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We have three new neighbors this past spring and summer, all were first-time buyers, millennials with young kids moving from Seattle apartments, and both paid $750-800k
There are all kinds of first-time buyers. I would argue that buyers who can afford a 750K house don't need extra help.
Incidentally I feel the same way about coronavirus stimulus payments. They should be targeted at those who really need it, not, umm, me.
The last one, by the way, went partly to the Biden campaign, partly to the Salvation Army.
Well darn. Before he was elected, he was promising that everybody would get $15,000 for a down payment on a house. At least that is what was in his political ads running in Idaho.
Now, he has gone back on his word and reneged on his promise. Possibly, some people sold their votes for nothing but an empty promise.
Yours are true statements about what happened then. That housing crisis *was* solved through much more stringent credit and documentation policies which, as far as I know, are still in place, so I'm not sure it's the same thing.
We also had a $8000 first time home buyer tax credit in 2009 and 2010 which helped our housing market recover from that crash.
....
It may have helped a few markets but I'd argue it made the housing crash worse. It certainly did here.
What happened was at the expiration of the credit buyers that had plans to buy over the next 6 to 12 months rushed and bought before the deadline. Instead of creating new buyers, it pulled buyers forward and created a void in the normally busy summer months. People that had to sell had a shortage of buyers and were forced to drop the price, rent the home, or let it go into foreclosure. The price reductions snowballed and led to a massive price drop where we had previously been relatively stable.
In high cost cities like Boston, DC, Seattle and California, it's very normal for first time buyers to spend $1+ million on a starter house. A dual doctor, dual law couple in their late 20s/30 can do it. Just an example of how distorted the economy is between the high cost regions and everyday America.
I have friends in the Bay area/Socal who spent 1-2 M on their first property and other friends in Philadelphia and Baltimore who spent less than half that and still ended up with a comparable property.
Well property costs are very location sensitive. Size has nothing to do with the cost.
It’s “normal” for first time buyers to spend a million for a house IF they have that income and can qualify. What you said is too much of a blanket statement. On a million dollar house with 20% down you’re at a minimum of 4500 bucks for payment only. Property tax would run another 1k a month. So call it 5/6k for piti per month. You better be making serious dough to sign that up.
Why? Housing starts set a new record this past year. Most homes bought in 14 years if I recall. Doesn't appear it's a money problem.
Also wouldn't it make more sense to scale with the cost of living in the region? $15k will buy a lot more house in rural PA then in the big city.
And finally didn't they try something like this already. Making it easier for people to get home loans that probably had no business getting them... and that is how you get another 2008.
Well property costs are very location sensitive. Size has nothing to do with the cost.
It’s “normal” for first time buyers to spend a million for a house IF they have that income and can qualify. What you said is too much of a blanket statement. On a million dollar house with 20% down you’re at a minimum of 4500 bucks for payment only. Property tax would run another 1k a month. So call it 5/6k for piti per month. You better be making serious dough to sign that up.
True, normal is relative. Point remains there are quite a few first time buyers in high cost cities who are able to scrape together the income and funds for a $1+M house. A dual law/doctor/finance couple can easily hit 4-500k in HHI by the time they're 30. A senior associate at a big law firm with five years of post-law school can bring home 300k+ when bonuses are factored in. Many do typically have expensive graduate school debts to pay off but even with that factored in, coming up with 5-6k mortgage per month isn't unrealistic.
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