Working Class can’t afford the American Dream in Pittsburgh (North Versailles: sale, cheap house)

[selltheburgh]

Originally Posted by jea6321

not if you do what myself and Guy have suggested and start out with a multi family. Then you have an advantage over both renting and buying a single family home. Also when you are done fixing it up to whatever extent and getting the rents to market rates over a few years, you either do it again or buy yourself a single family and keep the first for cashflow, equity build and tax advantages. Its a proven formula thats been working for a very long time. There are plenty of people that can vouch who started with no money and low paying jobs and have set them selves up for solid middle class and eventually higher lifestyles this way.

I've posted before that this is what I did. I bought a duplex. We lived in it while we renovated it. Then we rented one apartment out and that covered about half of the mortgage. I refinanced with a low rate and then took a home equity line of credit 3 years later and used that cash for my current "forever" home downpayment. Rents from the duplex cover all costs on it and half of my mortgage on my residence.

On the other hand, I just had to sink 15k into the one apartment because the kitchen was from 1940, it hadn't been painted in 12 years and the bedroom carpet was really worn, so I refinished the hardwood under it. That generated $175 more per month in rent, but a loss of 4 months in rent between tenants.

[RogersParkTransplant]

But again, we are so much better off here than many parts of the country. I come from a place where the "starter homes" are 1100 sq ft condos that sell for $600k. I'm actually fine with the cost of living in Pittsburgh vs the median income, for exactly all the reasons people are posting above -- without some market pressure we wouldn't have people fixing up the rundown cheap properties and making something nice out of them. It's the places where you truly can't live for $30k/year that have me worried, and I am glad I don't live in one of them.

[okaydorothy]

When we lived on Long island, we sank our first $30K into a house that cost $98K and was 1200 sq ft. It was a wreck. The basement was so wet and smelled but it was what we could afford. It was a typical 70's cape on a very small lot and also as it was in a village, our taxes were about $7K ($2K for village and $5K for town). We lived there for 8 years, our kids were born there so it had great memories. It was in a horrible school district, surrounded by a huge illegal population where spanish was the language. But it was what we could afford.

Fast forward 16 years, after living in it for 8, and renting it for 8, we sold it for over $200K. We had it paid off so fast and improved it a lot ; gutted it after horrible tenants. When we were buying it, we did the walk thru and we cried and said we would never be able to have our parents there as it was so bad. But it was what we could afford and that was that. But the way ; both or parents did come a few times and loved it.
So what I am saying is that the first property, may not be the beautiful dream house. But it takes very little to make a home. We loved that little house, but we outgrew it after the second child.

It can be done if you live within your means, take your time and don't rush.

[jfds]

Keep in mind the article that I originally posted does not specifically talk about home ownership. What it's really talking about it how working class people continue to fall further and further behind economically.

https://howmuch.net/articles/where-t...afford-to-live

Home ownership is only one aspect of this issue. The bigger issue, particularly for Pittsburgh is how low wages and limited opportunities for those without a four-year college degree are pushing the working class out altogether.

[jfds]

Originally Posted by okaydorothy

You know I must chime in here. People nowadays do not want to do anything themselves to make their financial lives better. I am hearing a lot of make the min wage higher. That makes no sense as all it will do is lessen employment as business will not hire more people and they will maybe hire them for less hours. It is not up to the government to make our lives better ; it is up to ourselves to make our lives better and more affordable.

The value of minimum wage has not kept pace with the rate of inflation since the 1980's.

https://howmuch.net/articles/minimum...etting-smaller

The whole point of the article was to show how the working class, despite working longer hours continues to fall further and further behind economically.

[PreservationPioneer]

Originally Posted by bluecarebear

You forgot to add the $$$ for repairs and updates. Old homes are money pits. Plus, when you go to resell the property in a couple of years, who is going to buy it for more than the original $20K in that neighborhood? Sometimes renting is the better life choice. Homeownership is as reliable a guide to success as a college degree.

It won't matter what the house sells for five years later, because you lived rent-free for five years, and pocketed the savings. Even factoring in repairs, I saved about $15-20,000 living in my row house in Stowe for four years. I bought a new car, and used my savings to put a down payment on a better house. Incidentally, then I sold the house for about exactly what I had into it, and used that money to buy a fixer upper in the city.

Truthfully, my mistake was buying a new car and getting a mortgage on another house. If I had stayed there, I'd have a lot more in the bank. Live and learn.

[wanderlust76]

Originally Posted by guy2073

You don't need a college degree, or incur any debt to live a great middle class lifestyle. I have one guy making 50k a year running one of my crews. The laborers union pays 45k a year plus full benefits, Carpenters union pays $33 an hour, electrians and plumbers pay $40 plus in the union. I have a few friends who are plumbing foreman who make 100k a year. There is also a shortage of workers.

This is discussed all of the time on other boards... the colleges got everyone to drink the Kool-Ade that makes you think going to school for 4 years and going in debt for 60k is the best and only way to live. The indoctrination and brainwashing starts as soon as middle school. There are tons of people with union jobs that make as much money as people with a Master's or higher even. Also you don't have to go to college right out of high school you can work for 5 years to save money and get some real world experience, then go to school.

[guy2073]

Originally Posted by wanderlust76

This is discussed all of the time on other boards... the colleges got everyone to drink the Kool-Ade that makes you think going to school for 4 years and going in debt for 60k is the best and only way to live. The indoctrination and brainwashing starts as soon as middle school. There are tons of people with union jobs that make as much money as people with a Master's or higher even. Also you don't have to go to college right out of high school you can work for 5 years to save money and get some real world experience, then go to school.

I have friends who make well over 100k a year as superintendents and project managers, in construction once you get to a certain level a company will most likely pay for your schooling.

[Goodjules]

Originally Posted by PreservationPioneer

It won't matter what the house sells for five years later, because you lived rent-free for five years, and pocketed the savings. Even factoring in repairs, I saved about $15-20,000 living in my row house in Stowe for four years. I bought a new car, and used my savings to put a down payment on a better house. Incidentally, then I sold the house for about exactly what I had into it, and used that money to buy a fixer upper in the city.

Truthfully, my mistake was buying a new car and getting a mortgage on another house. If I had stayed there, I'd have a lot more in the bank. Live and learn.

It all depends on what kind of appreciation you're seeing on the house with the mortgage. You may be making more than you would have in the other place. New cars depreciate quickly but might not cost as much to maintain as an older car that could need expensive repairs.

[bluecarebear]

Originally Posted by PreservationPioneer

It won't matter what the house sells for five years later

Tell that to my friends who have a house for sale sitting in a suddenly stagnant neighborhood.