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I agree. Not just baby boomers. Even my grandparents never downsized. They passed away in their 3 story, 4 bedroom house. This is precisely why I argue with people who claim that home ownership is an investment or some path to financial security. It is not.
I'll bet they didn't have to pay ever-rising rent on it.
I bought my house in 1985, paid it off. It rented for $750 a month (I know, because I was the tenant) and it would now go for $4000. I don't have $4000 to give away every month, but I have the house. How is that not a path to financial security?
I didn't say they should. I said the fact that they're not is a major hurdle for millennials trying to buy a home to raise a family in. That's all. Just venting frustration. Also, I agree with you that most people don't downsize ever, rendering the myth of "equity" mostly useless.
Seriously, you lack perspective. Every generation has hardships. May have been covered but did you know in the lat 70's interest rates were at 19 and 20% compared to 4.25% today? Even if prices are higher the rates are great. I bought my first home the price tanked 2 years after I bought it and I had to sell a rental property at a significant loss that I only owned for a year. It's regretful that you can't afford the home you'd like to have but you need to move past that and buy what you can afford or continue to rent. Make your decision and move forward. Regret the decisions you make, not the ones you don't make. Right now you aren't making a decision, you're just waiting for something to happen.
My problem with my parents is that they continually criticize my home and tell me to buy something bigger.
I will not b/c I refuse to be house poor, don't want to live in this small town any longer than I have to and this little house is actually in a good location - close to my kids schools.
They must be clones of my in-laws, lol. All we hear is how crazy we are for not buying a house... even though it will increase our monthly housing costs by at least $1000/month. If and when we decide that buying us right for us, it has to be what we need and want if it's worth taking such a big step. Our list is
3 bedrooms
1.5 or 2 bathrooms
Garage
Basement (partial or full)
Must not need major repairs (we're fine with repairs and updates that can be put off and done over time)
Preferably old (but functioning) kitchen and bathrooms
No more than 20 miles from my job
Under $12,000/year property taxes
^^Maybe 5 or 6 that I know of, but they were either too far from work or the property taxes were over $12k. Right now, the local market consists of zombie foreclosures, older homes that have been badly neglected, or new construction that is bigger than we want and can afford. We may eventually and grudgingly consider a condo at some point.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Choose well, and stay in it for a long time to come out ahead financially. A fixed mortgage today even if difficult to pay stays at that amount throughout the 30 year term while your salary (hopefully) goes up with any raises/promotions over the years. You also have the tax deduction for mortgage interest and taxes (as long as that doesn't get changed) which can be $20,000/year early in the term when almost all of the payments go to interest. Then your value keeps going up. Despite the drop in the recession our home of 23 years now is worth nearly 4 times what we paid for it, the payment is the same (just higher taxes) and my income is 3 times as high. It takes some years to overcome the cost of the down payment and closing costs.
^^Maybe 5 or 6 that I know of, but they were either too far from work or the property taxes were over $12k. Right now, the local market consists of zombie foreclosures, older homes that have been badly neglected, or new construction that is bigger than we want and can afford. We may eventually and grudgingly consider a condo at some point.
First, my apologies if my question seemed pointed; it was not intended to be.
Given that you say no houses have met all those criteria, may I suggest you consider your criteria again? In particular - and you'll have to help me out here - having a limit on property taxes seems to be too strict. And I have some familiarity with really high tax $ in the northeast.
I would suggest you consider total housing outlay. Maybe it doesn't happen, but if the house price is lower to offset the property tax outlay, then it's no different to your budget, right?
And in general, you'd rather stick with single-family, since they generally appreciate more than condos or townhomes (when all types are the same general location).
^^I know the $12k mark sounds arbitrary, but it's really about the fact that if the taxes are over $12k, that is the point where our taxes will be more than our mortgage and utilities put together (based on our price range and down payment), and they will likely continue the trend of increasing 2% per year. We just don't want to be homeowners badly enough to go from banking an extra $1000+ per month (more, as our childcare costs continue to decrease) to paying $1000+ per month for property taxes. Plus, for our section if the island (not as expensive because it is more desolate and undesirable for commuters), under $12k in taxes is very doable, as long as one avoids new construction (colloquial definition for anything less than 10 years old)
What the hell are you going on about? If you've worked, sacrificed and saved, then go buy yourself a freakin' house and quit blaming your problems on everyone else.
I'll gladly sell you my 1200 square foot, 100-year-old brick twin, but I have a feeling it wouldn't be good enough for you.
You're the one that needs to look up "entitled", btw ...
I bought my first house in 1992 - at the age of 33 - and paid 8.75% interest. I thought I was getting a great deal - and I was!
Bought our first house in 1979 with 11.5% interest. We were thrilled to get that as rates were rising daily.
It was a small, prefab all electric but it was what we could afford. Homeownership has been good for us.
Three houses later, paid for, before retirement. The key is to never pull equity and pay off that mortgage asap.
Bought our first house in 1979 with 11.5% interest. We were thrilled to get that as rates were rising daily.
It was a small, prefab all electric but it was what we could afford. Homeownership has been good for us.
Three houses later, paid for, before retirement. The key is to never pull equity and pay off that mortgage asap.
Yup, remember those days. Our parents bought first in late 1981 I think and IIRC the rate was 13.75% or so. My dad took me to the lawyer's office for closing and I recall the lawyer saying, "oh, you got a good rate!"
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