OT - Anyone realtors or mortgage lenders on the board?

[litespeedhuskerfan]

Ha I really did laugh out loud reading your comment. My wife and I have said the exact same thing many times. We live in a pretty nice area of the Denver metro area (Parker)....our neighborhood's average jome prices are prob 800k, maybe more. The outward appearance of our neighborhood is that it is an affulent area with residents that are somewhat wealthy....but I know deep down, when I look at all the houses in the neighborhood...prob 25% at a mininum, likely higher, are leveraged to the hilt and live month to month in their expensive homes. I wish financial literacy was a required class in high school and/or college, so many people make decisions that are crippling them financially short and long term.

Bought a Honda Ridgeline from the original owner who lived in Parker about 2 years ago...Super nice folks who met me at the airport with the truck and I drove it back to Omaha...Small world. My in-Laws live in Broomfield, sounds like a similar 'hood.

 

[HBK4life]

Now, I would recommend to people right out of HS or college...

Get a house with 2-3 friends instead of an apt.

I had friends live with me when I got my first house. I think my mortgage was 850 and those guys were paying me a total of 1100 a month. It was a win-win.

Yup. I did the roommate thing in my 20's.

 

[litespeedhuskerfan]

Opportunity cost means what you gave up to sink that money into a house. If you did something else with 500k, or whatever the house cost, would you have made more than 90k in that same period. That's opportunity cost.

Cept 99.9% of homebuyers don't have $500K or even 90K in cash to invest in something else. It's literally either a home or an apartment for about the same money per month, unless you have 6 figures laying around to gamble on another investment? In which case you can afford a house.

 

[TampaBaySkers]

Unrelated, sort of (last week's ACH snafoo for payroll at several large banks)

My wife, who is in administration at Methodist...was not affected but had co workers that were....dude what i'm about to type I cannot believe but its true...they were literally sharing outloud they couldn't put gas in their car Friday morn on the way to work because they needed that paycheck to do so. Unfreaking real somebody with a pro job could be in that position..and even weirder they'd admit it. Openly. Some people are so bad with money they'll never get on top of their finances no matter how much they make.

60% of people living paycheck to paycheck. I think it’s over 40% for people making over $100k.

 

[HBK4life]

60% of people living paycheck to paycheck. I think it’s over 40% for people making over $100k.

Careful. We will both get pissed off and post something political and off to the gulags we go. My next one is a month off.

 

[TampaBaySkers]

Cept 99.9% of homebuyers don't have $500K or even 90K in cash to invest in something else. It's literally either a home or an apartment for about the same money per month, unless you have 6 figures laying around to gamble on another investment? In which case you can afford a house.

Rent is 55% cheaper than buying a house right now though… isn’t that just wild. Who would think renting is better than buying right now for most folks .. next year is going to be a wild ride

 

[litespeedhuskerfan]

Rent is 55% cheaper than buying a house right now though… isn’t that just wild. Who would think renting is better than buying right now for most folks .. next year is going to be a wild ride

I do not agree. Not sure where you live but in Gretna and surrounding area....apt rents are ridiculous.

 

[BTF69]

Yup. I did the roommate thing in my 20's.

It is a blast!

Always someone to chill with, drink with, hit up happy hour with.

 

[TampaBaySkers]

I do not agree. Not sure where you live but in Gretna and surrounding area....apt rents are ridiculous.

It’s true man.. at least nationally. Your local area may make more sense to buy..

It now costs 52% more to buy a home than rent one: ‘Never been a worse time’

The average monthly mortgage payment is a whopping 52% higher than the average monthly rent on a house or apartment — a ratio that hasn’t been this out of whack since before the 2008 ho…

nypost.com

 

[HBK4life]

It is a blast!

Always someone to chill with, drink with, hit up happy hour with.

It was. As I get older, I like peace and quiet. And the freedom to walk around your own house straight shirt cocking it. Winnie the Pooh style!!

 

[dinglefritz]

60% of people living paycheck to paycheck. I think it’s over 40% for people making over $100k.

I had a series 7 securities license and worked for a major Investment firm for a while 25 years ago. It was AMAZING how many people there were buying new Cadillacs every year and shelling out thousands in exclusive country club dues who in their late 50s finally decided they should do some retirement planning!!!!😮😮

 

[Huskers123456]

Look at the difference between 3 and 7 percent. It's insane. If I hadn't locked in at 3 percent 3 years ago I would be fuming at what has happened. Nobody in their right mind is going to sell now and trade a 3 percent for a 7 or 8.

View embedded media

No one should have assumed that mortgage rates would be at 3% forever. The only people that did were either young or stupid. Kind of like people freaking out when the stock market goes down. It's not normal for the stock market to be up 90% of the time.

 

[TampaBaySkers]

I had a series 7 securities license and worked for a major Investment firm for a while 25 years ago. It was AMAZING how many people there were buying new Cadillacs every year and shelling out thousands in exclusive country club dues who in their late 50s finally decided they should do some retirement planning!!!!😮😮

People make tiktok’s bragging about how much their monthly car payment is.. crazy times

 

[RedBaloneyPony]

Look at the difference between 3 and 7 percent. It's insane. If I hadn't locked in at 3 percent 3 years ago I would be fuming at what has happened. Nobody in their right mind is going to sell now and trade a 3 percent for a 7 or 8.

View embedded media

For my same property? absolutely not am I going to trade houses across the street. To move for quality of life is going to cost.

 

[GBRforLife1]

3.5 to 4.75 ain’t bad at all.

Curious….how many years are builders buying down the rates?

It's not an arm, if that's what you're asking.

 

[Denvrhuskr]

You obviously don’t know how a 30 year mortgage is amortized.

Sure do. Not going to argue with you, Run into a lot of know it alls, you seem to be one.

 

[drubendall]

I do not agree. Not sure where you live but in Gretna and surrounding area....apt rents are ridiculous.

They are building multi family like crazy around Omaha too. I don’t see a lot of new construction for single-family homes, but apartments are springing up everywhere.. F that life.

 

[TampaBaySkers]

 

[TampaBaySkers]

I’m a realtor and by federal law we are barred from making comments about the quality of neighborhoods. They don’t want us to make it difficult for people in rough areas to struggle to sell their homes. You can always back out of a contract but you open yourself up to legal action from the sellers. I would contact an attorney familiar with real estate law and talk about your options.

What do you think about the NAR lawsuit? How will it affect the industry ?

 

[dsmalls3]

You lost me at the Crypto comment. Crypto is a speculative vehicle with no actual value basis other than other people pouring real dollars in to it.

Homes have never been a great investment but for some people it’s the only way they would have enough discipline to invest in anything. There’s also the quality of life factor that home ownership can afford families. It’s a more complicated subject than strict ROI. IF it makes you put money away that you would otherwise spend on cars and other toys it’s probably a great investment.

As we’ve seen the past 5 years one positive of home ownership is a hedge against inflation. Right now there’s a large shortage of the 3 bedroom starter home and experts see no way that changes any time soon. Rents are ballooning and we’ve let over 3 million illegals in to this country many of whom are sucking up low end housing.

I'm sorry you don't understand crypto and how it plays into macro-economy. Check back on this one middle/end of 2024. Look at charts of BTC/ETH/SOL right now. Bull market is already technically confirmed and buying in the ranges right now is essentially free money if you sell towards the top of this next cycle (end 2024/early 2025 it will correct back. This is the easiest trade in the history of trading and this will be the 4th run of this cycle dating back to the first BTC bull run.

You lost me at "as we've seen the past 5 years".....which have been a massive run up in the cost of homes due to 40% inflation in our money supply. Ask anybody who bought a home in 2004-2006 how well their home helped them beat inflation, or anybody who bought between Jan 2022 - June 2022.

I've owned a home, sold it last year, and intend to buy another one in the future. It's fantastic. Never gets old living in "my home". That doesn't mean I don't also like my families current rental home of 5 bedroom 2 1/2 baths, for half the cost I'd be paying if I were to buy the house. I sleep well at night knowing if the market get's squirly , it's not going to effect my net worth at all. If I had $1,000,000 lying around and could spare $200k on a down payment and not care if I lose money on my home, sure. Go buy a home. I'm not in that spot yet, and so for me, buying a house right now with the majority of my net worth would be financial suicide.

Rents are actually trending downward, days on market are increasing, median home prices are falling, price decreases are trending upwards. In some areas of the country this is worse, some marginally better.

Altos Market Data for Realtors Market Report for National, USA

The most up-to-date look at housing prices and market trends.

altos.re

And we haven't even hit into a recession yet and the Fed is only going to cut rates through 2025 if 1) something breaks - or, we hit a substantial recession (read - people lose their jobs and have to sell their homes, people's mismanaged 401ks take a big hit and it starts making more and more sense to sell that vacation property we planned to hold into retirement, or all of the AirBNB investments folks made in bull are not peforming and so those get sold off, etc.), or 2) we finally reach a 2% inflation rate which is likely not going to happen through at least 2026, if ever this decade. 24 - 36 months more of 7-8% mortgage rates you can guarantee home prices will start dropping. NOBODY is buying right now. The think the segment can sustain for another 24 - 36 months of this?

The ONLY way you break even on a primary residence is if you assume 7% appreciation. You remove this you are at a loss. Obviously if the value of your home trends down from your loan amount, you are at a really big loss. You also no longer technically even "own" your home. You have no equity so the bank does.

Like all thing investing "it depends" and everybody is going to have a different time horizon and goals for how they want that money to perform. Totally agree owning a home is typically forced saving for a lot of people. But entering a substantial amount of you net worth which is going to be a negative ROI over the next decade if you buy today is irresponsible. Just wait it out right now is all I'm saying.

Also, do you really think the illegal immigrants that are coming into the country have the financial means to buy a home in this environment where you need to make like $200k a year in some markets (or more) to even be able to afford a home mortgage payment? Come on man

 

[dsmalls3]

I’ve got 40-50 years left on earth, I’m buying this place to live a life with my family. Not going to worry about counting crypto with my kids shivering in some cracked out rental lol

Lol you do you. A lot of rentals are not cracked and you only have to wait 2 years.

And why are so many people set on living in only one house to they raise their family in?

 

[dinglefritz]

I'm sorry you don't understand crypto and how it plays into macro-economy. Check back on this one middle/end of 2024. Look at charts of BTC/ETH/SOL right now. Bull market is already technically confirmed and buying in the ranges right now is essentially free money if you sell towards the top of this next cycle (end 2024/early 2025 it will correct back. This is the easiest trade in the history of trading and this will be the 4th run of this cycle dating back to the first BTC bull run.

You lost me at "as we've seen the past 5 years".....which have been a massive run up in the cost of homes due to 40% inflation in our money supply. Ask anybody who bought a home in 2004-2006 how well their home helped them beat inflation, or anybody who bought between Jan 2022 - June 2022.

I've owned a home, sold it last year, and intend to buy another one in the future. It's fantastic. Never gets old living in "my home". That doesn't mean I don't also like my families current rental home of 5 bedroom 2 1/2 baths, for half the cost I'd be paying if I were to buy the house. I sleep well at night knowing if the market get's squirly , it's not going to effect my net worth at all. If I had $1,000,000 lying around and could spare $200k on a down payment and not care if I lose money on my home, sure. Go buy a home. I'm not in that spot yet, and so for me, buying a house right now with the majority of my net worth would be financial suicide.

Rents are actually trending downward, days on market are increasing, median home prices are falling, price decreases are trending upwards. In some areas of the country this is worse, some marginally better.

Altos Market Data for Realtors Market Report for National, USA

The most up-to-date look at housing prices and market trends.

altos.re

And we haven't even hit into a recession yet and the Fed is only going to cut rates through 2025 if 1) something breaks - or, we hit a substantial recession (read - people lose their jobs and have to sell their homes, people's mismanaged 401ks take a big hit and it starts making more and more sense to sell that vacation property we planned to hold into retirement, or all of the AirBNB investments folks made in bull are not peforming and so those get sold off, etc.), or 2) we finally reach a 2% inflation rate which is likely not going to happen through at least 2026, if ever this decade. 24 - 36 months more of 7-8% mortgage rates you can guarantee home prices will start dropping. NOBODY is buying right now. The think the segment can sustain for another 24 - 36 months of this?

The ONLY way you break even on a primary residence is if you assume 7% appreciation. You remove this you are at a loss. Obviously if the value of your home trends down from your loan amount, you are at a really big loss. You also no longer technically even "own" your home. You have no equity so the bank does.

Like all thing investing "it depends" and everybody is going to have a different time horizon and goals for how they want that money to perform. Totally agree owning a home is typically forced saving for a lot of people. But entering a substantial amount of you net worth which is going to be a negative ROI over the next decade if you buy today is irresponsible. Just wait it out right now is all I'm saying.

Also, do you really think the illegal immigrants that are coming into the country have the financial means to buy a home in this environment where you need to make like $200k a year in some markets (or more) to even be able to afford a home mortgage payment? Come on man

I understand crypto completely. It’s not backed by anything other than continued speculative buying.

Did I say illegals were buying up lots of houses? In some cases they are. Not all illegals are wading across the Rio Grande. What’s happening in many cases is they’re renting up low cost housing at higher rates through intermediaries. There’s a reason there’s a surge in 2 bedroom large apartment complexes.

Whole neighborhoods in cities are turning in to non-English speaking enclaves due to being taken over by large numbers of illegal immigrants. There are basically human brokers whose businesses hire illegal immigrants and find housing for them. Lots of off the books cash transactions are the norm.

In my sister’s old neighborhood in CA it would start with one guy buying a house in a gated community and renting it out. Within 2 years that whole neighborhood would be sold to the slum lords and be filled with illegal renters.

 

[Huskers123456]

Lol you do you. A lot of rentals are not cracked and you only have to wait 2 years.

And why are so many people set on living in only one house to they raise their family in?

Can't speak for anyone else but I personally hate moving. Did the rental thing when I was younger, while searching for my dream home. I guess I could technically move into a newer, bigger house but the one I live in right now has everything we want or need and I would rather pour extra money into retirement rather than a house.

My problem with renting is that 10+ years ago I was saving 13% by renting, not including home maintenance. After 10+ years that number is at 30%, if rent hasn't gone up on that house, which I'm positive it has. But I'm over 1/3 of the way towards paying off a mortgage.

 

[redli]

Lol you do you. A lot of rentals are not cracked and you only have to wait 2 years.

And why are so many people set on living in only one house to they raise their family in?

Moving sucks, is expensive, and once your kids are school age and have neighborhood friends, schools they like, etc. why bother moving them? It's a crapshoot if you go from a good situation to a place with crazy neighbors, questionable schools, etc.

 

[dsmalls3]

Moving sucks, is expensive, and once your kids are school age and have neighborhood friends, schools they like, etc. why bother moving them? It's a crapshoot if you go from a good situation to a place with crazy neighbors, questionable schools, etc.

Agreed. If you are already into a home, especially at low interest rate, sit tight. Like you said, especially with kids in school with friends. If I had a home that fit my family and I was in with low rates, I’d stay in until the kids move out. We unfortunately bought before we had our kids and outgrew our home.

Thought the discussion was around buying a new home now.

 

[dsmalls3]

Can't speak for anyone else but I personally hate moving. Did the rental thing when I was younger, while searching for my dream home. I guess I could technically move into a newer, bigger house but the one I live in right now has everything we want or need and I would rather pour extra money into retirement rather than a house.

My problem with renting is that 10+ years ago I was saving 13% by renting, not including home maintenance. After 10+ years that number is at 30%, if rent hasn't gone up on that house, which I'm positive it has. But I'm over 1/3 of the way towards paying off a mortgage.

Moving does indeed suck. I say that having moved 12 times in the last 12 years (4 different states, 3 different countries). You get really good at getting rid of stuff which is nice.

It’s been a wild ride, but plan is to buy one final house to raise my family.

My argument for renting is it’s better to rent now, if you don’t already own a home. If US real estate cycle last 120 years remains consistent, there will be a fire sale of housing in the next 5 years. Would rather rent until that event, and be in a position to really capitalize and take a ride for the next 18 year cycle.