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What a long winded waste of time. If I were to use 13% as an average, it would have taken an additional decade to get to your 1/2, and then to get to a 1/3...give me a break. Talk about embellishing.
You know, you don't read carefully. I didn't say 1/3 of the total (of 18%), as in 6%. I said "by 1/3". Which is to say 1/3 less. In the case of 18% that would be 12%. In the case of 12% that would be 8%.
Now, if you go look at your chart of historical rates, you'll see that the highest rate in the decade in question was one month at 18.45%. Most of the decade was averaging way below that. Without bothering to average all the months exactly I'd bet closer to 11% or maybe 12%?
The point is, you and the other poster were dismissing other people's arguments by throwing hyperbole. 15%. 18%. My arse. If you want to present yourself as a numbers guy and a hard-nosed realist, then live by the standards you are calling for from others.
You protest that people attribute to you things you've never said, yadda yadda yadda. But you just did the same above - and have in responding to my posts earlier, several times. Example: I didn't accuse nor even suggest GW Bush was conspiratorially complicit in 9/11. I pointed out that CEO's of companies and countries alike bear responsibilities for failures of their management / management teams during their tenure. In the case of 9/11 this would also go back to Bill Clinton. Both presidents failed to act on intelligence provided. They made judgement calls that the threats didn't rise to the level later proven.
You went on to tirade about me as a man without a country, religion, etc, "complaining about everythng". In fact I hadn't complained about anything at all in this thread. In fact, if you made a survey of my thousands of posts over the years you'd be hard pressed to ever find me complaining about much of anything except humorously that there are too many people in the state. Au contrare, i have a habit of lampooning complainers.
You just appear to fire from the hip wildly in many of your posts. And then ridicule others for being less than researched?
You know what. I'm really bored at this point and not interested in the least in sword fighting with you (in fact, I'm not even going to waste my time reading your comment). I find it humorous that a poster back on page 1 and 2 tells me I go off topic, and another poster says I go on for 20 pages. The reality of the situation is, most of the posters on this forum have ADD. They couldn't stay on topic if their lives depended on it. And once again, we are on a tangent that has absolutely nothing to do with the original topic (and that's painfully obvious). And shy of a little fun with Sav, I'm not the one going on for pages and pages. It's usually the group that feels life has been so hard for them and they must commiserate with each other. So a line gets drawn in the sand and it's like a warzone on this forum. And as much as people want to find little patches to cherry pick and say, but if you bought during this time or if you refinanced...blah, blah, blah. And yet, they seem to have lost touch with the fact (which Likealady and myself came to agreement on) that things didn't really start taking off here again until 2014 (ooh boy...we're into year 3). Anyone can cherry pick....gee, if you had bought in 2010 (see how that works?). Anyway, knock yourselves out. Whatever Hockey comes up with is going to take this thread to probably page 50 and it will have nothing to do with my original post. I'm going to go to Tahoe and enjoy myself. Enjoy your boat.
You know what. I'm really bored at this point and not interested in the least in sword fighting with you (in fact, I'm not even going to waste my time reading your comment). I find it humorous that a poster back on page 1 and 2 tells me I go off topic, and another poster says I go on for 20 pages. The reality of the situation is, most of the posters on this forum have ADD. They couldn't stay on topic if their lives depended on it. And once again, we are on a tangent that has absolutely nothing to do with the original topic (and that's painfully obvious). And shy of a little fun with Sav, I'm not the one going on for pages and pages. It's usually the group that feels life has been so hard for them and they must commiserate with each other. So a line gets drawn in the sand and it's like a warzone on this forum. And as much as people want to find little patches to cherry pick and say, but if you bought during this time or if you refinanced...blah, blah, blah. And yet, they seem to have lost touch with the fact (which Likealady and myself came to agreement on) that things didn't really start taking off here again until 2014 (ooh boy...we're into year 3). Anyone can cherry pick....gee, if you had bought in 2010 (see how that works?). Anyway, knock yourselves out. Whatever Hockey comes up with is going to take this thread to probably page 50 and it will have nothing to do with my original post. I'm going to go to Tahoe and enjoy myself. Enjoy your boat.
of course you're going to read my comment. And this one too. You're clearly such a self-absorbed self-admirer you can't skip anything that might be about you. What is also clear is, as I just previously pointed out, you read but without care and comprehension often. And when people call you on that obviousness, you bring out your backhoe and excavate and relocate the goalposts.
Interesting thing about this thread conversation is the referencing to "run the numbers" over and over never includes running the compensating factors such as in the comparisons of today's housing costs with those of the high interest 80's. To get the real picture you'd have to go much further than the simplistic comparisons argued so far. While the interest rates climbed during that decade, they also fell back. During that cycle housing appreciated, salaries increased, inflation ran lower than houses appreciated - and, most importantly, everyone who took out a high interest mortgage soon refinanced at 1/3 to 1/2 the rate they bought in at. All told, these 80's buyers were not for long paying the ratios claimed here.
I haven't done an analysis and not inclined to bother. So I don't know the actual, realistic comp. but it damn sure isn't as simple as a couple posters here are hollering about from both sides.
I'll give you that and don't disagree. However, if you bought a house from 1981-1990 the interest rates ranged from 10% to almost 17%. Also, there was this little thing called points which meant more back then. Many times it was over 2 points to obtain a mortgage, unlike today of no cost, no points loans.
In addition, real estate prices declined from 1990-1996 so many were unlikely to be able to refinance at that time so easily 10+ years could have gone by with that high interest rate. I agree that by 1997-2006 significant wealth was generated in real estate and many that bought back in the 1980's could have refinanced by 1998, but wow what a long time to have held onto that house to realize this. And even in 1998-1999 rates were still 7-8%.
I will be interested in what Hockey comes up. I do not care about running all those scenarios, but here is just one for example.
This home was bought in June 1989 for $169,500. It is now listed for $649,000. It will likely go over list price, so I'm going to say $750,000. "Running the numbers" quickly. Back in June 1989 one would have got a 10.2% interest rate with 2.1 points. Today, one can get a 3.625% rate with 0 points. I'm going to assume 100% financing just to simplify things. I know, I know, there are going to be pundits that say you need 20% down and it is so hard today to come up with $150k as a down payment. This is for illustrative purposes only.
Median income in Berkeley in 1989 was about $30k or $2,500/month. The PITI monthly payment on this house would have been $1,783 per month. That's a whopping 71.3% payment to income ratio (Front-end DTI).
Median income in Berkeley today is $100k/$8,333 per month. The PITI monthly payment on a $750k loan is $4,270. That 51.2% DTI. So how is today worse off than back in 1989? Let me assume $90k median income. THe DTI is 56.9%.
I know many will say this is just one example, that's why Hockey is "running the numbers". It will vary significantly in different areas, but the nonsense that people on here are pointing to that the entire Bay area is significantly different than many years ago is a fallacy. Neither could afford a mortgage in 1989 and today with the median income unless there was a significant down payment.
Ok, I'm done, too nice a day to be spending my time on the Internet.
I don't doubt your numbers but these days it would be near impossible for a $100k household to buy a $750k home. The bank wouldn't even loan you the money. And I think that's the problem... unless you can bring a lot of cash to the table, which the average person won't be able to, you're just shut out of the game. There aren't many options below $750k in that area.
Quote:
Originally Posted by TR95
I'll give you that and don't disagree. However, if you bought a house from 1981-1990 the interest rates ranged from 10% to almost 17%. Also, there was this little thing called points which meant more back then. Many times it was over 2 points to obtain a mortgage, unlike today of no cost, no points loans.
In addition, real estate prices declined from 1990-1996 so many were unlikely to be able to refinance at that time so easily 10+ years could have gone by with that high interest rate. I agree that by 1997-2006 significant wealth was generated in real estate and many that bought back in the 1980's could have refinanced by 1998, but wow what a long time to have held onto that house to realize this. And even in 1998-1999 rates were still 7-8%.
I will be interested in what Hockey comes up. I do not care about running all those scenarios, but here is just one for example.
This home was bought in June 1989 for $169,500. It is now listed for $649,000. It will likely go over list price, so I'm going to say $750,000. "Running the numbers" quickly. Back in June 1989 one would have got a 10.2% interest rate with 2.1 points. Today, one can get a 3.625% rate with 0 points. I'm going to assume 100% financing just to simplify things. I know, I know, there are going to be pundits that say you need 20% down and it is so hard today to come up with $150k as a down payment. This is for illustrative purposes only.
Median income in Berkeley in 1989 was about $30k or $2,500/month. The PITI monthly payment on this house would have been $1,783 per month. That's a whopping 71.3% payment to income ratio (Front-end DTI).
Median income in Berkeley today is $100k/$8,333 per month. The PITI monthly payment on a $750k loan is $4,270. That 51.2% DTI. So how is today worse off than back in 1989? Let me assume $90k median income. THe DTI is 56.9%.
I know many will say this is just one example, that's why Hockey is "running the numbers". It will vary significantly in different areas, but the nonsense that people on here are pointing to that the entire Bay area is significantly different than many years ago is a fallacy. Neither could afford a mortgage in 1989 and today with the median income unless there was a significant down payment.
Ok, I'm done, too nice a day to be spending my time on the Internet.
Even if you bring cash to the table, it's still not a guarantee you'll be able to buy a house. Bidding wars are the norm and people routinely pay 100k over list. There just isn't the inventory available, and unless you're willing to spend 700k plus, good freaking luck to you to find a decent home in a decent part of the Bay Area these days.
Even if you bring cash to the table, it's still not a guarantee you'll be able to buy a house. Bidding wars are the norm and people routinely pay 100k over list. There just isn't the inventory available, and unless you're willing to spend 700k plus, good freaking luck to you to find a decent home in a decent part of the Bay Area these days.
Bidding wars are hardly a new phenomenon. Been going on in the 70s, 80s, 90s, 2000s, 2010s and will continue if history repeats itself or rhymes. Curious as to how many people on here even lived in the 1980s or experienced it first hand. My guess is very few.
I never said they were a new phenomenon. But for a lot of people who can only afford to buy a house that's under 500k, they are pretty much screwed. Most people don't have that kind of cash lying around.
I found some sites that let you get like the last 5, or even 10, years - but honestly, that's not that worthwhile to me either since I'd like to look at long-term trends, ideally before the "hippie" boom and "tech" booms of the region (first in Silicon Valley and now in SF and SV) - although I'll take anything that goes back at least to the early 1990's.
Without this info, I'm not sure if I can really make any meaningful comparisons...
Does anyone know where I might be able to find historical housing cost info?
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