 401K and send your two children to private school. But if you ask any $250,000 a year couple whether they think they are rich, I’m sure most would privately tell you no. It costs $1.5 million here in San Francisco to get a decent house in a decent neighborhood. That’s 6X a $250,000 household salary."
More than likely why we have multiple families living in 3 bedroom homes, even in my neighborhood. Two homes with lots of people and these homes are not larger than 1,700 square feet. My wife and I have 4 kids at home still. We have 6 kids. We have a 4 bedroom home and wish now that we had a 5 bedroom home. If we feel like we need more room, imagine what the people in these other homes are feeling.
The reason for overloading a small home is because they need to spread the cost around. Both of those homes sold for over $500,000. This is something that I never saw when I was a kid. I grew up here. No one lived the way many people are living now. Too many people have accepted the fact that middle class is X when in reality you need Y to match the same middle class lifestyle that my parents had.
Is there an artificial inflation of house price because of the deduction allowance for mortgage interest?
I have read that construction cost is down and is one reason why huge McMansions are being built. If the deduction goes away would it bring real estate prices down? isn't that better in final analysis that demand will pick up, and more medium size houses in mid range price, which are now in short supply, will be built?
Yes, I think it's pretty well established that it inflates home prices. Economists from across the political spectrum have agreed on this for some time. This isn't to say there aren't other things that inflate home prices even more, such as easy loans and low down payments, zoning restrictions, etc.
When I bought my first house, it was a lateral move. I specifically only looked for houses in the price range where the mortgage + PITA would be equivalent to my rent payment. In that case, it did pay off, but the fact I could deduct it did not influence my decision to buy... I bought because I wanted to own a house.
And you were able to bid more for that house because the lion's share of your first year mortgage payments would be tax deductible. Just as you are presently able to buy more Xmas presents because of holiday sales.
rising rates are a sign of a strong economy. home prices tend to rise more often than not when rates do because of the stronger economy .historically our best appreciation is in the 6-8% range
What really happens more often than not is that housing prices rise when rates rise. Do you not understand that?
That was not my experience in the 80's when mortgage interest was 18% houses sat on the market for months. Generally the only ones that sold were those with assumable mortgages with a lower interest rate, and the bank's sure took care of that little 'glitch' in 1988 when loans negotiated after that date were no longer assumable. https://finance.yahoo.com/blogs/just...152241574.html
So, no I do not understand what you are saying. Interest rates and housing prices can rise simultaneously, but that requires consumers having confidence that there is upside potential in the purchase and that they can afford the home. If the folks who wrote this tax bill are hoping for a market correction from this, they might get that but not where it matters, because in overpriced markets like San Francisco and LA where all cash foreign investors are driving the price of homes and this won't change that one bit.
Where I live two and three generations are living in one home because of uncertainty about the housing market, and about future wage increases in their job. I'm not sure how removing deductions will encourage those young families to run out and buy a house, it seems to me like it will do the opposite. But maybe raising the GDP isn't the goal, but rather greasing the palms of the Kochs and the Mercers.
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