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Yes. My income has gone up over the time we've lived here so no only could I buy this house today at current value, given the current interest rates, I could probably about double it. It's important not to underestimate the effect interest rate has on the house you can purchase since most of the payment is actually interest.
I could easily purchase about $75000 more house today than I could have in 2015 - just based on interest rates alone. I just refied at 2.67 % fixed 30 yr with a chunk of cash out with a lower monthly payment, no less. I've never heard of interest rates this low.
While this is good math, I wonder how many people are stretching their purchasing power due to the ridiculously low rates so if the housing market corrects 20% then they are upside down and can't unload the house ..........interest rates don't help negative equity.
I have less debt, more income, bigger nest egg, and other real estate investment. I purchased this home with 10% down, did some cosmetic fix ups, then did a refinance to drop PMI. I could purchase it with 20% down right now no problem.
Would I buy it again? Not right now. I still believe there is a housing cool down just months away.
Yes, IF we liquidated all our savings and retirement funds, and bought it for cash Otherwise, no.
This is because we could not qualify for a loan as my husband lost his job in March due to COVID (more than half of the employees in his company was laid off), and he has not yet been able to find another one at age 64. However, as the loan closed in January, we were and are good. (This was a construction loan for our retirement home in Wisconsin. We sold and closed on our Colorado home on July 16, and closed and moved into our Wisconsin home on July 31.)
Our original plan was to have him work for another year and retire at 65.
Last edited by katharsis; 10-02-2020 at 07:56 AM..
We purchased our house in 2014 for $480k. Our house is now worth about $575-585k. We used a significant amount of funds as a down payment in 2014, so that our current remaining mortgage is $130k.
We would not be able to buy our home outright for the market value right now without selling it or our second property. (We don't have $575-585k worth of liquid assets) but we would be able to buy it with #2 and #3.
1.) Purchase your home outright, or
2.) Qualify for a mortgage with your current income, or
3.) Use any combination of down payment and financing ...
... to purchase your current principal residence at today's estimated value, given your income and resources today?
Nope.
Nope.
Nope.
Bought this house in 2006 and unexpectedly became disabled 10 days later. Had to reno the house to accommodate disability, which cost a lot of money but didn't add much to the market value of the house. Home prices have increased only slightly here but taxes have increased 60% in 5-6 years, adding substantially to monthly housing costs. I couldn't buy this house again, and I also can't afford to move.
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