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I hate to play the "back when I was younger!!!" card, but those of us who grew up in high cost of living areas, we managed. My first place that I bought was a 1000sf condo with the thinnest walls I have ever encountered, and terrible neighbors. I'd hear one neighbor doing the deed with her many friends with benefits, and my other neighbor and his wife having domestic disputes almost every night.
I stayed there as long as I could stand to (about 3 years), cashed out with some equity, and put it toward a 1200 square foot house. Half of that 1200 square feet wasn't heated. Great starter home - it was tiny, but it was perfect for just me and my future wife who eventually moved in.
Stayed there for a few years, cashed out with some more equity, and moved up to a 2000sf house in a more desirable town with desirable schools. Having dual incomes helped some with this. Stayed there for five years, and then moved here.
We paid 395 for that house, and sold it for almost 500. If we had decided to stay in MA and wanted a bigger house, we could have pulled it off with the equity we had.
This was all in MA where the situation is a LOT worse than it is here. The point is, it's always possible, but you can't expect to move right into a big fancy house. Gotta work you way up, and I can guarantee it will all work out. That's the beauty of home ownership - equity and forced savings.
I hate to play the "back when I was younger!!!" card, but those of us who grew up in high cost of living areas, we managed. My first place that I bought was a 1000sf condo with the thinnest walls I have ever encountered, and terrible neighbors.
I stayed there as long as I could stand to (about 3 years), cashed out with some equity, and put it toward a 1200 square foot house. Great starter home - it was tiny, but it was perfect for just me and my future wife who eventually moved in.
Stayed there for a few years, cashed out with some more equity, and moved up to a 2000sf house in a more desirable town with desirable schools. Stayed there for five years, and then moved here.
We paid 395 for that house, and sold it for almost 500. If we had decided to stay in MA and wanted a bigger house, we could have pulled it off with the equity we had.
This was all in MA where the situation is a LOT worse than it is here. The point is, it's always possible, but you can't expect to move right into a big fancy house. Gotta work you way up, and I can guarantee it will all work out. That's the beauty of home ownership - equity.
That's what it takes. This simple philosophy has enabled many people move from borderline poverty to solid middle class.
I never thought that when I left the economic wasteland of Western NC that 15 years later, it would look like the more safe financial decision.
Prices there have gone up recently too, but much more manageable and a lot of locals have started to sell their homes because the pandemic brought in an influx of outside buyers.
I think much of the issue is as follows. House prices are up like 120% (inflation adjusted) since the 1960s, while wages haven't increased at nearly the same rate (15%, and really, as I mentioned in another thread a month back or so, that old "WTF happened in 1970/71" theory comes back into play.)
Most experts state that Price to Income ratios should max be around 2.6...anything beyond that creates sustainability issues.
National Average is a 5.4
Raleigh is at 3.5 (making it the 23rd most expensive metro in the country)
There are only six metro areas in the country below the 2.6 threshold; Pittsburg, Cleveland, OK City, St. Louis, Birmingham and Cincinnati.
Thanks for that. Very unusual , and honestly I’ve argued this in another thread but this gives more warrant to my belief ( which is supported by some experts ) that this isn’t necessarily a housing shortage . Something more is going on here . Is Springfield a growing area ? Raleigh isn’t special or unique , however due to pressures from new corporations moving in (Apple) our housing prices will jump considerably more than other cities . It makes me wonder . In places like San Francisco , the issue is the people who work their restaurants / schools / law enforcement can’t afford to live in the city . Wonder if that becomes an issue here eventually.
It is exactly a housing shortage. Total catch 22. Homeowners, like myself, aren't selling because then they become a buyer and it absolutely sucks now to be a buyer. So, I/we don't sell and thus contribute in our own little way to the lack of inventory out there for buyers. Of course, this causes the price of my home to go up, on paper, ........but so what.
The idea that I could sell and then "move up" here ain't happening. To think that I could sell here and then relocate and buy a "mansion" in a "lesser" market is not realistic either. I mean, it would really really have to be off the beaten path middle of no-where po-dunkville. That's why I gave the previous example of Lamar, CO; I lived there .... trust me.... it meets those criteria. No offense to anyone from Lamar; great folks, but it is... let's just say... a little isolated. Fun fact, it features the remnants of a Japanese U.S internment camp. The Gov relocated Japanese-Americans there during WWII because it was so isolated/secluded/desolate.
Somewhat related article I just saw in TBJ. Title of article Utah? Nebraska? First-time homebuyers, renters may start to look off the beaten path for housing
Not sure I agree with Utah in the title as it hints it is "affordable"; Utah, overall, not so much. I would sub Kansas maybe; but even there it would have to be off beaten path. Wichita ain't "cheap" any more.
Oh, and to answer your question, no, Springfield, IL is not a growing area. Maybe, I'd like to think, it's stagnant...possibly shrinking slightly. If shrinking, not so much as I would call it decaying though. The housing market is still insane there though, that's my point.
Last edited by ncrunner77; 01-10-2022 at 12:38 PM..
Reason: answer question
I think much of the issue is as follows. House prices are up like 120% (inflation adjusted) since the 1960s, while wages haven't increased at nearly the same rate (15%, and really, as I mentioned in another thread a month back or so, that old "WTF happened in 1970/71" theory comes back into play.)
Most experts state that Price to Income ratios should max be around 2.6...anything beyond that creates sustainability issues.
National Average is a 5.4
Raleigh is at 3.5 (making it the 23rd most expensive metro in the country)
There are only six metro areas in the country below the 2.6 threshold; Pittsburg, Cleveland, OK City, St. Louis, Birmingham and Cincinnati.
Yes this is definitely not helping affordably for hard working essential salt-of-the-earth type folks (teachers, EMTs, nurses, PD, FD, construction, repair). Unfortunately, they are going to be outbid by the foreign investors (any investor really.. doesn't have to be foreign) on that "starter home" and then charged rent = mortgage + mark-up...... when they could of had it just for the mortgage. Meanwhile, as renters, they are not building any equity. This has always been an issue but seems to be accelerating/getting worse in the global economy.
Yes this is definitely not helping affordably for hard working essential salt-of-the-earth type folks (teachers, EMTs, nurses, PD, FD, construction, repair). Unfortunately, they are going to be outbid by the foreign investors (any investor really.. doesn't have to be foreign) on that "starter home" and then charged rent = mortgage + mark-up...... when they could of had it just for the mortgage. Meanwhile, as renters, they are not building any equity. This has always been an issue but seems to be accelerating/getting worse in the global economy.
I know I sound alarmist , but I don’t think it’s crazy to say this will eventually all lead up to one big collapse.
I know I sound alarmist , but I don’t think it’s crazy to say this will eventually all lead up to one big collapse.
Perhaps. Don't know about a "collapse" like 2008 but price increases will slow/"adjust" as the pool of buyers who can afford to purchase housing is shrinking fast.
Keep in mind SFH ownership, as America has enjoyed, is a relative anomaly. In most of the world, with what we would like to think of as "housing" (i.e. not huts or such), most people rent... that is the norm. There is a relative few number of very wealthy folks who own everything and then rent it out. Even middle and upper middle rent... even what we would call high paid professionals.... they rent....that is just the norm.
Of course, some have a problem with only a small part of the population being landed gentry and controlling everything and they either have a revolution or move -as many folks did a couple hundred years ago when they left Europe in search of such opportunity (land ownership) in this great unsettled rustic land called America.
Perhaps. Don't know about a "collapse" like 2008 but price increases will slow/"adjust" as the pool of buyers who can afford to purchase housing is shrinking fast.
Keep in mind SFH ownership, as America has enjoyed, is a relative anomaly. In most of the world, with what we would like to think of as "housing" (i.e. not huts or such), most people rent... that is the norm. There is a relative few number of very wealthy folks who own everything and then rent it out. Even middle and upper middle rent... even what we would call high paid professionals.... they rent....that is just the norm.
Of course, some have a problem with only a small part of the population being landed gentry and controlling everything and they either have a revolution or move -as many folks did a couple hundred years ago when they left Europe in search of such opportunity (land ownership) in this great unsettled rustic land called America.
Wonder if we start seeing steady migration out of the US among some middle class professionals to places in Eastern Europe and South Asia that are relatively cheap and not necessarily impoverished . Worlds changing , and what was true to us last century will be different this one .
Wonder if we start seeing steady migration out of the US among some middle class professionals to places in Eastern Europe and South Asia that are relatively cheap and not necessarily impoverished . Worlds changing , and what was true to us last century will be different this one .
This is a good thought and a real possibility. Chang Mai Thailand > Wichita... maybe for some.
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