2 ms·
Not in my experience (3 houses so far, early 30s). The way I’ve seen markets move is that certain price bands are more susceptible to fluctuations than others.
by ryanSrich 5y ago
Not in my experience (3 houses so far, early 30s).
The way I’ve seen markets move is that certain price bands are more susceptible to fluctuations than others. For example, over the course of a 4 year period you might see the entry point for the market go from $400k to $500k, while the $500-$600k band sees a 30% increase, the $700-$800 band sees a 20% increase, and the $900-$1m sees a 10% increase.
So while the entire market is moving up, certain bands become more affordable if you can capitalize on a higher percentage band.
- secabeen 5y agoThe other element is leverage. If you put 20% down (which is higher than average), you are levered 5:1. If all houses double in value, your equity goes up 5x. (Example: $100k down on a $500k house; price doubles to $1mil, your equity is now $600k; you can now easily afford 20% down on the higher price house, despite the fact that it is now $2,000k from $1,000k when you started the process.)