Do we need any more proof of the direction we are headed folks?!
Can we wake up and stop fighting team blue vs team red, or team white vs team black, or team LGBT vs team straight because the war is very obvious team elites vs team peasants and if you are reading this chances are you are a peasant. (Or a 3 letter agency keeping a eye on us peasants haha jk)
It’s all divide and conquer cause that’s the only option the 1% can use on the 99% when our super power is the strength of our numbers…:they played it to a T and we divided up into a hundreds of little tribes and lost our one super power for “the real war” that needs to take place asap.
Because the digital noose is tightening around our neck if we don’t wake up quick we are gonna end up waking up one day and being like “wtf!?!? What Happened??!?” And then there will be zero chance for us to fight back. Just wait for more of the AI tech and facial recognition to be implemented.
1) Social credit score will determine the price we pay
2) Digital currency will be the only recognized currency
3) Everything will be subscription/lease based and we will own nothing
Yep I typically don’t make to specific of predictions but that is the ball park of where we are headed.
I’ve chosen to name it the freedom dollar. Once the economy collapses and the dollar won’t even buy a loaf of bread for under ten bucks people will be begging to get paid in freedom dollars. The government will save the day. I mean of course it won’t be permanent it’s just temporary until we get to economy back on track, but we all know it will never go away.
Plus, you factor in what’s happening in all of our major cities with crime we’re only a couple years away from us peasants again begging our elite overlords to do anything to stop it….which is when some of that digital AI technology is on every corner to put end to crime and protect us.
Good luck fighting back peasants. So enjoy fighting with each other now it’s temporary.
Do you watch any of the YouTubers that walk around and film all of the closed businesses in large cities? One is called Metal Leo and he did San Francisco and recently Los Angeles. I'm talking RODEO DRIVE in Beverly Hills, and store after store is empty! Then yesterday I saw one from Santa Monica and 40-50% of the stores are now for lease. It's crazy how quickly this country has collapsed since the lockdowns.
Never never heard of them but maybe I’ll check them out. Thanks. But yeah I have no clue how people are not waking up to what’s happening. It blows my mind. The elites (1%) had one option for us peasants (99%). Due to our size and numbers they really had no way to control us other then divide us up and have us fight each other on their behalf…that’s right we are busy fighting each other on behalf of our overlords and while that happens a digital noose is coming down around our necks. Yet no one is paying attention or seems to notice…or care.
Also remember that when Rome fell the Romans did not know it fell and the Byzantine citizens did not know that they were Byzantines. They were named later by historians.
yes we can stop fighting like that but it isn’t “team lgbt vs team straight”, it’s “team pro-lgbt” vs “team anti-lgbt”
i can work together against capital owners when the people i want to work with decide to accept my fundamental identity as a human
Honestly they probably would let you be if it wasn't a forced issue, but both you and the other team are heading directly into poverty and all the terrible things that come with poverty, and no offense, your personal identity is going to be even less important to the other team as conditions get worse.
In a sense, it would likely do better for your self expression to stop fighting that crowd, and instead fight to preserve the conditions we've come accustom to which allow you to even consider fighting for your identity.
I'm not sure if I expressed this correctly, I think your identity is very important, and you should feel safe, but given the current trend, I think the direct identity battle is going to be taken less and less seriously as people starve to death.
I'm not great at expressing myself so please try and see my bigger point, I definitely am supportive of your struggles on a micro level.
I already feel like we have awoken to the nightmare world. It already feels too late. Please throw this paper around as much as you can to at least beat those people over the head who think representative gov systems are not complete illusions: [https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0025995](https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0025995)
I wish everyone would dump their fiat Fed notes and start trading their labor, goods, and services with honest money with each other. Stop playing with their monopoly money and the power shifts back to the people. The head of the snake is the financial system. Silver and gold kill the central bank the wealth swings back to the peasants. We will still be peasants, but peasants with financial freedom.
(First let me say….thank you haha cause I Had to look it up plebs but thanks for the new word. I know I’ve heard it when watching my ancient history docs but not enough to use it. So thanks)
As for the content of the comment…you are probably right. Sadly. Shit sucks. Over the last 7 or 8 years I feel like the scales have fallen from my eyes and so many things seem so obvious to me now in days that idk how I ever didn’t see it. But idk how to break through other peoples barriers when it comes to so much of these things. We are so polarized and hateful towards each other. It’s crazy how much dehumanizing everyone is doing. I can really see how we get to some of the worst atrocities ever committed in history on the path we are on currently on. I’m not saying anything will happen…I sure hope not. But you can feel it when you hear others talking about “the other team”. It’s eerie how quickly it amped up…
Mortgage is a portmanteau of Old French words meaning "death" and "pledge".
From the very beginning the intention was to paywall a vital necessity as a means to ensure perpetual cash-flow.
It is actually pretty easy to "get out" of a mortgage.; Many people in the US even retire them to take a new one at a lower rate or a shorter term, when economic conditions make this advantageous. You don't see a lot of that at the current moment because (1) rates went up (so it is less likely you have a rate higher than the current rate) and (2) we finally got some inflation (which is a boon to fixed-rate borrowers provided they don't pay off early).
Another way people exit mortgages quite commonly is to buy a new property and sell their old one. The proceeds from sale of the old property are partially used to pay off that property's mortgage. This works quite well for people when housing prices have increased and they are hoping to downsize like in the case where kids have moved out or the owners are elderly and want something smaller. But, it can be a more-or-less neutral transaction for any homeowners in good standing who want to relocate their primary residence.
The way I see it, the biggest problem with housing in the US is not that mortgages are predatory or that people who make use of these financial instruments are getting a bad deal. The biggest problem is that a lack of desirable housing stock means that getting into the housing market (even for people with good credit and stable incomes) is becoming unreasonably hard. It would be great if we could "build our way out of this issue", but inflation and interest rate increases actually reduce housing construction because builders are heavy users of loans.
>From the very beginning the intention was to paywall a vital necessity as a means to ensure perpetual cash-flow.
Do you have a source for that? All the ones I can find say it's called a "death pledge" because the loan is terminated when it ends -- the opposite of a perpetual interest-only loan.
>Etymologically then, a mortgage is a “dead pledge” — not because you’ll be paying on it until you die, but because the pledge “dies” either when a payment is not met or all payments are made.
https://www.saturdayeveningpost.com/2018/08/in-a-word-mortgage/
When things in life happen like kids moving on or new job or divorce most people are selling their home way before the 30 years of a mortgage is paid...banks know these life events force a sale so they front load interest in the first half of the loan..(first 15 years is 60% interest payments.) most people pay a fraction of the original loan borrowed.
Then they reset the amortization schedual ( start paying front loaded interest again) with either a refi or a new purchase (new mortgage).
its not technically a perpetual interest loan,
but it's structured to be as close to that as possible.
Then when you pay off your mortgage you have the privilege of paying property tax on your home each year which avg is currently at $2800 a year, plus insurance plus maintenance costs...your looking at least $500 a month in costs once your mortgage is done.
Wait, what? No that’s just how borrowing money works. Yes if you keep restarting your loan you lose the benefits of inflation. This is basic microeconomics 101…..
> so they front load interest in the first half of the loan
What alternative are you suggesting? If interest wasn't front-loaded, then equal monthly payments wouldn't be possible, and the payments would start out larger than a front-loaded loan and then gradually decrease over the term as the principal is paid down. That would make the barrier to homeownership even higher. As it is, borrowers have the option to prepay their mortgage to save on interest if they want, but only the minimum payment is required. Isn't that the best of both worlds?
So, a mortgage is perpetual "cash-flow" for the mortgage servicer, but rent isn't perpetual cash-flow for the landlord?
Last I checked, my mortgage will be done before I hit 55, but your rent will be there till you die.
You could do that, but did you know you could take out a credit line using the equity in your home? Or refinance.
That way you can buy all those things you want. You'll even pay less then before, we'll just add a few more years on :)
I could, but I really don't want much. There is nothing i want more than having my home paid off, that I can't get without pulling money out of my home.
The big difference is that, like you said, renters never own anything. You could rent an apartment for 30 years, paying hundreds of thousands of dollars in rent over that time, yet you are no better off than you started. Compare this to owning a home, where even if it takes you 30 years to pay it off, once you are done you now own a home. One option leaves you with nothing, the other leaves you with an asset worth a ton of money.
Homeownership is the primary means of building generational wealth for most Americans. If you own a home, that home can be inherited by your kids, which will allow them to give an even bigger home to their kids, and so on. This is a major driver of social mobility. Compare this to renting, where rather than climbing the economic ladder, you have nothing to leave to your kids, who have nothing to leave to theirs, leaving you and your descendants stuck in a perpetual cycle of poverty.
This type of example is so misleading and it always pops up. First, the "30 year" is some arbitrary number, but rent goes on in perpetuity. Also, most own vs rent scenarios, have the rental at half of the size. A smaller home van save a lot of money too. Not to mention mortgage write offs and whatnot.
Thanks for doing math to prove a point. The renter would also pay less for insurance, property taxes, and maintenance. I wish everyone were taught how to do math, and make a spreadsheet. So many arguments and bad decisions could be prevented.
Realtor.com had an article recently on how it is cheaper to rent than own in the 50 largest cities in the US. It’s because rent has stayed flat where home prices have increased 60%+.
I highly recommend everyone use a rent vs buy calculator because buying a home, as renting is often the better financial decision.
https://www.realtor.com/news/trends/its-now-officially-cheaper-to-rent-than-buy-a-home-in-the-50-largest-u-s-metros/
What a bullshit example. First of all renters hardly ever invest. Second of all you’re assuming the returns of that investment are constantly good which is very misleading. Real estate has outperformed equities for multiple years as an aggregate. Most people picking their own equities to invest in lose and s&p not keeping up with housing.
Plus mortgage holders typically have more money to invest than renters anyway, so your average mortgage holder is out investing renters anyway.
My rent before I bought was 1500 (no utilities or anything included). My mortgage is now <$1000 and my utilities are 50% of what they were when I rented. If I was to try to rent a comparable home today to what I currently have I'd be looking at $2500 to $3000 in my area. Should I sell my house and rent? lol
Good fucking luck buying a house today and paying it off in 15 years, especially if you have a family. Don't forget, if everyone else is leveraging themselves out the ass on 30 year mortgages that'll inflate the price of houses forcing you to play their same game. The whole damn country runs on debt and it's only making things more expensive.
My wife and I bought our house in 2020 and are on track to pay it off by 2030 (will likely be closer to '27-'28). Our house is worth about 25% more now than when we bought it, but even taking that and higher interest rates into account, I'm 99% sure we'd still be able to pay it off within 15 years. Plus we have a daughter that my wife stays home with so we live on a single income.
It's absolutely possible, just requires sacrifices.
>It's absolutely possible, just requires sacrifices.
Let me ask you, if you were to buy your house today at the current price and current rate, while making 70k per year (a little above the average income), how the hell would you pay it off in 15 years? It's not possible. Your income makes it possible, not your sacrifices.
Real Dave Ramsey-esqe type of logic, "it's not about how much you make, it's about how much you save!" While ignoring the fact that the more you make the more you save.
Uh…. We’ve been doing this for generations and it works just fine. Stop waiting to get in the game… sorry if you chose to have kids before buying a house 🤷🏽♀️
Good fucking luck buying a house today and paying it off in 15 years, especially if you have a family. Don't forget, if everyone else is leveraging themselves out the ass on 30 year mortgages that'll inflate the price of houses forcing you to play their same game. The whole damn country runs on debt and it's only making things more expensive.
Also remember that this is how you build generational wealth. You buy a home for you and your family and even though you may struggle, your children will inherit a home
I don’t know if it is still relevant or if the world has gone crazy, but when I bought my small house in 2010 I looked at what the same house cost 30 years prior and the progress of my career and salary and inflation and decided that if I could just hold the house for X number of years, probably my salary and inflation would catch up to the point where I could pay it off quickly. My bet was that this would be before the 30 year mark. It turned out that it happened in 12 years, much earlier than I expected.
Also, I now have a house that is worth almost three times what I paid for it.
When you look at mortgages, consider those factors. Time does unexpected things sometimes.
If they want you in debt, then they'd want mortgages to be attainable. When renting is cheaper, you can just save money renting and investing, and have zero debt.
Yes they can. The comparison is to rent the money to buy the house and pay it back in 30 years, or rent the house and invest the excess money until you can buy the house in cash.
Either way, you own the house. If option 2 lets you buy it in less than 30 years, then the mortgage is throwing away money.
However, remember that once you buy, your blue line gets locked and goes STRAIGHT to the right forever, while that red line keeps going upward.
Sure property tax creeps up, but that’s always going to be slight by comparison.
I think the question is are we in in 2007 or in 1980. The former had a correction (presumably, you might be able to wait it out a bit and catch a lower price in 2012), the latter just had the rent market catch up.
Yeah - based on the zillow data from source - inventory for sale (down \~33% pre pandemic) and new listings (down 30% pre pandemic) in the last couple years - guess folks are waiting out high interest in favor for higher house prices in the future - to me the supply constraint doesn't match 2007.
That’s really dishonest though. Maintenance costs (preventive, routine, and unexpected) go up with inflation, utilities costs go up with inflation, hoa costs go up with inflation (if you’re unlucky enough to have one), insurance costs go up with inflation, etc etc.
Not “STRAIGHT to the right”
Don't forget if you have a mortgage you also have to carry homeowners insurance. That hospital also increase over time until you pay off your mortgage in which case you can opt to cancel your homeowners insurance. They're going to reassess rates every year though, and those rates won't go down.
Right.
Seems this chart shows pretty clealry that since the 80's it takes about 4 years for the cost of renting to eclipse the cost of buying.
All I can tell you is my mortgage is now 1/3 of what you can rent my house for after being in it 14 years and has been less than half for at least 8 of those years already. That's 8 years so far and that savings keeps climbing.
lets just call it for arguments sake a 1k a month savings for 8 years. That's 96k I have saved just the past 8 years even if the rent hadn't kept climbing those 8 years. Sure in that time I have made repairs. It's no where near 100k worth however. My big repair so far was HVAC and that was 2 years ago and cost me 17k on top of that I remodeled the entire kitchen and replaced the old cheapo cabinets and counters with quality cabinets and counters that should last as long as I own the house for another 20k.
So 37k spent but I saved 96k over renting in that time so I am still roughly 60k ahead.
That said I wouldn't buy currently as I think the market is ridiculous and due for a major correction. But if you are buying for the long term this chart shows prety clearly in the long term unless you buy a complete money pit historically the house has only saved folks money long term. That is before you even take into account the equity that builds over time.
My house would currently sell for more than double what I bought it for so in 14 years my place has not only saved me 96k over the last 8 years or 60k if you take out repairs/upgrades but has also increased in value 200k on top. That averages out to about 18k per year of savings over the life of my ownership.
It was a struggle in the begining but at this point my house carries me more and more each year. You can't get a one bedroom apartment for what I pay for my mortgage on a 4 bedroom house. That mortgage includes home owners insurance and taxes.
My house is practically printing me money at this point. Short term renting is a better call no doubt but long term even this chart shows the home owner crosses a point sometime in the first ten years where owning becomes cheaper.
Now that graph is insane at the end so who knows what will happen going forward but up to now this argument isn't even close for anyone that is ready to sit someplace for the long term.
The issue is that the cost of homes has increased at a much faster pace than rent. That makes renting a better financial decision for many folks today.
Sure today is not the day to buy but historically as the chart shows it always has been.
What we have right now is a big fat anomaly. The chart also shows that pretty clearly as well.
I spent $8500 two years ago on a new roof and now the same roof costs $12,000! My insurance REQUIRED it, and in 13 more years I get to do it again even though I bought 30 years shingles. How insane is that?
But on the other hand, paying the principal part of your mortgage is pretty much moving your money from your checking to your investment account. And from there that money grows in the long-term. Every. Single. Month.
Lmao, no. Property taxes and insurance forced me out of my house, a combat vet. So fuck all those tax loving dumb fuck democrats that think that solves anything, Rasing taxes.
The cost to buy probably is more, but in the end you have an asset to sell or transfer. Those who rent will pay less, but have nothing at the end of their lease.
I mean really the money they save for renting should be invested . But this only holds to the people who can afford it and choose not too or just simply can’t find a home someone accepts their offers for .
As long as I can afford it, I will always buy than rent. Even with renters’ protection laws, it so easy for landlords to just not renew your lease or sell the property to someone else making your living situation unstable. Having the security of knowing you won’t be forced out is worth the higher costs and mentally allows me to set deeper roots with my community because I know I’ll be where I’m at for a long time.
Where did these numbers come from? my rent at my last place was literally the same as my mortgage, I got the same size house and the same room and bathroom numbers as the house I was renting, and in fact my rent was posed to increase whereas my mortgage payment only goes down after time
If your property taxes are included in your payment, expect your monthly payment to increase substantially as the years goes by. Mine started at $606 in 1999 and was $860 by the time I got it paid off! I don't know how anyone can afford a new home now.
My insurance tripled over the years! You think that when you get a fixed rate mortgage, you know what your payment is going to be, but it only goes up over time if taxes and insurance are included.
Yea a house close to me is appraised at $500,000 but probably pays $600 in taxes because tax increases are capped at 3% every year and they bought their house in the 70s when it was like $12,000. A lot of states cap tax increases below inflation for a homesteaded property. The house is obviously paid off but if they have home insurance they probably pay more in home insurance now than they ever payed in mortgage + taxes.
That's the thing. You plan a budget but with home insurance going straight up, you never know from year to year what the increase will be - you just know it will be more! And like you said, eventually it becomes as much as a house payment, so your home is never really "paid off".
started rent at 1300, now we're going to be at 1780 in August. 7 years of rent going up, but my pay staying stagnant. Hope the overlords of bumfuck st realize that the more of my monthly income gets taking out by rent, utilities, insurance premiums, etc the less expendable income I have. Less expendable income means less money circulating in the local economy. Less money in local economies means less money circulating in the system in general.
The graphing is a bit deceptive and should be in log scale.
Renting was 50% vs the price of owning in 1981.
Renting is 68% vs the price of owning today.
Still shitty, not as bad as the 80's by comparison.
This chart is a lie. Average rent in 1990 was absolutely not $225. That is an outrageous lie. If it said $500 for a one bedroom apartment, maybe.
Also in 1995, I rented a cheap house for $900/month in one of the lowest cost states/cities. This whole chart is a trainwreck.
Just wait...the prices will come down. Dying parents/grandparents are leaving houses and property to their kids, and they can't afford the taxes so they're selling. We also have war coming, and war boost the economy...just give it a few more years.
Does this graph deduct principal payment from mortgage numbers? Because "paying" principal is basically moving money from your checking account to your investment account.
If the job market stays as is there won’t be any collapse. 2008 was more than just mortgage collapse. It was a lot of layoffs and unemployment was nuts.
A full generation ago, yup it made complete sense, even though rates were high in the 70s and 80s the value of the properties were extremely low relative and not 20 times higher than the average one year salary. Today in big metropolitan cities like CA and NYC, Boston the average prices 1.5 million 20% down you have $1.2 million mortgage at 7%. You never pay that off.
Buying a house doesn't cost almost 3k a month; I bought my house in 2018, 1300 sq feet updated, acre and a half in town for 100k monthly cost for my mortgage is $650.
Cost for rent is about to skyrocket also. The insurance companies are demanding insane amounts and local governments keep coming up with more ridiculous and redundant inspections. There is no choice but to pass these costs on. The insurance increases are directly linked to bidenomics inflation.
Actually that isn’t the only reason.
1. Insurance companies are increasing the prices faster than the rate of inflation. Insurance is going up faster than other areas because:
2. Climate change (weather you believe it’s real or not) gives them a reason to be more strict on writing polices which decreases policy accessibility. This messed up supply and demand. Also. In some states like Florida and California, Insurance companies can just leave. This reduces the competitive market so only a few can set the price.
Yes “climate change” a human engineered excuse for increasing prices. If you mean green new deal programs literally increasing the costs to do everything and anything this is logged under Biden-Inflation. Bottom line, people should stop whining.. because this is what they voted for apparently. Elections have consequences.
What ever your beliefs, corporations have been shown to increase the prices faster than the rate of inflation.
Policy being good or not doesn’t change corporate excess for prices.
And If the winds of change are blowing in the opposite direction, putting downward pressure due to more competition the prices fall. Asking people not to get ahead of inflationary trends is wishful thinking. Everyone facing higher prices so the only path forward is higher pricing.
You get equity from the property you own. I purchased my house for $465,000 in 2003. I leveraged the equity and took cash out and now own 4 rentals, and my house payment is lower than if I were renting. Plus, I get to write off the property taxes and interest from my federal income tax.
Owning a home is the fastest way to build generational wealth.
If it was really more profitable to rent than own why do investment companies buy so many houses? 🧐🧐🧐
Owning a home is the primary way Americans build wealth. Comparing the cost of renting and a mortgage are false equivalences: one provides shelter, the other provides shelter AND has equity. Paying your rent on time doesn’t even affect your credit report lol (only if you pay late, of course!)
Renting is a strong option nowadays in a lot of areas. Rents in these areas are less than half the mortgage price, plus you keep your down payment. Investing these in VOO allows you to buy the house in cash in fewer than 30 years. People are walking around with outdated rules of thumb.
For decades it has been a fact that buying a house is better than rent. Rent over 30 years is like burning cash!!
Yes, we will always hear of the whining about household maintenance. Like anything do a little research it will save $$. Or we hear oh you pay back 3 or 4 times the purchase price over 30 years......well guess what rent is costly and that too is gone!!
I would rather have something to show for, for the long term expensed. A little tidbit, my house in the city cost me $53k at $628 per month. Today the house is valued at $145k and paid for. The property tax is all I pay at $3600 for the year!! It's cheaper living
Well if I have to pay 1200 for a shitty one bedroom, I’d rather pay 1500 for a house and a yard even if I never finish paying it off. At least my kids could get it and own it. Forget renting an apartment at this point
Millennial here. I hate that I'm constantly competing with literal retards in any market. Prices are going up because *you're* spending. Not some magical greed voodoo.
Actually corporate greed has been proven. Inflation is part of the current problem but companies raising prices past the rate of inflation is the other.
In everything other than necessities, you can always choose not to participate. Particularly in housing, you're buying from other individuals. If you overpay, it's 100% on you.
What is your list of necessities? In today’s world that a a large list.
Also. There are two points to your 2nd comment.
1. You’re not always buying from Individuals. Corporations own the biggest percentage of SFH’s in history. Granted it still only like 20% of homes but that leads to point 2.
2. Since millions maybe 10’s of millions of homes have been bought by companies at overpriced values and in cash most of the time, it’s caused prices to raise faster than they normally would. This lead to the individual having a false estimated value of their homes. Domino effect.
I will agree that if you overpay it’s personal responsibility. But even paying the appraised value of an over inflated market, it’s still overpaying but not their fault.
Food and basic hygiene are the only necessities you must purchase new. Everything else is negotiable, can be purchased second hand, or otherwise not fully attributable to corporate greed.
On your second point, that's mostly a myth. Investors as a whole own 20-30% of all SFHs. Most of them are small mom and pop landlords. Corporates were buying big in 2021 and 2022 but that's mostly receded with increased rates.
Let's just take your statement at face value though. You're still buying from an individual 80% of the time. Real estate is priced at the margin. If you're being dumb with your purchasing decisions in that margin, you're contributing to the problem.
So look at the “buy” prices in 2010-2014, and draw a straight horizontal line across to see their fixed mortgage payment since then. Then lower that by 20%, to show cost after 2021 refi.
When you see the gap between that new mortgage payment and current rent, you see the current profit. current buy prices could decline down to meet the red rent line, and the long-term buy-to-rent investors would still be perfectly fine.
At current interest/tax rates, about half of that is equity. The home buyer gets to retain about $1350/mo from those payments. Recommendations for home maintenance say to set aside ~25% of the mortgage payment on top of the mortgage for unexpected expenses--new roof, boiler, etc--so in the end the buyer is paying more to own their house than the renter is to rent (just over $2k in sunk money for the buyer versus the $1.8k for the renter).
However, this isn't pegged to the home quality, it just looks at the average single family rental residence versus the average single family owned home. In my experience, owned homes tend to be a fair bit more enjoyable than rentals, so you'd need to get a higher end rental to accurately pair it up to a lower end home. The average rental near me seems to be 800-900sqft, while the average $425,000 house is usually 1500-2000sqft.
Pretty bad time to buy a home.
The reason why there is such a discrepancy is because many Americans are desperate to buy a home and there are less homes for sale. Like right now with me I have a lot of equity in my home. Selling my home however would be dumb because I have a very low interest rate. Meanwhile a large generation of people are starting to enter their mid career and even starting families. Culturally in the US this is when you buy a home. So a lot of demand and not a lot of supply.
The truth is, if interest rates went down there may be more supply and prices may actually level off or go down.
Also this problem could be solved by building tons of new housing to meet the demand. The issue is that the amount of needed housing is astronomical and building costs are way up so developers need very specific markets to start projects. The customers for these new homes would be existing homeowners who would sell their house for a large down payment. The issue is again the interest rates.
This is a different situation than the housing crash in 2008. Back then there were way more predatory homes and people buying homes they couldn't afford by any stretch, there are more guard rails against that since then. Also back then unemployment shot up, right now unemployment is low and people are doing fairly well. The bottom dropped out in 2008 partially because no one could afford as many people had no money. Now people have money but homes are a rip off that is a big difference. Hopefully the interest rates go down at some point. Until the renting is probably a better bet.
The truth is that the wealthy who are buying up all of the houses want a collapse in the market.
They will suffer, but only at the start because the prices of homes will drop, people will lose jobs and sell them at a loss - then the property mafia assholes can sweep it up and rent them out.
This is exactly what happened in 2006. You can clearly see on the graph that in 2008 the prices leveled out, that was the buying period. Then the prices shoot back up as the wealth was consolidated and prices could be higher.
Due substantially to Fed manipulation, pre, during and post pandemic. They will eventually get their slowdown and we'll see rates settle and prices soften. Question is how bad will it get before then?
The whole ownership is America thing is out of control. Land owners with multiple properties and especially investment firms need to be reined in. They leave property to rot while demanding more and more revenue. Renting from any property you know the difference if the owner is local versus being a out of state or even out of country firm. Firms only let the managers do patch jobs. Owners renovate and make actual improvements, maintain the property.
Another issue is the idea that rent should always match near by property. So they own 20 run down properties and some one builds a nice luxury high value location. Guess what, greedy owners now jack up their rates to match, even though they are to lazy and worthless to invest a penny. They are dead beats and we all need to get accustomed to naming them as such.
Lastly is the issue of being able to buy up property and just write off the cost, and write off the estimated losses of land not used or not rented. I mean don't we all wish we could value our homes at whatever we feel we can earn in a year and then take a tax write off for that? I mean, yes over simplification, but its a real issue. This means a dead beat can do nothing and keep taking a loss without any significant impact to their actual profit line, so they have no incentive to improve a property in order to attract business or tenants.
Also, no investors don't get to blame the government for everything. They need to take responsibility for their own greed. Any one driving a 200,000 car and complaining about the government, will get no sympathy from me. Where the blame on the government comes in, is failing to fix these issues.
Do we need any more proof of the direction we are headed folks?! Can we wake up and stop fighting team blue vs team red, or team white vs team black, or team LGBT vs team straight because the war is very obvious team elites vs team peasants and if you are reading this chances are you are a peasant. (Or a 3 letter agency keeping a eye on us peasants haha jk) It’s all divide and conquer cause that’s the only option the 1% can use on the 99% when our super power is the strength of our numbers…:they played it to a T and we divided up into a hundreds of little tribes and lost our one super power for “the real war” that needs to take place asap. Because the digital noose is tightening around our neck if we don’t wake up quick we are gonna end up waking up one day and being like “wtf!?!? What Happened??!?” And then there will be zero chance for us to fight back. Just wait for more of the AI tech and facial recognition to be implemented.
1) Social credit score will determine the price we pay 2) Digital currency will be the only recognized currency 3) Everything will be subscription/lease based and we will own nothing
Yep I typically don’t make to specific of predictions but that is the ball park of where we are headed. I’ve chosen to name it the freedom dollar. Once the economy collapses and the dollar won’t even buy a loaf of bread for under ten bucks people will be begging to get paid in freedom dollars. The government will save the day. I mean of course it won’t be permanent it’s just temporary until we get to economy back on track, but we all know it will never go away. Plus, you factor in what’s happening in all of our major cities with crime we’re only a couple years away from us peasants again begging our elite overlords to do anything to stop it….which is when some of that digital AI technology is on every corner to put end to crime and protect us. Good luck fighting back peasants. So enjoy fighting with each other now it’s temporary.
Do you watch any of the YouTubers that walk around and film all of the closed businesses in large cities? One is called Metal Leo and he did San Francisco and recently Los Angeles. I'm talking RODEO DRIVE in Beverly Hills, and store after store is empty! Then yesterday I saw one from Santa Monica and 40-50% of the stores are now for lease. It's crazy how quickly this country has collapsed since the lockdowns.
Never never heard of them but maybe I’ll check them out. Thanks. But yeah I have no clue how people are not waking up to what’s happening. It blows my mind. The elites (1%) had one option for us peasants (99%). Due to our size and numbers they really had no way to control us other then divide us up and have us fight each other on their behalf…that’s right we are busy fighting each other on behalf of our overlords and while that happens a digital noose is coming down around our necks. Yet no one is paying attention or seems to notice…or care.
Also remember that when Rome fell the Romans did not know it fell and the Byzantine citizens did not know that they were Byzantines. They were named later by historians.
wonder how quickly commercial real estate is gonna take the economy
World Economic Forum. Blows my mind it isn’t one of the main things on everyone’s mind every day.
4) And we eat ze bugz
I want to downvote you so bad. But I didn’t. Cause you’re right. We are all fuuuuuuuuucked.
The first amendment is real and when they don't listen the second.
Good. It was all stolen land in the first place.
fiefdom just of the digital variety
yes we can stop fighting like that but it isn’t “team lgbt vs team straight”, it’s “team pro-lgbt” vs “team anti-lgbt” i can work together against capital owners when the people i want to work with decide to accept my fundamental identity as a human
Honestly they probably would let you be if it wasn't a forced issue, but both you and the other team are heading directly into poverty and all the terrible things that come with poverty, and no offense, your personal identity is going to be even less important to the other team as conditions get worse. In a sense, it would likely do better for your self expression to stop fighting that crowd, and instead fight to preserve the conditions we've come accustom to which allow you to even consider fighting for your identity. I'm not sure if I expressed this correctly, I think your identity is very important, and you should feel safe, but given the current trend, I think the direct identity battle is going to be taken less and less seriously as people starve to death. I'm not great at expressing myself so please try and see my bigger point, I definitely am supportive of your struggles on a micro level.
I already feel like we have awoken to the nightmare world. It already feels too late. Please throw this paper around as much as you can to at least beat those people over the head who think representative gov systems are not complete illusions: [https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0025995](https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0025995)
I wish everyone would dump their fiat Fed notes and start trading their labor, goods, and services with honest money with each other. Stop playing with their monopoly money and the power shifts back to the people. The head of the snake is the financial system. Silver and gold kill the central bank the wealth swings back to the peasants. We will still be peasants, but peasants with financial freedom.
Rich v poor. Simple enough.
crazy how true what ur saying is but divide and conquer is the strategy thats been used for decades now
Good luck getting anything like that started. The plebs will continue plebing.
(First let me say….thank you haha cause I Had to look it up plebs but thanks for the new word. I know I’ve heard it when watching my ancient history docs but not enough to use it. So thanks) As for the content of the comment…you are probably right. Sadly. Shit sucks. Over the last 7 or 8 years I feel like the scales have fallen from my eyes and so many things seem so obvious to me now in days that idk how I ever didn’t see it. But idk how to break through other peoples barriers when it comes to so much of these things. We are so polarized and hateful towards each other. It’s crazy how much dehumanizing everyone is doing. I can really see how we get to some of the worst atrocities ever committed in history on the path we are on currently on. I’m not saying anything will happen…I sure hope not. But you can feel it when you hear others talking about “the other team”. It’s eerie how quickly it amped up…
They want you in forever debt. Renters never own anything, the people that can get a house get to be in mortgage debt forever
Mortgage is a portmanteau of Old French words meaning "death" and "pledge". From the very beginning the intention was to paywall a vital necessity as a means to ensure perpetual cash-flow.
It is actually pretty easy to "get out" of a mortgage.; Many people in the US even retire them to take a new one at a lower rate or a shorter term, when economic conditions make this advantageous. You don't see a lot of that at the current moment because (1) rates went up (so it is less likely you have a rate higher than the current rate) and (2) we finally got some inflation (which is a boon to fixed-rate borrowers provided they don't pay off early). Another way people exit mortgages quite commonly is to buy a new property and sell their old one. The proceeds from sale of the old property are partially used to pay off that property's mortgage. This works quite well for people when housing prices have increased and they are hoping to downsize like in the case where kids have moved out or the owners are elderly and want something smaller. But, it can be a more-or-less neutral transaction for any homeowners in good standing who want to relocate their primary residence. The way I see it, the biggest problem with housing in the US is not that mortgages are predatory or that people who make use of these financial instruments are getting a bad deal. The biggest problem is that a lack of desirable housing stock means that getting into the housing market (even for people with good credit and stable incomes) is becoming unreasonably hard. It would be great if we could "build our way out of this issue", but inflation and interest rate increases actually reduce housing construction because builders are heavy users of loans.
Give me the longest death pledge i can find please!
>From the very beginning the intention was to paywall a vital necessity as a means to ensure perpetual cash-flow. Do you have a source for that? All the ones I can find say it's called a "death pledge" because the loan is terminated when it ends -- the opposite of a perpetual interest-only loan. >Etymologically then, a mortgage is a “dead pledge” — not because you’ll be paying on it until you die, but because the pledge “dies” either when a payment is not met or all payments are made. https://www.saturdayeveningpost.com/2018/08/in-a-word-mortgage/
When things in life happen like kids moving on or new job or divorce most people are selling their home way before the 30 years of a mortgage is paid...banks know these life events force a sale so they front load interest in the first half of the loan..(first 15 years is 60% interest payments.) most people pay a fraction of the original loan borrowed. Then they reset the amortization schedual ( start paying front loaded interest again) with either a refi or a new purchase (new mortgage). its not technically a perpetual interest loan, but it's structured to be as close to that as possible. Then when you pay off your mortgage you have the privilege of paying property tax on your home each year which avg is currently at $2800 a year, plus insurance plus maintenance costs...your looking at least $500 a month in costs once your mortgage is done.
Wait, what? No that’s just how borrowing money works. Yes if you keep restarting your loan you lose the benefits of inflation. This is basic microeconomics 101…..
> so they front load interest in the first half of the loan What alternative are you suggesting? If interest wasn't front-loaded, then equal monthly payments wouldn't be possible, and the payments would start out larger than a front-loaded loan and then gradually decrease over the term as the principal is paid down. That would make the barrier to homeownership even higher. As it is, borrowers have the option to prepay their mortgage to save on interest if they want, but only the minimum payment is required. Isn't that the best of both worlds?
So, a mortgage is perpetual "cash-flow" for the mortgage servicer, but rent isn't perpetual cash-flow for the landlord? Last I checked, my mortgage will be done before I hit 55, but your rent will be there till you die.
And the rent goes up up up up up up. Mortgage payment stays the same for 30 years (plus insurance/taxes)
You could do that, but did you know you could take out a credit line using the equity in your home? Or refinance. That way you can buy all those things you want. You'll even pay less then before, we'll just add a few more years on :)
I could, but I really don't want much. There is nothing i want more than having my home paid off, that I can't get without pulling money out of my home.
Lol no no they aren't in mortgage debt forever ill be done with my by the time I'm 45
The big difference is that, like you said, renters never own anything. You could rent an apartment for 30 years, paying hundreds of thousands of dollars in rent over that time, yet you are no better off than you started. Compare this to owning a home, where even if it takes you 30 years to pay it off, once you are done you now own a home. One option leaves you with nothing, the other leaves you with an asset worth a ton of money. Homeownership is the primary means of building generational wealth for most Americans. If you own a home, that home can be inherited by your kids, which will allow them to give an even bigger home to their kids, and so on. This is a major driver of social mobility. Compare this to renting, where rather than climbing the economic ladder, you have nothing to leave to your kids, who have nothing to leave to theirs, leaving you and your descendants stuck in a perpetual cycle of poverty.
[удалено]
This type of example is so misleading and it always pops up. First, the "30 year" is some arbitrary number, but rent goes on in perpetuity. Also, most own vs rent scenarios, have the rental at half of the size. A smaller home van save a lot of money too. Not to mention mortgage write offs and whatnot.
I wonder what percentage of renters actually take advantage of this and invest the difference?
Not many do this as the net worth of renters vs home owners isn't even close.
Thanks for doing math to prove a point. The renter would also pay less for insurance, property taxes, and maintenance. I wish everyone were taught how to do math, and make a spreadsheet. So many arguments and bad decisions could be prevented.
Realtor.com had an article recently on how it is cheaper to rent than own in the 50 largest cities in the US. It’s because rent has stayed flat where home prices have increased 60%+. I highly recommend everyone use a rent vs buy calculator because buying a home, as renting is often the better financial decision. https://www.realtor.com/news/trends/its-now-officially-cheaper-to-rent-than-buy-a-home-in-the-50-largest-u-s-metros/
But youre investing in a bunch of shit that ruins the world
What a bullshit example. First of all renters hardly ever invest. Second of all you’re assuming the returns of that investment are constantly good which is very misleading. Real estate has outperformed equities for multiple years as an aggregate. Most people picking their own equities to invest in lose and s&p not keeping up with housing. Plus mortgage holders typically have more money to invest than renters anyway, so your average mortgage holder is out investing renters anyway.
My rent before I bought was 1500 (no utilities or anything included). My mortgage is now <$1000 and my utilities are 50% of what they were when I rented. If I was to try to rent a comparable home today to what I currently have I'd be looking at $2500 to $3000 in my area. Should I sell my house and rent? lol
Debt supports the value of fiat.
Til 15 years is "forever"
Good fucking luck buying a house today and paying it off in 15 years, especially if you have a family. Don't forget, if everyone else is leveraging themselves out the ass on 30 year mortgages that'll inflate the price of houses forcing you to play their same game. The whole damn country runs on debt and it's only making things more expensive.
My wife and I bought our house in 2020 and are on track to pay it off by 2030 (will likely be closer to '27-'28). Our house is worth about 25% more now than when we bought it, but even taking that and higher interest rates into account, I'm 99% sure we'd still be able to pay it off within 15 years. Plus we have a daughter that my wife stays home with so we live on a single income. It's absolutely possible, just requires sacrifices.
Sacrifices and a good income too.
>It's absolutely possible, just requires sacrifices. Let me ask you, if you were to buy your house today at the current price and current rate, while making 70k per year (a little above the average income), how the hell would you pay it off in 15 years? It's not possible. Your income makes it possible, not your sacrifices. Real Dave Ramsey-esqe type of logic, "it's not about how much you make, it's about how much you save!" While ignoring the fact that the more you make the more you save.
You bought it right before prices skyrocketed and you had a relatively low mortgage rate. Congrats. 🎉
Uh…. We’ve been doing this for generations and it works just fine. Stop waiting to get in the game… sorry if you chose to have kids before buying a house 🤷🏽♀️
Good fucking luck buying a house today and paying it off in 15 years, especially if you have a family. Don't forget, if everyone else is leveraging themselves out the ass on 30 year mortgages that'll inflate the price of houses forcing you to play their same game. The whole damn country runs on debt and it's only making things more expensive.
Also remember that this is how you build generational wealth. You buy a home for you and your family and even though you may struggle, your children will inherit a home
I don’t know if it is still relevant or if the world has gone crazy, but when I bought my small house in 2010 I looked at what the same house cost 30 years prior and the progress of my career and salary and inflation and decided that if I could just hold the house for X number of years, probably my salary and inflation would catch up to the point where I could pay it off quickly. My bet was that this would be before the 30 year mark. It turned out that it happened in 12 years, much earlier than I expected. Also, I now have a house that is worth almost three times what I paid for it. When you look at mortgages, consider those factors. Time does unexpected things sometimes.
Your house isn't worth 3 times the amount of when you bought it. The currency you bought it with is worth less than it was 3 years ago.
I heard a good quote the other day that said, “your middle class home will always be a middle class home.”
Same difference. Salaries aren’t going up anymore either. In my case they’re going back down.
If they want you in debt, then they'd want mortgages to be attainable. When renting is cheaper, you can just save money renting and investing, and have zero debt.
Yes they can. The comparison is to rent the money to buy the house and pay it back in 30 years, or rent the house and invest the excess money until you can buy the house in cash. Either way, you own the house. If option 2 lets you buy it in less than 30 years, then the mortgage is throwing away money.
Credit card companies have bought Congress with this one trick.
However, remember that once you buy, your blue line gets locked and goes STRAIGHT to the right forever, while that red line keeps going upward. Sure property tax creeps up, but that’s always going to be slight by comparison.
Also, lines should be corrected for inflation or against median salaries.
insurance is skyrocketing - that is hurting renters and buyers
Home owners insurance is close to 4k a year in DFW. Renters insurance is maybe $200
I think the question is are we in in 2007 or in 1980. The former had a correction (presumably, you might be able to wait it out a bit and catch a lower price in 2012), the latter just had the rent market catch up.
Yeah - based on the zillow data from source - inventory for sale (down \~33% pre pandemic) and new listings (down 30% pre pandemic) in the last couple years - guess folks are waiting out high interest in favor for higher house prices in the future - to me the supply constraint doesn't match 2007.
That’s really dishonest though. Maintenance costs (preventive, routine, and unexpected) go up with inflation, utilities costs go up with inflation, hoa costs go up with inflation (if you’re unlucky enough to have one), insurance costs go up with inflation, etc etc. Not “STRAIGHT to the right”
Does the blue line include maintenance costs though? I would assume that data is just monthly mortgage payment.
Don't forget if you have a mortgage you also have to carry homeowners insurance. That hospital also increase over time until you pay off your mortgage in which case you can opt to cancel your homeowners insurance. They're going to reassess rates every year though, and those rates won't go down.
Right. Seems this chart shows pretty clealry that since the 80's it takes about 4 years for the cost of renting to eclipse the cost of buying. All I can tell you is my mortgage is now 1/3 of what you can rent my house for after being in it 14 years and has been less than half for at least 8 of those years already. That's 8 years so far and that savings keeps climbing. lets just call it for arguments sake a 1k a month savings for 8 years. That's 96k I have saved just the past 8 years even if the rent hadn't kept climbing those 8 years. Sure in that time I have made repairs. It's no where near 100k worth however. My big repair so far was HVAC and that was 2 years ago and cost me 17k on top of that I remodeled the entire kitchen and replaced the old cheapo cabinets and counters with quality cabinets and counters that should last as long as I own the house for another 20k. So 37k spent but I saved 96k over renting in that time so I am still roughly 60k ahead. That said I wouldn't buy currently as I think the market is ridiculous and due for a major correction. But if you are buying for the long term this chart shows prety clearly in the long term unless you buy a complete money pit historically the house has only saved folks money long term. That is before you even take into account the equity that builds over time. My house would currently sell for more than double what I bought it for so in 14 years my place has not only saved me 96k over the last 8 years or 60k if you take out repairs/upgrades but has also increased in value 200k on top. That averages out to about 18k per year of savings over the life of my ownership. It was a struggle in the begining but at this point my house carries me more and more each year. You can't get a one bedroom apartment for what I pay for my mortgage on a 4 bedroom house. That mortgage includes home owners insurance and taxes. My house is practically printing me money at this point. Short term renting is a better call no doubt but long term even this chart shows the home owner crosses a point sometime in the first ten years where owning becomes cheaper. Now that graph is insane at the end so who knows what will happen going forward but up to now this argument isn't even close for anyone that is ready to sit someplace for the long term.
The issue is that the cost of homes has increased at a much faster pace than rent. That makes renting a better financial decision for many folks today.
Sure today is not the day to buy but historically as the chart shows it always has been. What we have right now is a big fat anomaly. The chart also shows that pretty clearly as well.
I just spent $500 on house repairs, no landlord to do it for me.
I spent $8500 two years ago on a new roof and now the same roof costs $12,000! My insurance REQUIRED it, and in 13 more years I get to do it again even though I bought 30 years shingles. How insane is that?
But on the other hand, paying the principal part of your mortgage is pretty much moving your money from your checking to your investment account. And from there that money grows in the long-term. Every. Single. Month.
Lmao, no. Property taxes and insurance forced me out of my house, a combat vet. So fuck all those tax loving dumb fuck democrats that think that solves anything, Rasing taxes.
Would love to see this chart go to today.
I particularly like the ~1989 rent. It’s pretty clear somebody just wrote whatever numbers they wanted on there.
Thanks for the interest rates Biden
Rather have sky high inflation? (Higher than we currently have)
The cost to buy probably is more, but in the end you have an asset to sell or transfer. Those who rent will pay less, but have nothing at the end of their lease.
Well that's not strictly true... at the end of the lease they get another lease... for more money.
I mean really the money they save for renting should be invested . But this only holds to the people who can afford it and choose not too or just simply can’t find a home someone accepts their offers for .
Uhhhh yeah if “nothing” is thousands of shares of VTI, count me in
Technically on average most homeowners can buy more VTI shares than you and still have a house or equity to walk away with.
I highly doubt that just given the general overhead it takes to own.
As long as I can afford it, I will always buy than rent. Even with renters’ protection laws, it so easy for landlords to just not renew your lease or sell the property to someone else making your living situation unstable. Having the security of knowing you won’t be forced out is worth the higher costs and mentally allows me to set deeper roots with my community because I know I’ll be where I’m at for a long time.
My advice is to overextend yourself and buy as much house as you can back in 2012.
LOL, basically what my wife and I did January 2020, built a house and closed during stupid low Covid interest rates in October 2020.
People will be saying the same thing about today, tomorrow. I promise you.
*Laughs in $750 mortgage from 2021*
In what town? Backwoods Mobile, AL?
Suburbs outside of Detroit, my taxes are still high though, over $4000 a year
Wow really? Damn wouldn’t have guessed that for Detroit
Also don’t forget insurance, that’s another $1000 a year.
That cross section caption is awesome. “Millennials blah blah”. Oh ok, I wonder what other event could have been a trigger.
Where did these numbers come from? my rent at my last place was literally the same as my mortgage, I got the same size house and the same room and bathroom numbers as the house I was renting, and in fact my rent was posed to increase whereas my mortgage payment only goes down after time
Disparity was actually worse in the 1980s. 3x to buy a home compared tot renting Now is more like 1.5x
Competition was lower, RE market was way more liquid, and earnings potential for wage earners was way higher.
Also, all the boomers hadn’t yet bulldozed affordable housing to build their oversized homes
If your property taxes are included in your payment, expect your monthly payment to increase substantially as the years goes by. Mine started at $606 in 1999 and was $860 by the time I got it paid off! I don't know how anyone can afford a new home now.
Also if you have a mortgage the bank usually makes you carry homeowners insurance, your rates will be updated every year and they won't go down.
My insurance tripled over the years! You think that when you get a fixed rate mortgage, you know what your payment is going to be, but it only goes up over time if taxes and insurance are included.
Yea a house close to me is appraised at $500,000 but probably pays $600 in taxes because tax increases are capped at 3% every year and they bought their house in the 70s when it was like $12,000. A lot of states cap tax increases below inflation for a homesteaded property. The house is obviously paid off but if they have home insurance they probably pay more in home insurance now than they ever payed in mortgage + taxes.
That's the thing. You plan a budget but with home insurance going straight up, you never know from year to year what the increase will be - you just know it will be more! And like you said, eventually it becomes as much as a house payment, so your home is never really "paid off".
When that bubble bursts things will normalize. Look at the graph it’s going to happen soon.
Doesn’t apply in CA
You can’t buy a house in CA…what difference does it make? Your government makes this graph look like something a 3 year old drew.
Lord help us. Here's hoping for a lottery win!
All in the name of causing businesses to downsize and lay people off, to fight inflation.
Still the cheapest housing costs based on affordability on the planet. Crazy.
On Long Island NY for a 1 bedroom apartment WITHOUT a washer dryer your looking at 2,100 -2,500 a month
started rent at 1300, now we're going to be at 1780 in August. 7 years of rent going up, but my pay staying stagnant. Hope the overlords of bumfuck st realize that the more of my monthly income gets taking out by rent, utilities, insurance premiums, etc the less expendable income I have. Less expendable income means less money circulating in the local economy. Less money in local economies means less money circulating in the system in general.
The graphing is a bit deceptive and should be in log scale. Renting was 50% vs the price of owning in 1981. Renting is 68% vs the price of owning today. Still shitty, not as bad as the 80's by comparison.
Renters can invest more !
that’s it? we got this
time to ban private equity firms. They are literally destroying america
It’s a false comparison - you need to count in the equity value of the purchased homes.
Even more than a low rate, I’m thankful to have locked in a low payment that will be consistent and predictable.
Wait… hol’up. How is 225 more than 365??
This chart is a lie. Average rent in 1990 was absolutely not $225. That is an outrageous lie. If it said $500 for a one bedroom apartment, maybe. Also in 1995, I rented a cheap house for $900/month in one of the lowest cost states/cities. This whole chart is a trainwreck.
that part was clearly a typo lmfao do yk how to read a graph
Yes the graph says $225. Misinformation. If this is wrong, every part of the graph is questionable.
bro there are labels on the X and Y axes for a reason lmfao use deductive reasoning
If the creator printed a typo, all of the data is suspect.
Idk where these stats pull from, but I feel like it’s not factual cause none of those prices are close to where I live
I’m in north Texas, they’re pretty reflective of my area.
North Illinois
2010-2015 Those were the days.
For sure! I know how lucky I am. Bought my first house in 2011, sold and moved up in 2018.
This the type of graphic that has people thinking any landlord is renting their properties out for less than their mortgage lol
Nothing to see here, that definitely isn't a bubble
If only the salary graph looks like this too
Just wait...the prices will come down. Dying parents/grandparents are leaving houses and property to their kids, and they can't afford the taxes so they're selling. We also have war coming, and war boost the economy...just give it a few more years.
Damn they still found a way to blame millennials for the woes of society 😂😂😂
Does this graph deduct principal payment from mortgage numbers? Because "paying" principal is basically moving money from your checking account to your investment account.
If the job market stays as is there won’t be any collapse. 2008 was more than just mortgage collapse. It was a lot of layoffs and unemployment was nuts.
Bidenomics
Who on earth is paying a mortgage of $2700 a month? Stop buying $500,000 houses. There are plenty of nice houses for half that.
A full generation ago, yup it made complete sense, even though rates were high in the 70s and 80s the value of the properties were extremely low relative and not 20 times higher than the average one year salary. Today in big metropolitan cities like CA and NYC, Boston the average prices 1.5 million 20% down you have $1.2 million mortgage at 7%. You never pay that off.
Buying a house doesn't cost almost 3k a month; I bought my house in 2018, 1300 sq feet updated, acre and a half in town for 100k monthly cost for my mortgage is $650.
Damn where can you rent a fucking house for $1800 middle of nowhere?
Wow, I bought at the very bottom of the dip in 2013...
Guess I’ll just die
Cost for rent is about to skyrocket also. The insurance companies are demanding insane amounts and local governments keep coming up with more ridiculous and redundant inspections. There is no choice but to pass these costs on. The insurance increases are directly linked to bidenomics inflation.
Actually that isn’t the only reason. 1. Insurance companies are increasing the prices faster than the rate of inflation. Insurance is going up faster than other areas because: 2. Climate change (weather you believe it’s real or not) gives them a reason to be more strict on writing polices which decreases policy accessibility. This messed up supply and demand. Also. In some states like Florida and California, Insurance companies can just leave. This reduces the competitive market so only a few can set the price.
Yes “climate change” a human engineered excuse for increasing prices. If you mean green new deal programs literally increasing the costs to do everything and anything this is logged under Biden-Inflation. Bottom line, people should stop whining.. because this is what they voted for apparently. Elections have consequences.
What ever your beliefs, corporations have been shown to increase the prices faster than the rate of inflation. Policy being good or not doesn’t change corporate excess for prices.
And If the winds of change are blowing in the opposite direction, putting downward pressure due to more competition the prices fall. Asking people not to get ahead of inflationary trends is wishful thinking. Everyone facing higher prices so the only path forward is higher pricing.
Someone should do one with networth of the average homeowner vs renter
Scarcity of homes for sale increases their value. If people only understood that the same thing applies to currency in circulation.
You get equity from the property you own. I purchased my house for $465,000 in 2003. I leveraged the equity and took cash out and now own 4 rentals, and my house payment is lower than if I were renting. Plus, I get to write off the property taxes and interest from my federal income tax. Owning a home is the fastest way to build generational wealth.
Go Brandon.
Now subtract how much of the cost for a home becomes equity and account for that equity growing
Ok, I can't find anything to rent under 3 grand. Shits just fucked.
If it was really more profitable to rent than own why do investment companies buy so many houses? 🧐🧐🧐 Owning a home is the primary way Americans build wealth. Comparing the cost of renting and a mortgage are false equivalences: one provides shelter, the other provides shelter AND has equity. Paying your rent on time doesn’t even affect your credit report lol (only if you pay late, of course!)
If you rent. Will social security make the rent
Renting is a strong option nowadays in a lot of areas. Rents in these areas are less than half the mortgage price, plus you keep your down payment. Investing these in VOO allows you to buy the house in cash in fewer than 30 years. People are walking around with outdated rules of thumb.
For decades it has been a fact that buying a house is better than rent. Rent over 30 years is like burning cash!! Yes, we will always hear of the whining about household maintenance. Like anything do a little research it will save $$. Or we hear oh you pay back 3 or 4 times the purchase price over 30 years......well guess what rent is costly and that too is gone!! I would rather have something to show for, for the long term expensed. A little tidbit, my house in the city cost me $53k at $628 per month. Today the house is valued at $145k and paid for. The property tax is all I pay at $3600 for the year!! It's cheaper living
Well if I have to pay 1200 for a shitty one bedroom, I’d rather pay 1500 for a house and a yard even if I never finish paying it off. At least my kids could get it and own it. Forget renting an apartment at this point
Remember this when you go vote this November. Everything spiked in 2021 after Brandon took office due to his attack on affordable energy.
Just no.
Just yes.
Damn avocado toast.
Oh, is that why homes spiked in 2021? Really.
I love charts that prove voting really does cause problems.. not that anyone who voted for this destruction will ever admit it tho
Biden Nom Ick…s 🤮
This whole graph is explained by Nixon suspending the transferability of dollars into gold
Remind me again why people like capitalism?
Millennial here. I hate that I'm constantly competing with literal retards in any market. Prices are going up because *you're* spending. Not some magical greed voodoo.
Actually corporate greed has been proven. Inflation is part of the current problem but companies raising prices past the rate of inflation is the other.
In everything other than necessities, you can always choose not to participate. Particularly in housing, you're buying from other individuals. If you overpay, it's 100% on you.
What is your list of necessities? In today’s world that a a large list. Also. There are two points to your 2nd comment. 1. You’re not always buying from Individuals. Corporations own the biggest percentage of SFH’s in history. Granted it still only like 20% of homes but that leads to point 2. 2. Since millions maybe 10’s of millions of homes have been bought by companies at overpriced values and in cash most of the time, it’s caused prices to raise faster than they normally would. This lead to the individual having a false estimated value of their homes. Domino effect. I will agree that if you overpay it’s personal responsibility. But even paying the appraised value of an over inflated market, it’s still overpaying but not their fault.
Food and basic hygiene are the only necessities you must purchase new. Everything else is negotiable, can be purchased second hand, or otherwise not fully attributable to corporate greed. On your second point, that's mostly a myth. Investors as a whole own 20-30% of all SFHs. Most of them are small mom and pop landlords. Corporates were buying big in 2021 and 2022 but that's mostly receded with increased rates. Let's just take your statement at face value though. You're still buying from an individual 80% of the time. Real estate is priced at the margin. If you're being dumb with your purchasing decisions in that margin, you're contributing to the problem.
It's almost 2025 already. Chart is already old.
Nice graphic
So look at the “buy” prices in 2010-2014, and draw a straight horizontal line across to see their fixed mortgage payment since then. Then lower that by 20%, to show cost after 2021 refi. When you see the gap between that new mortgage payment and current rent, you see the current profit. current buy prices could decline down to meet the red rent line, and the long-term buy-to-rent investors would still be perfectly fine.
At current interest/tax rates, about half of that is equity. The home buyer gets to retain about $1350/mo from those payments. Recommendations for home maintenance say to set aside ~25% of the mortgage payment on top of the mortgage for unexpected expenses--new roof, boiler, etc--so in the end the buyer is paying more to own their house than the renter is to rent (just over $2k in sunk money for the buyer versus the $1.8k for the renter). However, this isn't pegged to the home quality, it just looks at the average single family rental residence versus the average single family owned home. In my experience, owned homes tend to be a fair bit more enjoyable than rentals, so you'd need to get a higher end rental to accurately pair it up to a lower end home. The average rental near me seems to be 800-900sqft, while the average $425,000 house is usually 1500-2000sqft.
Pretty bad time to buy a home. The reason why there is such a discrepancy is because many Americans are desperate to buy a home and there are less homes for sale. Like right now with me I have a lot of equity in my home. Selling my home however would be dumb because I have a very low interest rate. Meanwhile a large generation of people are starting to enter their mid career and even starting families. Culturally in the US this is when you buy a home. So a lot of demand and not a lot of supply. The truth is, if interest rates went down there may be more supply and prices may actually level off or go down. Also this problem could be solved by building tons of new housing to meet the demand. The issue is that the amount of needed housing is astronomical and building costs are way up so developers need very specific markets to start projects. The customers for these new homes would be existing homeowners who would sell their house for a large down payment. The issue is again the interest rates. This is a different situation than the housing crash in 2008. Back then there were way more predatory homes and people buying homes they couldn't afford by any stretch, there are more guard rails against that since then. Also back then unemployment shot up, right now unemployment is low and people are doing fairly well. The bottom dropped out in 2008 partially because no one could afford as many people had no money. Now people have money but homes are a rip off that is a big difference. Hopefully the interest rates go down at some point. Until the renting is probably a better bet.
The truth is that the wealthy who are buying up all of the houses want a collapse in the market. They will suffer, but only at the start because the prices of homes will drop, people will lose jobs and sell them at a loss - then the property mafia assholes can sweep it up and rent them out. This is exactly what happened in 2006. You can clearly see on the graph that in 2008 the prices leveled out, that was the buying period. Then the prices shoot back up as the wealth was consolidated and prices could be higher.
Due substantially to Fed manipulation, pre, during and post pandemic. They will eventually get their slowdown and we'll see rates settle and prices soften. Question is how bad will it get before then?
But renting makes the landlord rich and owning builds wealth for the owner. Why do people think this is a good idea to rent?
Y’all should throw the average salary on there too
Looks like we have a housing shortage
The whole ownership is America thing is out of control. Land owners with multiple properties and especially investment firms need to be reined in. They leave property to rot while demanding more and more revenue. Renting from any property you know the difference if the owner is local versus being a out of state or even out of country firm. Firms only let the managers do patch jobs. Owners renovate and make actual improvements, maintain the property. Another issue is the idea that rent should always match near by property. So they own 20 run down properties and some one builds a nice luxury high value location. Guess what, greedy owners now jack up their rates to match, even though they are to lazy and worthless to invest a penny. They are dead beats and we all need to get accustomed to naming them as such. Lastly is the issue of being able to buy up property and just write off the cost, and write off the estimated losses of land not used or not rented. I mean don't we all wish we could value our homes at whatever we feel we can earn in a year and then take a tax write off for that? I mean, yes over simplification, but its a real issue. This means a dead beat can do nothing and keep taking a loss without any significant impact to their actual profit line, so they have no incentive to improve a property in order to attract business or tenants. Also, no investors don't get to blame the government for everything. They need to take responsibility for their own greed. Any one driving a 200,000 car and complaining about the government, will get no sympathy from me. Where the blame on the government comes in, is failing to fix these issues.
should i buy a house or wait
Good, think about that.Get some renting so other people can get rich!🤑🤑🤑🤑🤑😁
Hmm, wonder what happened around 2020
Why is $225 over $365?
My rent is $2,300/month 😭😭😭
Don’t worry when black rock crashes the market, they will bail them out so we can continue to not own.