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If I had follow this logic I would be poor, never retire. Real estate is all about location. In my neighborhood a small condo like, cost about 3/4 of a million.
How much did it cost when you bought it, and when was that?
I wish houses were as cheap as 250k here. That would be nice.
Personally, I do hate the mentality of a home as an investment, because in part, it has been taken to the extreme here in California.
And on one hand I do agree that it sucks that prices are so high, however I could easily afford 250k, the problem is so can a lot of other people here. That's why the prices aren't that low.
I don't know, I think houses are fine to purchase, but I think a LOT of people overextend and place themselves in bad situations. I've been wanting to buy for over 10 years...and probably could have, but I would have been living in a precarious situation financially (and or just very house poor). So we're just taking our time, saving, because eventually we just want a place that we can do what we want.
Yawn. Excuse me, I'm sorry, that wasn't aimed at you. Yep, same song, different thread. I hope if he buys a house that it doesn't depreciate like a car does or need repairs.
All houses need repairs eventually. That's a given. And future prices are unknown to anyone. The key is to mitigate one's risk. I think we can all agree on that. Where we disagree is on how to mitigate that risk.
If your arguments and preferences work for you, one can't debate your personal style, but, housing price limits hardly fit a 'one-size-fits-all' approach.
If one lives in a smaller town, $250K likely represent a significant house in a desirable area, but, only a marginal house and area in another. Thus, what one pays for housing is dictated more by the market, rather than how much one would prefer to pay. For example, I look at what some Californian and New York residents pay for really small, basic homes, I think, "Yikes! -- I can't imagine paying that much for a home like that!" (but, I don't live in those areas).
Also, if one locks-in one's housing journey at the lower end of a market spectrum, the opportunity for future upward housing mobility, is limited by the relative appreciation of one's home (ie; if housing goes up 20% in an area, the $200K homeowner has gained $40K toward their next house, while the $500K homeowner has gained $100K). The only way to break out of that cycle is to move to another area with a lower cost housing market, or seriously downsize. But, if one's family grows and desirable school areas change ... or one changes jobs and distance or 'desirable neighborhood' or amenities become greater issues, one's options may be more limited.
It is not as though housing is like a boat or an automobile - which begins to depreciate the moment one opens the door. If it did, a stake-in-the-ground price approach might be more logical. (ie; "I absolutely refuse to pay more than $10K for a car!) However, with the exception of the 2007-08 housing bubble, real estate has always represented a relatively safe, growing asset.
Also, if one approaches housing like a trip to Home Depot, the fixed price might make sense (ie; "I want 2000 bricks, 500 2x4's, 100 pounds of nails, etc. ... and I'll only pay the going rate for these things"). But, as everyone knows, buying a house is more than buying doors, drywall and bricks.
(in 2016 dollars, of course)....Why I never want to pay more than $250K for a house......
If that's your decision, that's fine. As long as you understand that your price ceiling will limit where you can live.
Cost to build, parts and labor is about $100 a square foot for a plain ungarnished house with few upgrades. The cost of the land could be anything, depending upon where it is located. Out in the desert of Texas, you might pay $5,000. In one neighborhood where I am, a 1/4 acre lot will cost you $280,000 for the bare land, and one building site sold for over $1 million. Wells, septic, power hookups, water meters, wells, building permits, all of it varies in different locations.
So $250,00 will get you a house in some locations and it won't even get you a building site in a more desirable location. As long as OP has no desire to live in one of those high demand areas, $250,000 for a house can be done.
In Pangasinsan province in the Philippines (where its easy for a US Citizen to go live) you can buy a bamboo Kubo for about $300 and the land it sits on for about the $500.
Therefore, anyone paying anything over $800 for a roof over their head is absolutely nuts.
I'd rather live in an area where a 3 bedroom single family home costs $450k and I can make $150k a year vs. live in an area where the same 3 bedroom single family home costs $250k but I could only make $75k a year..
The guy in the $450k home is likely paying $35,000 a year in housing costs leaving him $115,000 left over.
The guy in the $250k home is likely paying $18,000 a year in housing costs leaving him $57,000 left over.
There is still the question of value and labor, even for those willing and able.
Ok, I'll admit that sort of depends on what is meant...but the base point still stands.
If the "base point" is that making pronouncements that bear no relation to reality is what you mean than, yeah, that stands, but to argue that there is any positive result of artificially limiting your own potential for income than you really are beyond help...
Not necessarily self fulfilling. The salaries and job opportunities can change between the time one enrolls in a given educational track and when one gets out. It is certainly true that many decide early on that they won't continue building their education, but that is not the only cause of career stagnation.Biggest cause for "career stagnation" is misunderstand of risk / reward scales...
There are plenty of middle class areas with decent people and reasonable housing prices...if you get out of the insanity that is the HCOL areas on both coasts...
So when all the stupid people move from the coasts...what will happen to housing prices where they move to?
So when all the stupid people move from the coasts...what will happen to housing prices where they move to?
What happened here in Southern Maryland, a quintupling plus of housing prices, clogged roads, whining about farms, whining about watermen on the Bay, whining about hunting, whining about fishing, demands to close DNR properties (paid for by hunters and fishermen) to allow for passive recreation, complaining about not having any big box stores.
I'm tired and you put me into a bad mood.
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