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Timing. That 85k (with nearly a 1/3 "borrowed" from parents) wouldn't even be enough to avoid PMI today on ovi's "starter" 400k house... 12-15k to close/move, floating ~330k mortgage (assuming you spend it all), and still have nothing leftover to nest egg or do any substantial reno with... Entitled - what a crock of $#@!.
I was 23 at the time with just a high school diploma. Expectations are much higher now. It's all fine and well but, the bottom line is people are still willing to struggle here and many aren't able to leave do to jobs. At 400k you can buy a decent home in many areas. Starter homes can be had for > 300k even in Nassau.
I think it's debatable that qualifies as a starter price point. Even pretending that number works as a starter, good luck chasing that in Nassau. As I've stated many times in the past, it is doable. I won't argue that. But it is fraught with compromise and you're likely talking sub-300 as a realistic starter for an average young family (even working in the city). Upwards of 400k is being fed mostly by people who already own/selling, getting gifted big downpayment, etc - special cases.
The "entitled" argument is tired... and I don't buy the SFO comparison one bit. We're talking suburbia here, not city. If you want to compare San Fran, use NYC itself. Those who have the homes now like to point out how young people are entitled to want a decent starter home in decent schools to start out. What they conveniently forget is that just 15-20 years ago they had the opportunity themselves... LI was much more affordable then and they were able to find something. Housing appreciation has outpaced everything in that time - selective amnesia if you ask me. Nobody was entitled back then, but they are now. Funny stuff.
There are a LOT of young people buying in the mid-300s still. FHA if needed. Simple as that. Ask any realtor and they will tell you those $ range homes go the fastest.
Who needs a starter home with a decent school? Exactly how old is young to you? I'm thinking 25 (a few years to save) and kids don't need good schools until 5 so that's way past age 30 before they need to get into a good district. By then financials should change if you're doing it right. There are many paths you must choose correctly to make it here, but you want everything right away, without working toward it, deserving over others who've done exactly the same? That's not entitlement?
We bought our starter 13 years ago and the home price is now $20k higher (bubble burst remember?) with $2k more taxes. Is that really that far out of reach NOW?
I know alot of kids graduating school coming back to LI. Living at home for 5-6 years making 30-40k and saving 90-100k for the down payment. That's how they are doing it these days.
But if you are moving here without that luxury its next to impossible.
Last edited by rocafeller05; 07-16-2015 at 07:03 AM..
There are a LOT of young people buying in the mid-300s still. FHA if needed. Simple as that. Ask any realtor and they will tell you those $ range homes go the fastest.
Who needs a starter home with a decent school? Exactly how old is young to you? I'm thinking 25 (a few years to save) and kids don't need good schools until 5 so that's way past age 30 before they need to get into a good district. By then financials should change if you're doing it right. There are many paths you must choose correctly to make it here, but you want everything right away, without working toward it, deserving over others who've done exactly the same? That's not entitlement?
We bought our starter 13 years ago and the home price is now $20k higher (bubble burst remember?) with $2k more taxes. Is that really that far out of reach NOW?
I'm not good at math, but I'm pretty sure $20k is much higher in terms of monthly payments. That's closing costs on some homes or at least half of it, right there. Plus, if you do FHA, they don't take PMI off now after the first 20%. You have to refinance out of it when it's worth it. That $2k in taxes will eventually become $4k and so on.
My generation isn't asking for everything right away. We just want a fair shot, we want everything that all generations that have come before have had. A shot at having a family and a home, even if it is later in life (which is a huge trend I noticed. Many people having children in their late 20's-early 30's). We want a shot at success at work.
Which, by the way, if you want to blame someone for teaching kids about entitlement and how much of a special snowflake they are, look to the parents. Participation medals, anyone?
I was 23 at the time with just a high school diploma. Expectations are much higher now. It's all fine and well but, the bottom line is people are still willing to struggle here and many aren't able to leave do to jobs. At 400k you can buy a decent home in many areas. Starter homes can be had for > 300k even in Nassau.
You're saying you bought a house big enough for 7 people at 23 and expectations are higher now? Really?
"Struggle" is a subjective term. Being given 35k and floating a mortgage payment of about 1,200 bucks (house large enough to offset costs with renters) doesn't sound like the least bit struggling to me. That sounds more like silver spoon and being handed it. In today's terms (where an average 23 year old is making less in overall terms than you did 15 years ago), I don't how you could consider the current state of things out of whack... and PS, your average 23 year old is saddled with college loans. Look at what's happened to the cost of an education in the past 15 years.
There are a LOT of young people buying in the mid-300s still. FHA if needed. Simple as that. Ask any realtor and they will tell you those $ range homes go the fastest.
Who needs a starter home with a decent school? Exactly how old is young to you? I'm thinking 25 (a few years to save) and kids don't need good schools until 5 so that's way past age 30 before they need to get into a good district. By then financials should change if you're doing it right. There are many paths you must choose correctly to make it here, but you want everything right away, without working toward it, deserving over others who've done exactly the same? That's not entitlement?
We bought our starter 13 years ago and the home price is now $20k higher (bubble burst remember?) with $2k more taxes. Is that really that far out of reach NOW?
FHA is the main thing driving the market right now... low downpayment. You're paying a point and carrying PMI for at least 10 years. It's more expensive than most people realize. Doing it right is more about living at home saving than anything else. Getting help is key to that.
Home values are driven by the school district. Buying a starter with the thought that you won't need the schools is the exact trap you do NOT want to get yourself into on LI. If you took this approach it certainly would explain why your home value hasn't increased much when the overall market has way outpaced you - see below, NYC area is in the Composite 10 in case you're wondering. It's back to about 2008 prices, well above 2002. It's a big mistake to purchase without schools in mind - financially, you would have done better renting in that time frame.
^ what does all that text prove? That you still want everything and don't want to do what it would take. If you want to be here as a youngin', you have to do what you can and none of that is unrecoverable if you have decent jobs. Nobody ever said it was easy in NY. You seem to want it to be. The avg time for staying in a house is 7 years. PERFECT.
We didn't need our home to appreciate, nor the good schools. At 25, we wanted a place for ourselves and be close to family. Starter home, $330k, now $350k. Does it matter if you are gifted any money or stayed home 5 years with 2 full-time incomes? None of it matters, because IT IS POSSIBLE EVEN TODAY. Just like magic, nearly a decade later we had kids but much higher salaries and could move onto a better district. This may be news to you but we never had to pay all $330k for the house - the difference from the sale rolls into the next loan which we pay with increasing salaries.
I'm not sure what you want me to admit - that it's hard to get started? No crap. It's hundreds of thousands in real life money.
I'm not good at math, but I'm pretty sure $20k is much higher in terms of monthly payments. That's closing costs on some homes or at least half of it, right there. Plus, if you do FHA, they don't take PMI off now after the first 20%. You have to refinance out of it when it's worth it. That $2k in taxes will eventually become $4k and so on.
My generation isn't asking for everything right away. We just want a fair shot, we want everything that all generations that have come before have had. A shot at having a family and a home, even if it is later in life (which is a huge trend I noticed. Many people having children in their late 20's-early 30's). We want a shot at success at work.
Which, by the way, if you want to blame someone for teaching kids about entitlement and how much of a special snowflake they are, look to the parents. Participation medals, anyone?
$20k appreciation in a house after more than a decade is minuscule.
What I want to know is why you don't feel you have a shot. Assuming you've had no hardships at home, did you move out at 18 and took on extra expenses? Did you go for extra education, out of state, etc.? Were you unable to find a full time job out of school? Did you major in women's studies or library information sciences? Did you gain a car payment along the way? Are you planning on paying for a downpayment on a $350k house all by yourself, without a partner? Or are you aiming at a $500k piece of property with good schools as a 20-something?
$20k appreciation in a house after more than a decade is minuscule.
What I want to know is why you don't feel you have a shot. Assuming you've had no hardships at home, did you move out at 18 and took on extra expenses? Did you go for extra education, out of state, etc.? Were you unable to find a full time job out of school? Did you major in women's studies or library information sciences? Are you planning on paying for a downpayment on a $350k house all by yourself, without a partner? Or are you aiming at a $500k piece of property with good schools as a 20-something?
Have you seen the job market? Have you seen the qualifications some jobs want? This isn't my situation, but I can tell you of quite a few of my friends and family who struggle to find jobs that are not only full time, but that pay what the job is worth. There are jobs that want a bachelor's degree to be a receptionist. They want you to have 5 years experience, just to sit and answer phones. No one wants to train on the job anymore, even though it would be effective to train an employee, to keep them around in the company for longer.
It doesn't matter what you major in, but what you make of the skills you learned while in college. You are going to learn basic liberal arts throughout your college career, no matter what you decide to study. I can tell you that I majored in something completely different then what my career focus is now, but I can also tell you of those people who did the right thing, who studied the right subject, but still struggle.
I am fortunate enough to own a home, but without the unfortunate death of my mother, I wouldn't be able to afford any kind of down payment. Even the small one that we did would be impossible.
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