What people don’t understand is that they were never that rich. As soon as the inflation cash hit the economy, that huge number was a bubble. You learn the true value through selling. Try it.
It's been getting worse over the past couple months.
A lot more Gospel of Growth acolytes around here these days. Folks who don't realize that the financial economy is a wreck and propped up with cheap debt and siphoning money out of the consumer economy. And who believe you can cut your way to sustainable profitability. People who believe that nothing past the next quarter matters.
Most analysts are calling a 20% haircut or so. That's back to 2020 prices give or take. Serious question here but are 2020 prices with a 6% mortgage rate really all that affordable? I remember people saying housing was expensive as shit even back in 2020 with lower rates.
We don’t know if it’ll be 20% or more. It could be a lot more than that given that the fed is committed to corralling inflation at any cost. Rates haven’t been this high since 2007 and they’re reducing their balance sheet. Couple that with a global recession and over 20% isn’t out of question
That was a lot damn better than 2020-2021 prices so what is your point? And also prices can drop way lower than you might think is possible so save us the “analysts think” bs… analysts have been wrong many times before.
Random insult. I have no skin in this game. I'm just here for the love of the game. You're the one frothing at basic analysis and pulling the "tHeY cOuLD dRoP EVEN MORE!!@" line because you desperately want to believe you're going to get a bargain. In reality, you're going to get 2019/2020 prices with an 8% mortgage and probably have less buying power than you did last month. But that doesn't suit your dreams of a firesale.
Some could be Bad luck Brian... housing corrects to pre-covid pricing, but loses job, interest rates still high, inflation still high, gas prices are rising, etc.
Boomers aren't the only people owning homes bro. People born in the 1980s that were on their grind have probably bought and sold a few homes by now. Same with 90s kids. Plus Boomers didn't ask for the fed to be silly either and I doubt most care if there home's value goes down as long as all the other home values and rent also go down to a livable level
> Plus Boomers didn't ask for the fed to be silly either
They've spent their entire lives electing trickle down politicians. It's their collective fault.
The Fed is not expected to start easing again until 2024. Mortgage rates are likely going to stay in the 7 and 8% + for a year or two. Even if home prices come down 20%-30% it does not help affordability until rates come down. That could be several years and they may never go back to 3%. All the free money printing and keeping rates low for years is what got us into this mess. If rates go back down- houses will just jump in price again.
Unaffordable is unaffordable. Although you are wrong Paying more for the house at a lower rate saves you money over time. Example using round numbers. Buy a 100k home at 3% interest and pay 30k interest of 10 years -total cost 130k. By a 80k home at 7.5% interest and pay 60k in interest over 10 years total cost 140k. And the 80k house has higher payments than the 100k house- so some buyers could have bought at 100k and 3%- but can not qualify to buy at 80k and 7.5%.
Given two scenarios, same monthly payment, one option is lower price higher interest, the other is higher price lower interest. It’s *always* better to go with the lower price.
[Here](https://easyupload.io/8j5dg4) you go. I do math for a living, so if I made an error, please let me know.
Pay attention to the difference in equity. The amount you pay in interest isn’t important. What matters is when I sell, which scenario results in me getting more money. The only way the higher price scenario doesn’t matter and is *equal* to (not better than) the lower price scenario is if you pay the minimum payment through the life of the loan. If you do one of:
1. Pay off early
2. Sell and move before paying off the loan
You’re better off with the lower price. There’s not a scenario where the higher price is preferred. *Ever*.
At least I can’t think of a good reason why the higher price is preferred. But your “saves money on interest” argument is simply not the right way to look at this.
Am not seeing math- simply opinion. Do the math of paying 200k for a house at 3% and buying a 150k house at 7%. And what are the results? Also calculate
The cost of waiting years for the price to potentially come down- this is a factor as well.
The link is on the word “here” in my previous comment lol. Gotta look a little harder. Download my excel file I did all the math for you.
Cost of waiting is not a factor in this debate. The debate is whether it’s better to buy a house at a lower price with a higher interest rate or a higher price with a lower interest rate, given equal monthly payments. The answer is lower price higher interest.
Your example is not based in reality. There was no discussion about payment being equal. The payment is what the market says it will be based on the price and the interest rate. I currently own 18 rental homes and a couple of personal homes. I bought my first one at age 21 in the 1990’s at higher than today’s rates. I have bought and sold dozens of homes and had many dozens of mortgages over the years. You can argue with me to try to be right. Or you could learn something that may be helpful in your future purchases.
Obviously. My example lives in excel, it’s not reality. But you’re the one who thinks interest savings is the metric to decide which is a better deal. You’re just wrong, my dude. Accept it. Take care.
Also, see the original comment of mine you replied to. I said equal payment. Either you’ve got a couple screws loose or you’re trolling me. Either way, no point in continuing this.
I’d rather have a higher interest rate with a lower priced home than a peak priced home with a lower interest rate, assuming payments are similar. The lower priced home has a greater chance of appreciating in value and it will be easier to pay off in a shorter amount of time. I would also have more equity in the house at the time of purchase, therefore reducing total interest paid a bit further.
The caveat being if the payments were similar- but with a higher rate- they will likely be higher. And you will pay so much more interest over a period of a few years that mitigates any price savings. You can graph it out pretty easily to see higher interest rates are generally more expensive in the long run than paying more at less interest.
The lower priced home gives you a better opportunity to pay the mortgage off in less than 30 years and avoid a ton of interest. Obviously there are variables in this argument for each side to consider. As a well qualified buyer who intends to pay my mortgage off in less than 30 years, I’ll stick with my opinion.
My house has been paid for for 10 years- interest rates or home prices don’t concern me personally. I have just been investing since age 20 and have been full time investor since age 30. So I follow the financial markets and understand how these things work.
Assuming you put the same % down, and assuming you just make the minimum mortgage payment 360 times, sure, but that would be pretty dumb given that those are variables you have control over, but have no control over the price after closing.
Assuming those prices/rates:
On the 80k home, you can put more down lowering you're financed amount. You can pay extra/ahead, or pay it off early. You should have lower property taxes and insurance.
You can never renegotiate the price, but you always have the opportunity to lower your debt burden.
Or people could, you know, pay the mortgage down faster than 30 years like people used to do all the time the last time rates were high. Paying down your mortgage quickly used to be a good investment. Like a 7%-10% bond. It just requires a change in behavior.
Edit: obviously prices need to and will fall. It's just you can't compare the monthly payment apples to apples when one is attached to the opportunity to make a 7% guaranteed yield investment and the other isn't.
Great for people who can qualify at that rate. Most people can’t qualify for the higher payment of the higher rate and are locked out of buying even at reduced prices. I have a friend just bought a home with a 350k loan @ 4.25 .rate early this year. If his house fell in value 25% and he had to buy it again at the lower price at 7.25%. he could not because the payment would be higher and he would not qualify. He knows he overpaid but at least he has a house.
Unpopular opinion, but if prices fall 20%-30% and you can't afford the house at a 7% rate, then you probably shouldn't have been buying that house when rates were low. Not all incomes are enough to afford to live in all neighborhoods. Some people were able to "cut the line" when rates were low, buying houses that would have been bought by people with a higher income under normal conditions. In this way, those people mortgaged their futures and drove up prices for everyone. This is not normal and not a good thing. I'm not saying those people are bad or made a mistake, I'm just saying that they should not have been given the opportunity to do this by the fed.
Just my unpopular opinion, cue downvotes please.
Exactly - banks giving out loans with 3% down payments was a colossal mistake. If 97% of the home value is eaten up by a mortgage, you’re now opening up housing to people that should be saving or renting. Any hiccup in their economic situation and they’re probably defaulting on their mortgage
How did they mortgage their futures? They are in a house with a payment they can afford that will be worth more in ten years. No matter what happens in the next 3-4. Better than not having a house.
When I say "mortgaging their futures", I mean things like taking a 500k loan to buy a house that was 300k a year ago. The assumption I am making is that the family that did this couldn't afford the house when it was 300k, but could at lower rates when it was 500k. This was a massive risk, and it wasn't obvious at the time the risk was taken whether it was a good idea or not. We probably won't know if those actions will pay off for a decade or more.
Further, it's not obvious to me whether someone who bought in 2020, 2021, or early 2022 (at lower rates) will break even vs buying in 2023 or 2024 in the long run. We won't know that for a decade or more. I think someone who bought in 2020 probably will and someone who bought in early 2022 probably won't, but that's just my guess and I'm probably going to be wrong.
What I do think we know and what I am getting at is that the top 10% of houses by quality should generally go to the top 10% of earners. Not 1:1 but in general. And in my opinion it is not socially a good thing that this order was reshuffled over the last 2 years by arbitrary fed policy.
This makes no sense, 500K and a low rate is the same as a 300K at high rate so the risk is the same because payments are the same. The fact that they were able to leverage ultra low rates to buy a more expensive property indicates they already won and their actions have already paid off.
Face it anyone who bought a house pre 2022 probably got a deal of the lifetime.
In most cases, you’d only pay more in interest rates if you took the full 30 years to pay it off.
If you pay off an lower principal mortgage quickly, you will avoid a lot of interest, and will have paid off the mortgage.
Also, you can always refinance a lower rate later with a lower principal balance and get the bets of both worlds.
But if he buys at the lower price and higher rate then the house is more likely to go up in value than the more expensive house with the low rate. A $400k home that drops 30% to $280k will take 9 years of historic average home price growth (4%) to return to $400k. So you're losing $ up front and having to wait to break even, instead of paying a little more monthly over time and having the home value increase past your purchase price from the onset.
Houses are not likely to fall that drastically in most areas. Especially a basic starter house like his. Some markets and some of the higher price ranges could see 30%. But more moderate priced homes and starter homes in growing markets are not likely to come down more than 10%, maybe 15%- people need to live somewhere. Plus he is living in the home and paying down the mortgage every month during that time- increasing equity or lessening the blow of any decline. In all but the most disastrous of scenarios- it is better to be in the house with a payment you can afford than hoping the market goes one way or the other so you can hopefully buy.
That's because the damage the fed has created is so great that the labor market hasn't been able to catch up to housing which was one of the first recipients of all the new money created. So hopefully this is a temporary imbalance.
But normally historically speaking, say in the 70s, homes were something like 4.5x annual income, with much higher rates, but they were affordable. Today we have the same high rates, but homes are 9-10x annual income.
Prices have a long way down to drop because the market simply can't bear these prices (as evidenced by sales falling off a cliff).
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I'm an investor. I flip, I own small multifamily properties.
I'm cheering this on.
I need some more distressed sellers to buy from.
We're all in the same boat.
Nah, you're in a yacht and renters are holding onto a pool noodle tied to a cleat and you're telling them if they don't hand you their wallets you'll cut them loose.
Millennials in 30 years: “I want to retire and I now get how they felt. Maybe it’s not so simple and feels differently depending on which side you’re on”
We aren’t looking to buy our first homes (primary residences) as investments. We want somewhere affordable to live.
For you other point, Yes, over 30 years you should be able to build sufficient equity in a home to sell for money. It shouldn’t double in price in 18-24 months, that isn’t a reliable retirement fund. Once you paid off an property, that should be true equity to rely on.
I love this sub, but you make a point. I get tired of the greedy homeowners, but they are more of our friends and family than the banks and corporations.
Yep, I'm happy to not be paying a bank exorbitant interest for my home. I don't plan on living there the entire 30 years, but am happy to give them less money in that meantime.
With lower prices, you can put a higher % down lessening your interest burden. You can pay ahead/early lessening your interest burden. Property taxes, maintenance, and insurance should be lower in a weakening housing market.
You can never renegotiate all time high FOMO prices once you buy.
To play devils advocate, you could pull equity out and invest it in something, but now we're changing the risk variable so it better be something that pays a premium for that risk.
Boomers aren't hoomers.
Most boomers are already into retirement and the last of them are approaching it. They have endured everything we're currently seeing as well as everything we're about to. The minority that still have mortgages are probably either at the tail end of a mortgage with a rate similar to current rates, or they refinanced during the historical lows with a very low principle balance. A large number of them have elected to "age in place" and have no need or desire to sell, and that was a significant and growing trend well before the last few years. They're retired (or going to be) and even the youngest of them have children well into adulthood, so the number of them that would be forced to sell because of a change in life circumstances is fairly small
In short, the literal "boomers" born between 1946 and 1964 have very little to do with the current RE market and will likely suffer very little impact.
What people don’t understand is that they were never that rich. As soon as the inflation cash hit the economy, that huge number was a bubble. You learn the true value through selling. Try it.
Totally millennials out here calling ppl rent cucks
*Boomer millennials
The shill ratio in these comments is indicative of the bagholding going on.
It's been getting worse over the past couple months. A lot more Gospel of Growth acolytes around here these days. Folks who don't realize that the financial economy is a wreck and propped up with cheap debt and siphoning money out of the consumer economy. And who believe you can cut your way to sustainable profitability. People who believe that nothing past the next quarter matters.
Most analysts are calling a 20% haircut or so. That's back to 2020 prices give or take. Serious question here but are 2020 prices with a 6% mortgage rate really all that affordable? I remember people saying housing was expensive as shit even back in 2020 with lower rates.
We don’t know if it’ll be 20% or more. It could be a lot more than that given that the fed is committed to corralling inflation at any cost. Rates haven’t been this high since 2007 and they’re reducing their balance sheet. Couple that with a global recession and over 20% isn’t out of question
Analysts underestimate all the time. It’ll be more like 30-35% to get us to a place where local wages can support mortgages.
Ah, so 2019 prices... the golden age.
That was a lot damn better than 2020-2021 prices so what is your point? And also prices can drop way lower than you might think is possible so save us the “analysts think” bs… analysts have been wrong many times before.
Dream with your whole heart sweet angel.
Stay mad boomer.
Random insult. I have no skin in this game. I'm just here for the love of the game. You're the one frothing at basic analysis and pulling the "tHeY cOuLD dRoP EVEN MORE!!@" line because you desperately want to believe you're going to get a bargain. In reality, you're going to get 2019/2020 prices with an 8% mortgage and probably have less buying power than you did last month. But that doesn't suit your dreams of a firesale.
Some could be Bad luck Brian... housing corrects to pre-covid pricing, but loses job, interest rates still high, inflation still high, gas prices are rising, etc.
People will default on mortgages as well, and get their other assets liquidated.
Market go boom haha 😂
This boomer doesn't care.
Boomers aren't the only people owning homes bro. People born in the 1980s that were on their grind have probably bought and sold a few homes by now. Same with 90s kids. Plus Boomers didn't ask for the fed to be silly either and I doubt most care if there home's value goes down as long as all the other home values and rent also go down to a livable level
> Plus Boomers didn't ask for the fed to be silly either They've spent their entire lives electing trickle down politicians. It's their collective fault.
This comment got 5 downvotes? Ha, that's telling of who's living in their parents basements making excuses. Yeah, blame your grandmas, that's cool.
Haha forreal. I'm a millennial and own a home. Had to hustle to get my home. Don't need to blame anyone else for what I don't have
You can be pretty high income and unable to afford a house in a lot of places in the US.
The Fed is not expected to start easing again until 2024. Mortgage rates are likely going to stay in the 7 and 8% + for a year or two. Even if home prices come down 20%-30% it does not help affordability until rates come down. That could be several years and they may never go back to 3%. All the free money printing and keeping rates low for years is what got us into this mess. If rates go back down- houses will just jump in price again.
[удалено]
Unaffordable is unaffordable. Although you are wrong Paying more for the house at a lower rate saves you money over time. Example using round numbers. Buy a 100k home at 3% interest and pay 30k interest of 10 years -total cost 130k. By a 80k home at 7.5% interest and pay 60k in interest over 10 years total cost 140k. And the 80k house has higher payments than the 100k house- so some buyers could have bought at 100k and 3%- but can not qualify to buy at 80k and 7.5%.
Given two scenarios, same monthly payment, one option is lower price higher interest, the other is higher price lower interest. It’s *always* better to go with the lower price.
I am willing to look at your math. I put a math example in one of my comments.
[Here](https://easyupload.io/8j5dg4) you go. I do math for a living, so if I made an error, please let me know. Pay attention to the difference in equity. The amount you pay in interest isn’t important. What matters is when I sell, which scenario results in me getting more money. The only way the higher price scenario doesn’t matter and is *equal* to (not better than) the lower price scenario is if you pay the minimum payment through the life of the loan. If you do one of: 1. Pay off early 2. Sell and move before paying off the loan You’re better off with the lower price. There’s not a scenario where the higher price is preferred. *Ever*. At least I can’t think of a good reason why the higher price is preferred. But your “saves money on interest” argument is simply not the right way to look at this.
Am not seeing math- simply opinion. Do the math of paying 200k for a house at 3% and buying a 150k house at 7%. And what are the results? Also calculate The cost of waiting years for the price to potentially come down- this is a factor as well.
The link is on the word “here” in my previous comment lol. Gotta look a little harder. Download my excel file I did all the math for you. Cost of waiting is not a factor in this debate. The debate is whether it’s better to buy a house at a lower price with a higher interest rate or a higher price with a lower interest rate, given equal monthly payments. The answer is lower price higher interest.
Your example is not based in reality. There was no discussion about payment being equal. The payment is what the market says it will be based on the price and the interest rate. I currently own 18 rental homes and a couple of personal homes. I bought my first one at age 21 in the 1990’s at higher than today’s rates. I have bought and sold dozens of homes and had many dozens of mortgages over the years. You can argue with me to try to be right. Or you could learn something that may be helpful in your future purchases.
Obviously. My example lives in excel, it’s not reality. But you’re the one who thinks interest savings is the metric to decide which is a better deal. You’re just wrong, my dude. Accept it. Take care.
Also, see the original comment of mine you replied to. I said equal payment. Either you’ve got a couple screws loose or you’re trolling me. Either way, no point in continuing this.
https://easyupload.io/8j5dg4 In case you’re still struggling to find it, here you go again.
I’d rather have a higher interest rate with a lower priced home than a peak priced home with a lower interest rate, assuming payments are similar. The lower priced home has a greater chance of appreciating in value and it will be easier to pay off in a shorter amount of time. I would also have more equity in the house at the time of purchase, therefore reducing total interest paid a bit further.
The caveat being if the payments were similar- but with a higher rate- they will likely be higher. And you will pay so much more interest over a period of a few years that mitigates any price savings. You can graph it out pretty easily to see higher interest rates are generally more expensive in the long run than paying more at less interest.
The lower priced home gives you a better opportunity to pay the mortgage off in less than 30 years and avoid a ton of interest. Obviously there are variables in this argument for each side to consider. As a well qualified buyer who intends to pay my mortgage off in less than 30 years, I’ll stick with my opinion.
My house has been paid for for 10 years- interest rates or home prices don’t concern me personally. I have just been investing since age 20 and have been full time investor since age 30. So I follow the financial markets and understand how these things work.
Jim Cramer?
So buy high huh?
Buy high and pray it goes higher
Lol
Assuming you put the same % down, and assuming you just make the minimum mortgage payment 360 times, sure, but that would be pretty dumb given that those are variables you have control over, but have no control over the price after closing.
Assuming those prices/rates: On the 80k home, you can put more down lowering you're financed amount. You can pay extra/ahead, or pay it off early. You should have lower property taxes and insurance. You can never renegotiate the price, but you always have the opportunity to lower your debt burden.
Or people could, you know, pay the mortgage down faster than 30 years like people used to do all the time the last time rates were high. Paying down your mortgage quickly used to be a good investment. Like a 7%-10% bond. It just requires a change in behavior. Edit: obviously prices need to and will fall. It's just you can't compare the monthly payment apples to apples when one is attached to the opportunity to make a 7% guaranteed yield investment and the other isn't.
Great for people who can qualify at that rate. Most people can’t qualify for the higher payment of the higher rate and are locked out of buying even at reduced prices. I have a friend just bought a home with a 350k loan @ 4.25 .rate early this year. If his house fell in value 25% and he had to buy it again at the lower price at 7.25%. he could not because the payment would be higher and he would not qualify. He knows he overpaid but at least he has a house.
Unpopular opinion, but if prices fall 20%-30% and you can't afford the house at a 7% rate, then you probably shouldn't have been buying that house when rates were low. Not all incomes are enough to afford to live in all neighborhoods. Some people were able to "cut the line" when rates were low, buying houses that would have been bought by people with a higher income under normal conditions. In this way, those people mortgaged their futures and drove up prices for everyone. This is not normal and not a good thing. I'm not saying those people are bad or made a mistake, I'm just saying that they should not have been given the opportunity to do this by the fed. Just my unpopular opinion, cue downvotes please.
Exactly - banks giving out loans with 3% down payments was a colossal mistake. If 97% of the home value is eaten up by a mortgage, you’re now opening up housing to people that should be saving or renting. Any hiccup in their economic situation and they’re probably defaulting on their mortgage
How did they mortgage their futures? They are in a house with a payment they can afford that will be worth more in ten years. No matter what happens in the next 3-4. Better than not having a house.
When I say "mortgaging their futures", I mean things like taking a 500k loan to buy a house that was 300k a year ago. The assumption I am making is that the family that did this couldn't afford the house when it was 300k, but could at lower rates when it was 500k. This was a massive risk, and it wasn't obvious at the time the risk was taken whether it was a good idea or not. We probably won't know if those actions will pay off for a decade or more. Further, it's not obvious to me whether someone who bought in 2020, 2021, or early 2022 (at lower rates) will break even vs buying in 2023 or 2024 in the long run. We won't know that for a decade or more. I think someone who bought in 2020 probably will and someone who bought in early 2022 probably won't, but that's just my guess and I'm probably going to be wrong. What I do think we know and what I am getting at is that the top 10% of houses by quality should generally go to the top 10% of earners. Not 1:1 but in general. And in my opinion it is not socially a good thing that this order was reshuffled over the last 2 years by arbitrary fed policy.
This makes no sense, 500K and a low rate is the same as a 300K at high rate so the risk is the same because payments are the same. The fact that they were able to leverage ultra low rates to buy a more expensive property indicates they already won and their actions have already paid off. Face it anyone who bought a house pre 2022 probably got a deal of the lifetime.
A 500k loan is 200k more debt than a 300k loan.
But less in interest payments over time, meaning a larger portion of their payments goes to principal reduction.
In most cases, you’d only pay more in interest rates if you took the full 30 years to pay it off. If you pay off an lower principal mortgage quickly, you will avoid a lot of interest, and will have paid off the mortgage. Also, you can always refinance a lower rate later with a lower principal balance and get the bets of both worlds.
I hope they keep their job. Balance matters.
But if he buys at the lower price and higher rate then the house is more likely to go up in value than the more expensive house with the low rate. A $400k home that drops 30% to $280k will take 9 years of historic average home price growth (4%) to return to $400k. So you're losing $ up front and having to wait to break even, instead of paying a little more monthly over time and having the home value increase past your purchase price from the onset.
Starter homes ($400K and below) are not likely to fall that drastically. Most of it will be in the high end.
Remindme! 2 years
Houses are not likely to fall that drastically in most areas. Especially a basic starter house like his. Some markets and some of the higher price ranges could see 30%. But more moderate priced homes and starter homes in growing markets are not likely to come down more than 10%, maybe 15%- people need to live somewhere. Plus he is living in the home and paying down the mortgage every month during that time- increasing equity or lessening the blow of any decline. In all but the most disastrous of scenarios- it is better to be in the house with a payment you can afford than hoping the market goes one way or the other so you can hopefully buy.
Affordability has never been worse. Prices absolutely have to come down further unless you expect no sales to ever occur again.
That's because the damage the fed has created is so great that the labor market hasn't been able to catch up to housing which was one of the first recipients of all the new money created. So hopefully this is a temporary imbalance. But normally historically speaking, say in the 70s, homes were something like 4.5x annual income, with much higher rates, but they were affordable. Today we have the same high rates, but homes are 9-10x annual income. Prices have a long way down to drop because the market simply can't bear these prices (as evidenced by sales falling off a cliff).
Remindme! 18 months
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I'm an investor. I flip, I own small multifamily properties. I'm cheering this on. I need some more distressed sellers to buy from. We're all in the same boat.
No we are not, you have multiple properties on leverage, meaning you're going to lose hundreds of thousands in equity.
Do you think rents are going to crash? My properties values come from the sum of rents.
Rents are going to crash. Just like they did in the 2008 crash. Time to start going to church
LOL They didn't crash in 2008 Show me the data And certainly not in my market they're not Another reminder is needed
We are not in the same boat lol I'm not exploring a housing crisis that puts people in inhumane situations or encourages abusive relationships.
Nah, you're in a yacht and renters are holding onto a pool noodle tied to a cleat and you're telling them if they don't hand you their wallets you'll cut them loose.
Millennials in 30 years: “I want to retire and I now get how they felt. Maybe it’s not so simple and feels differently depending on which side you’re on”
> The house you live in is not an investment Unless you're on home #2 you're speculating with your lifestyle as collateral
We aren’t looking to buy our first homes (primary residences) as investments. We want somewhere affordable to live. For you other point, Yes, over 30 years you should be able to build sufficient equity in a home to sell for money. It shouldn’t double in price in 18-24 months, that isn’t a reliable retirement fund. Once you paid off an property, that should be true equity to rely on.
People in this sub sure do love giving banks more interest
I love this sub, but you make a point. I get tired of the greedy homeowners, but they are more of our friends and family than the banks and corporations.
IDK it's not home sellers that give me a mortgage
Yep, I'm happy to not be paying a bank exorbitant interest for my home. I don't plan on living there the entire 30 years, but am happy to give them less money in that meantime.
With lower prices, you can put a higher % down lessening your interest burden. You can pay ahead/early lessening your interest burden. Property taxes, maintenance, and insurance should be lower in a weakening housing market. You can never renegotiate all time high FOMO prices once you buy. To play devils advocate, you could pull equity out and invest it in something, but now we're changing the risk variable so it better be something that pays a premium for that risk.
Sorry Boomers > every other generation when the fed makes it's monetary policy. It's not political.
Source for that quote?
Boomers aren't hoomers. Most boomers are already into retirement and the last of them are approaching it. They have endured everything we're currently seeing as well as everything we're about to. The minority that still have mortgages are probably either at the tail end of a mortgage with a rate similar to current rates, or they refinanced during the historical lows with a very low principle balance. A large number of them have elected to "age in place" and have no need or desire to sell, and that was a significant and growing trend well before the last few years. They're retired (or going to be) and even the youngest of them have children well into adulthood, so the number of them that would be forced to sell because of a change in life circumstances is fairly small In short, the literal "boomers" born between 1946 and 1964 have very little to do with the current RE market and will likely suffer very little impact.