7 ms·

My grandparents bought their house on the SJC - Los Gatos border for $30k in 1968. It sold in 2019 for $1.4M. That's what piggyback second mortgages are for. T

My grandparents bought their house on the SJC - Los Gatos border for $30k in 1968. It sold in 2019 for $1.4M. That's what piggyback second mortgages are for. There are also subsidized loans for first-time buyers in the US called FHA loans that allow 3.5% to 10% down payments.

chii 5y ago
> $30k in 1968. It sold in 2019 for $1.4M. and the same $30k invested in the S&P 500 in 1968 would have earned you 186x - or $5,580,000 (using http://www.moneychimp.com/features/market_cagr.htm http://www.moneychimp.com/features/market_cagr.htm as a guide to calculate returns). And yet, nobody bats an eye that this amazing returns of stocks, and continues to complain that housing prices are too high today, when it was "cheap" in the past. But was it really cheap in the past?
- temp8964 5y ago
  But you can't live inside stocks. House is not just investment.
  - failwhaleshark 5y ago
    Inelastic demand items: housing.. like water, food, heating. I guess my grandparents could've squatted in the Santa Cruz mountains for a while and kept saving to buy stocks. ;-)
- deepnotderp 5y ago
  But I don’t need stocks in order to survive. I do need shelter though. As long as housing is seen as an investment it’s not going to be affordable.
  - chii 5y ago
    you don't need to own property to live there - you can rent. Buying and owning property will always be an investment. If this investment is worth it (aka, it has outsized returns), then it can not be affordable.
    - jjav 5y ago
      > you don't need to own property to live there - you can rent. Look up rents in the 60s in Los Gatos vs. rents recently to see what a terrible idea that would've been for those people.
    - deepnotderp 5y ago
      I’m gonna go ahead and guess rising prices also means higher rents
- failwhaleshark 5y ago
  They bought it using the GI Bill loan assistance program. They didn't have anywhere near $30k in savings.
- jjav 5y ago
  > > $30k in 1968. It sold in 2019 for $1.4M. > and the same $30k invested in the S&P 500 in 1968 would have earned you 186x OPs grandparents would have a difficult time living under a stock certificate. Housing is to live in, can't compare it to stocks. Unless you plan to be stock-rich but homeless.

chii 5y ago

> $30k in 1968. It sold in 2019 for $1.4M. and the same $30k invested in the S&P 500 in 1968 would have earned you 186x - or $5,580,000 (using http://www.moneychimp.com/features/market_cagr.htm http://www.moneychimp.com/features/market_cagr.htm as a guide to calculate returns). And yet, nobody bats an eye that this amazing returns of stocks, and continues to complain that housing prices are too high today, when it was "cheap" in the past. But was it really cheap in the past?

temp8964 5y ago
But you can't live inside stocks. House is not just investment.
- failwhaleshark 5y ago
  Inelastic demand items: housing.. like water, food, heating. I guess my grandparents could've squatted in the Santa Cruz mountains for a while and kept saving to buy stocks. ;-)
deepnotderp 5y ago
But I don’t need stocks in order to survive. I do need shelter though. As long as housing is seen as an investment it’s not going to be affordable.
- chii 5y ago
  you don't need to own property to live there - you can rent. Buying and owning property will always be an investment. If this investment is worth it (aka, it has outsized returns), then it can not be affordable.
  - jjav 5y ago
    > you don't need to own property to live there - you can rent. Look up rents in the 60s in Los Gatos vs. rents recently to see what a terrible idea that would've been for those people.
  - deepnotderp 5y ago
    I’m gonna go ahead and guess rising prices also means higher rents
failwhaleshark 5y ago
They bought it using the GI Bill loan assistance program. They didn't have anywhere near $30k in savings.
jjav 5y ago
> > $30k in 1968. It sold in 2019 for $1.4M. > and the same $30k invested in the S&P 500 in 1968 would have earned you 186x OPs grandparents would have a difficult time living under a stock certificate. Housing is to live in, can't compare it to stocks. Unless you plan to be stock-rich but homeless.