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I'm a new immigrant to the US, and housing is my single biggest worry together with my work visa. Our household income is north of 300k, but housing still seem

I'm a new immigrant to the US, and housing is my single biggest worry together with my work visa. Our household income is north of 300k, but housing still seems unaffordable. It might sound like whining, but we only achieve this level of income recently, so our lifelong savings are in the low 6 figures. We got no assets or property abroad, and no family that can help us to get in the property ladder. Even old, basic houses in our suburbs outside town go for ~$1M. I spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible. My current plan involves saving for a few years and dump a good chunk of cash into a down payment; it doesn't seem we could ever afford a property otherwise. I wonder how property prices affect "the american dream". It's baffling to me that I'm so worried about housing while making a top ~5% income.

turtlebits 4y ago
I'm not sure if I believe this. The places you "want" to live may cost 1M+, but I refuse to believe that if you just go another 15 minutes out (or add 15 mins to your commute), you can't get something for 2/3 of the price.
- swearwolf 4y ago
  In the greater Seattle area you need to travel quite far out to cut the price by any significant amount. There are some very basic suburban houses in Bellevue, Kirkland and Issaquah selling for upwards of $2 million, and those are a good 15-20 miles away from the city itself. If you don’t believe it, pull up Zillow or Redfin and set a price threshold under $1M and see how many listings instantly disappear. If you want a good laugh, take a look at what’s left.
int_19h 4y ago
You can get cheaper housing further east from Seattle, past Issaquah (Preston, Snoqualmie, North Bend, Fall City, Carnation etc) if 40-50 minute commute is acceptable. Snoqualmie in particular is seeing a lot of new development in the past few years because of this.
eddsh1994 4y ago
Are you in the Bay Area? If so I saw an ad in SF for condos/1 bed flats starting at high $300k on the weekend. With recent zoning changes it might get easier for you soon.
- zjp 4y ago
  Those condos are likely to be reserved as Below Market Rate housing stock for households making somewhere around the area median income (who, honestly, still can't afford them). You get the same incentive structure that the medicaid gap created. It's very frustrating to be /in/ the gap. Bay Area homeowners act like the apocalypse is coming if increased supply means poors who /only/ make 100k are allowed to buy next to them. The horror. The humanity.
- angarg12 4y ago
  Nope, Greater Seattle Area. Still, we are a couple nearing our 40s, it seems insane to me that we need to "settle down" for a 1 bedroom flat while making ~3x the median local income.
  - mfer 4y ago
    There are a few areas where housing values are massively higher than the rest of the country. You are in one of them. Have you looked at how many people need to commute there to work because they can’t afford to live there
  - eddsh1994 4y ago
    Oh I agree! But better to avoid renting in general imo, if it’s a possibility.
    - fallingknife 4y ago
      Not correct. In most HCOL cities in the US, you can rent space for less than the equivalent cost to own. https://www.nytimes.com/2022/06/23/realestate/owning-renting-disparity.html https://www.nytimes.com/2022/06/23/realestate/owning-renting...
swatcoder 4y ago
> My current plan involves saving for a few years and dump a good chunk of cash into a down payment That's exactly the on-paper ideal for how one comes to buy a home here. With rents soaking available income, and a high average debt load because of education costs, most young American's now struggle to see any non-negligible growth in their savings until later in life (if then). If you have substantial savings and anticipate growing it further in the near future, you're already winning the game. You're fine.
deleted 4y ago
[deleted]
korroziya 4y ago
Most working class people die with savings below five figures. You should re-evaluate how good you're doing. Of course, if you live in California or New York, you're basically broke, since the cost of living in those states is designed to keep people poor. But that's why people left those two states in droves over the last few years.
- vore 4y ago
  I don't think the parent post was punching down on working class people, but rather making the point that if housing is unaffordable for even someone with a 300k household income, it is truly catastrophic for people on the average wage.
  - angarg12 4y ago
    Thank you for this comment, in case someone misunderstood my original post. I'm from a working class family myself. My parents were factory workers, and they managed to buy a new 4 bed apartment in a new part of town and raise 3 children. And yet I don't feel I'm doing materially better than my parents at my age. I definitely don't feel upper middle class even if my income suggest so. As you point out I can't imagine how people with more average incomes get by.
- danaris 4y ago
  New York City. New York State, once you get outside the city, is a fairly average state with a lot of rural area that has moderate-to-low cost of living. I would venture to say that more land area of California is in the "unaffordable to average people" range than that in New York, either as an absolute or as a percentage of the state.
bityard 4y ago
I don't mean to be blunt, but if modest homes in your area are $1m, then you are in a VERY high-cost-of-living area and what you see here is not at all typical of the rest of the country. Where I live, a charming 1200sqft starter home in a blue collar neighborhood goes for $150-$200k.
- vjk800 4y ago
  Indeed. If your complaint is that you need to be a millionaire to get basic housing, it's because you live with other rich people. Since the overwhelming majority of humanity lives in houses with value far below 1M$, we can conclude that no-one really has to live in a place with only 1M$ houses, but you, for some reason, want to do so. Living in a posh neighbourhood is a luxury, like Ferrari (which, by the way, costs much less) or a golden watch. If you want rich people lifestyle, then you should be prepared to pay rich people money for it.
  - ok_dad 4y ago
    > If your complaint is that you need to be a millionaire to get basic housing, it's because you live with other rich people. Hawaii would like to have a word with you, unless you suggest every single non-rich local would just have to move to the mainland. I believe the cheapest home I've seen available, where the neighbors aren't cooking meth, is probably in the $500-600k range and going up.
    - kyllo 4y ago
      That is also happening--lots of Hawaiians are being forced to move to the mainland because they can't afford housing in their home state. https://news.yahoo.com/native-hawaiians-flock-las-vegas-135728852.html https://news.yahoo.com/native-hawaiians-flock-las-vegas-1357...
  - dinvlad 4y ago
    The sad reality of it is such expensive neighborhoods as we see on east and west coasts, don't actually _feel_ luxurious - there's barely enough infrastructure and convenience associated with them, compared to living far away. The standard of living just isn't as high as the price.
wil421 4y ago
$300k is a very very good family income and is in the top 90% if not more. Even if you just got the job you should be able to afford a house. $1m for an old suburban house is very high for most places in the US.
difflens 4y ago
The worry is understandable. As someone who's been in a similar situation before, the worry with a work visa and housing tends to go away one way or another. Either you get out of a work visa at some point, or you accept that you will never receive a green card in your productive years and you jump into the property market with that risk anyway.
fallingknife 4y ago
So don't buy. $300K is enough to easily afford rent. And if you compare what you pay to rent vs cost to own equivalent in the Bay Area, in most places renting is actually cheaper. https://www.nytimes.com/2022/06/23/realestate/owning-renting-disparity.html https://www.nytimes.com/2022/06/23/realestate/owning-renting...
s1artibartfast 4y ago
What exactly seems to be the problem or concern? With 300k income you should be able to save a 200k/20% down payment in a year, especially if you have 6 figures already. With todays rates you looking at 70k/year mortgage and <25% of your income.
- yawnr 4y ago
  What…? 300K post taxes is basically 150K, the are probably paying 60K+ in rent and another 30+ in other basic cost of living expenses.
  - s1artibartfast 4y ago
    If you take your numbers at face value and don't try to cut costs, that is still 60k savings per year and would take 2 years instead of 1 to hit a down payment. If you take the mortgage interest tax deduction, you will be spending about 35k/yr less on taxes and have more disposable income relative than renting at 60k/yr rent VS (70k mortgage - 35k less taxes). If two years is too long for the road map, you can rent a room in Palo Alto for 15k/yr or a 1Br apartment for 30k/yr. If you are paying a 50% tax rate, I would also look at tax avoidance strategies. Maxing out the 401k and HSAs to get that down. Each person can always borrow 50k back from the 401 account to put toward the down payment.
    - angarg12 4y ago
      Cost of living is definitely much bigger than you make it to be. Just paying rent, car, bills, etc. easily cost 5k a month. A good chunk of my comp is stocks, which could go up or down with time, so a bit of a wildcard there. My wife is a freelancer, and she can bring home anywhere from 1k-10k each month depending on the market (and market is REALLY bad now), so can't count on that. I might be able to save all my stocks, pray that they don't go down any further, and cash all of them for a down payment. Then I have to pray to not have any unexpected emergency or lose my job, since I dumped most of my life savings in a down payment. Hardly what i'd call a middle class lifestyle.
MarcoZavala 4y ago
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notlukesky 4y ago
The irony is that the influx of millions of foreigners to urban areas increases the demand for existing housing stock whilst the same people who are for millions of immigrants are against new housing built. The price pressure will only be upwards and benefits the existing landlords (and the big funds who own property like Carlyle and BlackRock and are big political donors).
- dinvlad 4y ago
  I think the positive net affect of immigration on the economy far outweighs any negatives associated with it.
  - notlukesky 4y ago
    The response was specifically about housing costs. Nothing at all to do with other negative or positive externalities.
tchaffee 4y ago
> I spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible You buy a cheap house far away from where you work, and rent it to someone. Let them pay your mortgage and before you know it, you've got enough equity to put towards another house. Rinse and repeat.
- sethd 4y ago
  Is this path still actually viable for HCOL areas? I remember having a conversation with a real estate developer in SF in 2021. They said that this used to be the path to owning in places like SF, but that it’s no longer a viable option.
  - prawn 4y ago
    If you're renting out the house, does it need to be in a HCOL area and does it need to be just one house? It goes against the idea of 'housing as investment being a negative thing' though.
  - zamnos 4y ago
    I'd say not right this instant, given interest rates. But if you really want to, look for condos out by, like, American Canyon or Vallejo or similarly far out locations. 20% down for a $300k place is $60k. Which, while being a good chunk of change, isn't as far out of reach as the $200k down payment for a million dollar condo in SF. Before you do the investment property thing though, make sure being a property manager is truely how you want to spend your life. Investing money into financial instruments is a lot less work these days, what with robo advisors platforms (eg wealthfront, betterment) providing easy places to invest from.
  - tchaffee 4y ago
    I doubt it. I said "far away" meaning buy in a low cost of living area. Especially one that is popular and growing. Although it's convenient to live in your first property investment, it's not a requirement. Rent near work as cheaply as possible but very likely in a neighborhood where you can't afford to buy. And buy somewhere else.
ashwagary 4y ago
>I'm a new immigrant to the US In your position, I would recommend renting as long as possible until house price correct in maybe 2-5 years. There is no reason to feed the bubble on already massively inflated properties with your hard earned money.
- gniv 4y ago
  Agree, but with the caveat that the prices might not come down at all. But still I think that's ok. What will come down are the interest rates, and right now you can make 5+% risk-free on savings, so it makes sense to keep renting and saving.
tradertef 4y ago
Sorry but you are whining.
albertopv 4y ago
Dude, italian SWE, you are already much richer than I will ever hope to bw.

turtlebits 4y ago

I'm not sure if I believe this. The places you "want" to live may cost 1M+, but I refuse to believe that if you just go another 15 minutes out (or add 15 mins to your commute), you can't get something for 2/3 of the price.

swearwolf 4y ago
In the greater Seattle area you need to travel quite far out to cut the price by any significant amount. There are some very basic suburban houses in Bellevue, Kirkland and Issaquah selling for upwards of $2 million, and those are a good 15-20 miles away from the city itself. If you don’t believe it, pull up Zillow or Redfin and set a price threshold under $1M and see how many listings instantly disappear. If you want a good laugh, take a look at what’s left.

int_19h 4y ago

You can get cheaper housing further east from Seattle, past Issaquah (Preston, Snoqualmie, North Bend, Fall City, Carnation etc) if 40-50 minute commute is acceptable. Snoqualmie in particular is seeing a lot of new development in the past few years because of this.

eddsh1994 4y ago

Are you in the Bay Area? If so I saw an ad in SF for condos/1 bed flats starting at high $300k on the weekend. With recent zoning changes it might get easier for you soon.

zjp 4y ago
Those condos are likely to be reserved as Below Market Rate housing stock for households making somewhere around the area median income (who, honestly, still can't afford them). You get the same incentive structure that the medicaid gap created. It's very frustrating to be /in/ the gap. Bay Area homeowners act like the apocalypse is coming if increased supply means poors who /only/ make 100k are allowed to buy next to them. The horror. The humanity.
angarg12 4y ago
Nope, Greater Seattle Area. Still, we are a couple nearing our 40s, it seems insane to me that we need to "settle down" for a 1 bedroom flat while making ~3x the median local income.
- mfer 4y ago
  There are a few areas where housing values are massively higher than the rest of the country. You are in one of them. Have you looked at how many people need to commute there to work because they can’t afford to live there
- eddsh1994 4y ago
  Oh I agree! But better to avoid renting in general imo, if it’s a possibility.
  - fallingknife 4y ago
    Not correct. In most HCOL cities in the US, you can rent space for less than the equivalent cost to own. https://www.nytimes.com/2022/06/23/realestate/owning-renting-disparity.html https://www.nytimes.com/2022/06/23/realestate/owning-renting...

swatcoder 4y ago

> My current plan involves saving for a few years and dump a good chunk of cash into a down payment That's exactly the on-paper ideal for how one comes to buy a home here. With rents soaking available income, and a high average debt load because of education costs, most young American's now struggle to see any non-negligible growth in their savings until later in life (if then). If you have substantial savings and anticipate growing it further in the near future, you're already winning the game. You're fine.

deleted 4y ago

[deleted]

korroziya 4y ago

Most working class people die with savings below five figures. You should re-evaluate how good you're doing. Of course, if you live in California or New York, you're basically broke, since the cost of living in those states is designed to keep people poor. But that's why people left those two states in droves over the last few years.

vore 4y ago
I don't think the parent post was punching down on working class people, but rather making the point that if housing is unaffordable for even someone with a 300k household income, it is truly catastrophic for people on the average wage.
- angarg12 4y ago
  Thank you for this comment, in case someone misunderstood my original post. I'm from a working class family myself. My parents were factory workers, and they managed to buy a new 4 bed apartment in a new part of town and raise 3 children. And yet I don't feel I'm doing materially better than my parents at my age. I definitely don't feel upper middle class even if my income suggest so. As you point out I can't imagine how people with more average incomes get by.
danaris 4y ago
New York City. New York State, once you get outside the city, is a fairly average state with a lot of rural area that has moderate-to-low cost of living. I would venture to say that more land area of California is in the "unaffordable to average people" range than that in New York, either as an absolute or as a percentage of the state.

bityard 4y ago

I don't mean to be blunt, but if modest homes in your area are $1m, then you are in a VERY high-cost-of-living area and what you see here is not at all typical of the rest of the country. Where I live, a charming 1200sqft starter home in a blue collar neighborhood goes for $150-$200k.

vjk800 4y ago
Indeed. If your complaint is that you need to be a millionaire to get basic housing, it's because you live with other rich people. Since the overwhelming majority of humanity lives in houses with value far below 1M$, we can conclude that no-one really has to live in a place with only 1M$ houses, but you, for some reason, want to do so. Living in a posh neighbourhood is a luxury, like Ferrari (which, by the way, costs much less) or a golden watch. If you want rich people lifestyle, then you should be prepared to pay rich people money for it.
- ok_dad 4y ago
  > If your complaint is that you need to be a millionaire to get basic housing, it's because you live with other rich people. Hawaii would like to have a word with you, unless you suggest every single non-rich local would just have to move to the mainland. I believe the cheapest home I've seen available, where the neighbors aren't cooking meth, is probably in the $500-600k range and going up.
  - kyllo 4y ago
    That is also happening--lots of Hawaiians are being forced to move to the mainland because they can't afford housing in their home state. https://news.yahoo.com/native-hawaiians-flock-las-vegas-135728852.html https://news.yahoo.com/native-hawaiians-flock-las-vegas-1357...
- dinvlad 4y ago
  The sad reality of it is such expensive neighborhoods as we see on east and west coasts, don't actually _feel_ luxurious - there's barely enough infrastructure and convenience associated with them, compared to living far away. The standard of living just isn't as high as the price.

wil421 4y ago

$300k is a very very good family income and is in the top 90% if not more. Even if you just got the job you should be able to afford a house. $1m for an old suburban house is very high for most places in the US.

difflens 4y ago

The worry is understandable. As someone who's been in a similar situation before, the worry with a work visa and housing tends to go away one way or another. Either you get out of a work visa at some point, or you accept that you will never receive a green card in your productive years and you jump into the property market with that risk anyway.

fallingknife 4y ago

So don't buy. $300K is enough to easily afford rent. And if you compare what you pay to rent vs cost to own equivalent in the Bay Area, in most places renting is actually cheaper. https://www.nytimes.com/2022/06/23/realestate/owning-renting-disparity.html https://www.nytimes.com/2022/06/23/realestate/owning-renting...

s1artibartfast 4y ago

What exactly seems to be the problem or concern? With 300k income you should be able to save a 200k/20% down payment in a year, especially if you have 6 figures already. With todays rates you looking at 70k/year mortgage and <25% of your income.

yawnr 4y ago
What…? 300K post taxes is basically 150K, the are probably paying 60K+ in rent and another 30+ in other basic cost of living expenses.
- s1artibartfast 4y ago
  If you take your numbers at face value and don't try to cut costs, that is still 60k savings per year and would take 2 years instead of 1 to hit a down payment. If you take the mortgage interest tax deduction, you will be spending about 35k/yr less on taxes and have more disposable income relative than renting at 60k/yr rent VS (70k mortgage - 35k less taxes). If two years is too long for the road map, you can rent a room in Palo Alto for 15k/yr or a 1Br apartment for 30k/yr. If you are paying a 50% tax rate, I would also look at tax avoidance strategies. Maxing out the 401k and HSAs to get that down. Each person can always borrow 50k back from the 401 account to put toward the down payment.
  - angarg12 4y ago
    Cost of living is definitely much bigger than you make it to be. Just paying rent, car, bills, etc. easily cost 5k a month. A good chunk of my comp is stocks, which could go up or down with time, so a bit of a wildcard there. My wife is a freelancer, and she can bring home anywhere from 1k-10k each month depending on the market (and market is REALLY bad now), so can't count on that. I might be able to save all my stocks, pray that they don't go down any further, and cash all of them for a down payment. Then I have to pray to not have any unexpected emergency or lose my job, since I dumped most of my life savings in a down payment. Hardly what i'd call a middle class lifestyle.

MarcoZavala 4y ago

[dead]

notlukesky 4y ago

The irony is that the influx of millions of foreigners to urban areas increases the demand for existing housing stock whilst the same people who are for millions of immigrants are against new housing built. The price pressure will only be upwards and benefits the existing landlords (and the big funds who own property like Carlyle and BlackRock and are big political donors).

dinvlad 4y ago
I think the positive net affect of immigration on the economy far outweighs any negatives associated with it.
- notlukesky 4y ago
  The response was specifically about housing costs. Nothing at all to do with other negative or positive externalities.

tchaffee 4y ago

> I spend an inordinate amount of mental energy calculating how we can jump into the property ladder as quickly and safely as possible You buy a cheap house far away from where you work, and rent it to someone. Let them pay your mortgage and before you know it, you've got enough equity to put towards another house. Rinse and repeat.

sethd 4y ago
Is this path still actually viable for HCOL areas? I remember having a conversation with a real estate developer in SF in 2021. They said that this used to be the path to owning in places like SF, but that it’s no longer a viable option.
- prawn 4y ago
  If you're renting out the house, does it need to be in a HCOL area and does it need to be just one house? It goes against the idea of 'housing as investment being a negative thing' though.
- zamnos 4y ago
  I'd say not right this instant, given interest rates. But if you really want to, look for condos out by, like, American Canyon or Vallejo or similarly far out locations. 20% down for a $300k place is $60k. Which, while being a good chunk of change, isn't as far out of reach as the $200k down payment for a million dollar condo in SF. Before you do the investment property thing though, make sure being a property manager is truely how you want to spend your life. Investing money into financial instruments is a lot less work these days, what with robo advisors platforms (eg wealthfront, betterment) providing easy places to invest from.
- tchaffee 4y ago
  I doubt it. I said "far away" meaning buy in a low cost of living area. Especially one that is popular and growing. Although it's convenient to live in your first property investment, it's not a requirement. Rent near work as cheaply as possible but very likely in a neighborhood where you can't afford to buy. And buy somewhere else.

ashwagary 4y ago

>I'm a new immigrant to the US In your position, I would recommend renting as long as possible until house price correct in maybe 2-5 years. There is no reason to feed the bubble on already massively inflated properties with your hard earned money.

gniv 4y ago
Agree, but with the caveat that the prices might not come down at all. But still I think that's ok. What will come down are the interest rates, and right now you can make 5+% risk-free on savings, so it makes sense to keep renting and saving.

tradertef 4y ago

Sorry but you are whining.

albertopv 4y ago

Dude, italian SWE, you are already much richer than I will ever hope to bw.