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We put about 20% down and mortgage to gross income was probably around 2.3
I agree about "New" and "Newer" we looked at homes that were only 3-4 years old and the cheapo carpeting, cabinets, molding, tile, faucets all were showing signs of needing replacement.
We wound up buying a house that was about 20 years old. The bannister and railings are oak, the other wood work is hardwood....not pine or painted plastic. The doors throughout the house are SOLID not hollow etc etc etc.
Sure, I have replaced a fair amount of stuff that was older (faucets, range top etc.) but I knew all that going in.
These reasons but a million others are exactly why i would never purchase new or newer. Unless you custom build everything in those new development homes are builder grade that (IMO) does not last.
Sorry to get off topic, but I wasn't implying newer homes are built better than older homes. Structurally, I've always thought the pre-World War II homes are better built than newer ones.
3.5 times annual income. There is no other way to do it in NY unless you're REALLY loaded. Most people I know spend around 50% of their income on housing, be it rent or mortgage payment. Don't even ask about taxes.
is .83 my yearly income. I am a cheapskate, but I have a 2300 sq ft home that is over 100 years old.. Replaced all the carpet and did some additions but it is stlll the way to go for me. I like to have disposable income not interest payments
3.5 times annual income. There is no other way to do it in NY unless you're REALLY loaded. Most people I know spend around 50% of their income on housing, be it rent or mortgage payment. Don't even ask about taxes.
Similar in Boston, where I grew up. Newly married couples spend a large chunk of their budget on housing if they wish to buy. Being under the standard 28% ratio is almost impossible.
I know home prices in MSAs such as Boston, San Francisco, New York, and Miami are ridiculously high, and the median income doesn't make up the difference.
Surely it wasn't always like this though? I am under the assumption that the disparity between home prices and median income became so drastic during the last real estate boom.
Is that an inaccurate assumption?
For instance, my mother-in-law purchased a $120,000 home in metro Miami in 2000. Now, she makes probably 25-35% more, but her home is valued around $330,000. Wouldn't this type of scenario be found in other recently hot real estate markets? Surely the majority of homeowners in these areas weren't paying five times their annual salaries on their home 10 years ago.
I know home prices in MSAs such as Boston, San Francisco, New York, and Miami are ridiculously high, and the median income doesn't make up the difference.
Surely it wasn't always like this though? I am under the assumption that the disparity between home prices and median income became so drastic during the last real estate boom.
Is that an inaccurate assumption?
For instance, my mother-in-law purchased a $120,000 home in metro Miami in 2000. Now, she makes probably 25-35% more, but her home is valued around $330,000. Wouldn't this type of scenario be found in other recently hot real estate markets? Surely the majority of homeowners in these areas weren't paying five times their annual salaries on their home 10 years ago.
As far as I can remember, it's always been this way in Metro NYC area where I've lived my whole life. My parents were never able to buy a house here on their middle class salaries.
Taxes alone where I live in Long Island are $650/mo, in middle america, that's a mortgage payment.
I know home prices in MSAs such as Boston, San Francisco, New York, and Miami are ridiculously high, and the median income doesn't make up the difference.
Surely it wasn't always like this though? I am under the assumption that the disparity between home prices and median income became so drastic during the last real estate boom.
Is that an inaccurate assumption?
I'll defer to the PP as far as Metro NY goes since I have no experience there, other than to occasionally look up stats on Manhattan... since it always seems to get thrown into the mix when outrageous housing prices are discussed.
But I believe your assumption is indeed accurate for most areas.
I know it's true for much of Southern California.
Folks who bought prior to the insane RE price run-ups of recent years should be able to live comfortably despite the high overall cost of living in the area, since the single biggest factor that pushes those COL figures into the stratosphere is the high cost of housing.
That said, I just looked at a fairly recent report on housing out of Harvard; their numbers are from 2004, so it's my guess things have gotten worse as far as affordability goes in most places.
It certainly looks to me like plenty of folks were/are pushing the housing affordability envelope!
The info below is countrywide/statewide averages.
Across the United States:
31.9% of households spent more than 30% of their income on housing
14.4% of households spent more than 50% of their income on housing
In Cailifornia:
41.3 percent of households spent more than 30% of income on housing
19.4 percent of households spent more than 50% of income on housing
Of course that doesn't scare me nearly as much as the dismal savings rate in the US, especially of the soon to be retiring baby boomer generation.
But that's another thread....
Beware of new homes! Make sure you are in a good development with reputable builders. Most newer homes have been built quick & most during the boom when it was a matter of speed rather than quality. My brother bought a 1 yr old $650k home & a pipe in the wall burst 3 weeks after he took possession
While they come with warranties, etc. just keep in mind, newer isn't always better.
Hope you are looking for quality of the home & sound structure. A lot of brand new homes are overpriced due to people liking "brand new". Bells & whistles are just that...bells & whistles.
And things ALWAYS happen..no matter if new or old
Funny you should say that, looking at older homes a friendly contractor mentioned that it is always wiser to look at houses built during "off" times rather than boom times as the construction tends to be better.
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My mortgage
