4 ms·

Sounds like you are in some sort of echo chamber where you perceive everyone who isn’t filthy rich as living in poverty.

EvanAnderson 6y ago
I, too, am wondering how people are affording these houses. I'm not "filthy rich", but my income hasn't changed significantly in the last 15 years. I don't know others who feel they have had significant income increases either. OTOH, in my area (semi-rural Ohio) these new houses are costing at least 1.75X (and some _much_ more) what similar houses cost 15 years ago. Stuff that went for $120 - $150K 15 years ago is running north of $250K now.
- lallysingh 6y ago
  Financing has gotten really cheap. That'll get you more house for your dollar. People have been building equity on their homes the entire time. Those folks who are selling their $150k houses for $250k are buying other houses, further raising demand.
  - jacobush 6y ago
    That gives you more dollars per house, you mean.
    - lallysingh 6y ago
      I mean that the folks living in a house that's appreciated a lot may want to cash out their equity, adding another buyer and a bunch of money to the market.
- AlexTWithBeard 6y ago
  $250k less 10% downpayment assuming 3% interest rate for 30 years yields about $1300 per month payments which is $15600 per year. With median household income in Ohio being around 56k, spending 15k on a house looks affordable.
- chrisseaton 6y ago
  > I, too, am wondering how people are affording these houses. They have normal middle-class jobs. A pair of professional salaries almost anywhere should be able to afford a $250K mortgage. I think most middle-class people wish their mortgage was only $250K.
- tcbawo 6y ago
  That magnitude of price increase translates to about ~3.5% annualized increase, which seems indicative of a relatively healthy inflation adjustment. Many parts of the Midwest have been accustomed to stagnant home prices due to decades of economic underinvestment and declining population. For a variety of reasons, this is turning around.

EvanAnderson 6y ago

I, too, am wondering how people are affording these houses. I'm not "filthy rich", but my income hasn't changed significantly in the last 15 years. I don't know others who feel they have had significant income increases either. OTOH, in my area (semi-rural Ohio) these new houses are costing at least 1.75X (and some _much_ more) what similar houses cost 15 years ago. Stuff that went for $120 - $150K 15 years ago is running north of $250K now.

lallysingh 6y ago
Financing has gotten really cheap. That'll get you more house for your dollar. People have been building equity on their homes the entire time. Those folks who are selling their $150k houses for $250k are buying other houses, further raising demand.
- jacobush 6y ago
  That gives you more dollars per house, you mean.
  - lallysingh 6y ago
    I mean that the folks living in a house that's appreciated a lot may want to cash out their equity, adding another buyer and a bunch of money to the market.
AlexTWithBeard 6y ago
$250k less 10% downpayment assuming 3% interest rate for 30 years yields about $1300 per month payments which is $15600 per year. With median household income in Ohio being around 56k, spending 15k on a house looks affordable.
chrisseaton 6y ago
> I, too, am wondering how people are affording these houses. They have normal middle-class jobs. A pair of professional salaries almost anywhere should be able to afford a $250K mortgage. I think most middle-class people wish their mortgage was only $250K.
tcbawo 6y ago
That magnitude of price increase translates to about ~3.5% annualized increase, which seems indicative of a relatively healthy inflation adjustment. Many parts of the Midwest have been accustomed to stagnant home prices due to decades of economic underinvestment and declining population. For a variety of reasons, this is turning around.