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I wouldn't buy a house now if I could help it. It only seems reasonable because of extremely low rates. That is also the same thing driving equity valuations in
by throwaway5752 5y ago
I wouldn't buy a house now if I could help it. It only seems reasonable because of extremely low rates. That is also the same thing driving equity valuations in our field to historically unusual levels. This is partially driven by market and partially driven by monetary policy, and it really can't go much lower than it is. Rate increases have a large increase on the present value of a mortgage of stock.
- almost_usual 5y agoI didn’t bet on this, have excess funds and pulled the trigger last month and closed on a home where I want to be. I don’t think I’d care if the price dropped 50% tomorrow, I’m where I want to be in the long run and my rate is a near record low.
- throwaway5752 5y agoBuy a house because you want one, and because you like the specific house. Just not because it's an investment or FOMO. If you pay $100,000 more than you would at a 100 higher basis points, but you live in it 20 years you will certainly build back equity and hedge yourself against rents to make up the difference. There are places where home prices are just getting back to where they were in 2006, though. You can certainly end up underwater on a mortgage and stuck. Property taxes, insurance, and maintenance are high fixed costs with a home.