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Houses are readily affordable in flyover country. For example, in places like Indiana or Kansas you can buy a nice house for $150K or less.
However, most people don't want to live there. The jobs in those places have low pay.
For the other areas, the best deal is to find a house built in the 60s and re-do the interior with modern cabinets, flooring, and kitchen.
The problem I see with that is many times the guy down the street has turned his into a rental, and you'll see an un-kept yard with multiple old cars parked in the drive and on the street.
Hmmm. In 1996, as late twenty-somethings, my husband was making $80k as a Federal contractor, and I was making $45k working in marketing for a small, privately-owned manufacturer. We bought a three-bedroom/two-bath brick ranch built in 1988 on a quarter-acre in southwest Ohio for $115k or $10k less than our annual household income. The lot was just beautiful with mature oak trees, and the neighborhood was about a fifteen-minute commute to employment centers and a full-service airport (but not in the flight path, so noise was a non-issue). I just looked it up; the home has been nicely updated and is now worth about $135k. Still very affordable.
Last edited by randomparent; 07-15-2016 at 12:16 PM..
Hmmm. In 1996, as late twenty-somethings, my husband was making $80k as a Federal contractor, and I was making $45k working in marketing for a small, privately-owned manufacturer. We bought a three-bedroom/two-bath brick ranch built in 1988 on a quarter-acre in southwest Ohio for $115k or $10k less than our annual household income. The lot was just beautiful with mature oak trees, and the neighborhood was about a fifteen-minute commute to employment centers and a full-service airport (but not in the flight path, so noise was a non-issue). I just looked it up; the home has been nicely updated and is now worth about $135k. Still very affordable.
My mom's house in San Antonio is similar. It was worth about $100K 20 years ago. Really nice landscaped lot. It's worth about 135k now, basically it has kept up with inflation, that is all.
However, my experience is that cheap areas are cheap for a reason. I've never been to Ohio so I can't really comment on that area, but off the top of my head it does not strike me as a place people want to move to. Ohio's growth has been pretty slow according to the last census. It lost electoral votes.
As for San Antonio, it's cheap to live because it has a lot of poor people and is one of the most economically segregated cities in the country. There is a lot of correlation between the economic segregation and race. My mom's neighborhood used to be squarely middle class white. It is starting to become more of a working class hispanic/black neighborhood.
Colorado will likely have much greater economic growth than Kansas for some time to come, so much of it is a supply and demand issue as to why housing is appreciating much faster in CO.
this is what the "smart" guys are missing.
Institutional investing has driven up prices of homes across the nation. They now own a lot more than they have at anytime in my life. While many of the larger players appear to have stopped or greatly slowed buying they have tied up much of the stock that would normally have landed on the market for mom and pop landlords , first time buyers etc.
When the backlog of demand is sorted out what will happen? Do we really have enough buyers for $400k middle of nowhere home? Many of the lots for sale in cities across the US are listed higher than the peak of the bubble , they sit there waiting with no buyers, it is only a matter of time before they start to fall to the prisoners dilemma.
even the poster child cities that exemplify success are clearly topping out.
Will we plunge, I doubt it, but we may see local issues stagnate markets and declines in lower quality homes. If I owned an issue home I would sell it now. if I had some quality homes in strong locations that were profitable and easy to rent I might hold on and enjoy the cash flow.
So the problem is not the price of the house it is the price of the house exactly where you want it.
You have no concept of how the real estate market works. Got it.
the temp is clearly one factor that together with a bunch of others results in a low dollar cost house, but most likely incomes are low, resources are weak and the location is poor.
I think you know this already but just wanted to act clever.
My mom's house in San Antonio is similar. It was worth about $100K 20 years ago. Really nice landscaped lot. It's worth about 135k now, basically it has kept up with inflation, that is all.
However, my experience is that cheap areas are cheap for a reason. I've never been to Ohio so I can't really comment on that area, but off the top of my head it does not strike me as a place people want to move to. Ohio's growth has been pretty slow according to the last census. It lost electoral votes.
As for San Antonio, it's cheap to live because it has a lot of poor people and is one of the most economically segregated cities in the country. There is a lot of correlation between the economic segregation and race. My mom's neighborhood used to be squarely middle class white. It is starting to become more of a working class hispanic/black neighborhood.
Ohio is not typically a destination state in the same way that, say, Colorado is, but as I mentioned, that house cost less than our annual household income, and it was in a nice area with good schools. It may not have a been a flashy place to live, but it was solid, and our jobs were well-paying and stable. Not everyone can afford to live in a destination city and earn a six-figure income, and, fortunately, there are places for those folks, too. Don't knock Ohio until you've experienced it. Lots of great people live there.
Last edited by randomparent; 07-21-2016 at 06:51 PM..
You want prices to go down in California lets say? Easy to do. First the people of California need to change who they are voting for. Democrats run the state and have for a long long time. red tape to build any development can take decades to get thru. The cost to get a development started is passed on to the consumer. SOAR and other local ordinances along with environmentalist policies work to end developments. Projects have been dismantled, delayed, and scaled down because of liberal policies.
I don't think the issue is decided on party lines at the local level of government - there are plenty on both sides of the aisle that vote both ways but ultimately the NIMBY-ism is out of control. As long as property owners have more LOCAL civic participation, policy will tend to favor them. Which is precisely what we see - high property prices benefit those who ALREADY own property, but hurt those who WANT TO BUY in to the market.
Quote:
Originally Posted by SOON2BNSURPRISE
A builder wants to build lets say a 4,000 home development and ends up having to give up 80% of the land that they paid for to some nature conservancy for free, in order to get 400 homes built. On top of that before the homes can be built the developer has to allow for a school, parks, and other perks for the city that the project is in. All these costs are paid for in high cost homes. Many times the developer can not afford to build small homes that the average American can buy, but must build larger homes that can sell at a higher price point. On top of all those other hurdles, California cities make the builder do one of two things. The builder can offer 20% of the homes to be sold as low income homes or the builder can place funds in an account that the city can use to offer low income homes. These low income homes are subsidized by the cost of the higher priced homes. In essence, what you create is a system where the rich subsidize the poor.
This is the exception, not the rule. How often does a developer have to give up a large percentage of land for free? I'm sure it is not common.
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