Housing market trash

benXJ said:
That rent payment pays the insurance premium each month and sets some aside for deductibles. And the house should continue to appreciate. But yea.... having to deal with it sucks for the homeowner.
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What’s paying for the 100/night extended stay hotel?
What’s paying for the 8k HVAC system?
 
Ron said:
What’s paying for the 100/night extended stay hotel?
What’s paying for the 8k HVAC system?
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The rent payment.
 
drkelly said:
www.cnbc.com

Mortgage demand from homebuyers is now nearly half what it was a year ago

Sharply higher mortgage rates caused mortgage demand to drop to the lowest level since 1997.
www.cnbc.com www.cnbc.com
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"High interest rates are also weighing on home prices. While prices are still higher than they were a year ago, the gains are now slowing at a record pace. Homebuyers are also reconsidering their purchases. Pulte Group reported a 24% cancellation rate in its latest quarterly earnings report Tuesday and said it expected an even higher rate for the next quarter."
:eek:
 
"The median listing price was $427,000 in September, according to Realtor.com, up 13.9% from last year. At last week’s rate of 6.94%, a monthly payment would be $2,260 after offering at least 20% down."

So 20% down means financed amount is about $342k, and that $2260 does NOT include property taxes or homeowners insurance. And if you don't put 20% down, you're paying PMI on it too. So approaching $3000/month on a 30 year loan on a $400k house.




And I took a look at their graph for the median price. It is not surprising, yet truly shocking.
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benXJ said:
Why do you think people were building 1500sq ft 3 bed 2 bath for their forever homes 30 years ago? They got by just fine with 2 kids. The rows and rows of 3000 sq foot houses 5 feet from each other is sickening.
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They threw up a neighborhood in a farm field in Coflax where I don't think I could drive my 48" riding mower between many of the houses. Blows my mind that people are ok with that and choose to buy them.
 
jeepinmatt said:
"The median listing price was $427,000 in September, according to Realtor.com, up 13.9% from last year. At last week’s rate of 6.94%, a monthly payment would be $2,260 after offering at least 20% down."

So 20% down means financed amount is about $342k, and that $2260 does NOT include property taxes or homeowners insurance. And if you don't put 20% down, you're paying PMI on it too. So approaching $3000/month on a 30 year loan on a $400k house.




And I took a look at their graph for the median price. It is not surprising, yet truly shocking.
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yep, and thsi is where I struggle to understand inflationary control measures.
Inflation is high, so we raise interest rate - dramatically. This suddenly means that the cost of housing is about to go through the roof. People who already have a mortgage are ok, but anybody is a position where they have to move is pretty much f*cked and will be facing a much higher mortgage or rent, and thus must demand higher pay in order ot afford the move. How does that not also contribute to inflation?
 
RatLabGuy said:
yep, and thsi is where I struggle to understand inflationary control measures.
Inflation is high, so we raise interest rate - dramatically. This suddenly means that the cost of housing is about to go through the roof. People who already have a mortgage are ok, but anybody is a position where they have to move is pretty much f*cked and will be facing a much higher mortgage or rent, and thus must demand higher pay in order ot afford the move. How does that not also contribute to inflation?
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Because it tempers discretionary demand. Who really "needs" to move, but isnt moving for a better paying job or some other carrot? Raising interest rates to curb inflation is like amputating an arm with an ax rather than a scalpel, it works, but it's messy.
 
RatLabGuy said:
yep, and thsi is where I struggle to understand inflationary control measures.
Inflation is high, so we raise interest rate - dramatically. This suddenly means that the cost of housing is about to go through the roof. People who already have a mortgage are ok, but anybody is a position where they have to move is pretty much f*cked and will be facing a much higher mortgage or rent, and thus must demand higher pay in order ot afford the move. How does that not also contribute to inflation?
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Short term pain for long term gain. It is the only thing that can possibly rein in the price of housing and get it back down to the levels where it was just a couple of years ago(See Jeepinmatt's chart posted just above). Obviously there will be some that overpaid left holding that bag. Sucks to be them i guess, but good for those of us who will be looking to build/move in the coming years.
 
RatLabGuy said:
yep, and thsi is where I struggle to understand inflationary control measures.
Inflation is high, so we raise interest rate - dramatically. This suddenly means that the cost of housing is about to go through the roof. People who already have a mortgage are ok, but anybody is a position where they have to move is pretty much f*cked and will be facing a much higher mortgage or rent, and thus must demand higher pay in order ot afford the move. How does that not also contribute to inflation?
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Very simple. You're not being nearly conspiracy theorist enough. It moves the money into interest form so it goes to the banks, instead of home value form so it goes to the people. Who got bailouts last go round while still screwing people over?
 
Spence said:
Sucks to be them i guess, but good for those of us who will be looking to build/move in the coming years.
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But only if/when the interest rates come back down. Meanwhile everybody is screwed.
 
braxton357 said:
Low interest rates don't mean shit if a starter house is 600k. You're forgetting that 7-8% still is a "low" rate historically.
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Not really. Though people mine and your age like to think so. Reagan coincided with the highest mortgage interest rates in history.
Freddie Mac goes back to 1971.
Since 1971 there have been 8 years (all in a 10 year period) with double digit mortgage rates.
Conversely there have been 11 years with sub 5% interest rates.
7.5 is darn near the mean line


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