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Americans Are Getting Priced Out of Homeownership at Record Rates

26 points by littlexsparkee 1y ago

Ericson2314 1y ago
[flagged]
- DaveZale 1y ago
  But don't condos tend to involve HOAs, which are often overpriced and corrupt? I swore off renting and HOAs many years ago. But for city life, there's not much of a choice, absoulutely.
  - Ericson2314 1y ago
    Many HOAs do suck, but density unfortunately does require greater coordination amount residents. Either the residents do it themselves, or the landlord does it. Single stair allowing narrower buildings side by side ameliorates them problem though, in that the units of coordination are much smaller.
    - more_corn 1y ago
      Having a hoa fee also changes your mortgage math.
    - gizmo686 1y ago
      Or the local government does it. Which is one of the reasons HOAs took of. Local governments realized that they could avoid work if they required developers to created HOAs to take care of that pesky local governance.
  - gizmo686 1y ago
    It is far more common for HOAs to be under priced and neglected. They are run by elected volunteers (from member homeowners); and approximately no one wants to volunteer. What everyone does want is lower dues. When combined with the minimal effort that goes into running most HOAs, this tends to cause them to reduce dues by neglecting maintenance and emergency reserves. Then, when the bill comes due, they need to issue a large special assessment to cover the cost.
- chickenzzzzu 1y ago
  Sorry, dense housing is loud, smelly, and dangerous. You can't force me to live in a prison like that. The world simply needs less people. Trying to cram more people into less space is inhumane.
  - more_corn 1y ago
    There are plenty of open spaces outside of cities.
  - heathrow83829 1y ago
    This! i don't see how people think it's acceptable to cram people together like livestock when they object to the same conditions happening to chicken livestock.
  - Ericson2314 1y ago
    Get excited, the world is gonna have less people! But the amount of population decline needed to give everyone American-style suburbs that are small enough to not have horrible commutes is....a lot. If you go to Europe, you can see ~5 story density is not loud, not smelly, and not dangerous though. It's also not dangerous in America either (but loudness and smells are problems because we're dumb as shit about these things). So I dunno, you do you, but I in the city don't wanna subsidize your coddling in the myriad ways I do today.
    - chickenzzzzu 1y ago
      I would be very interested in hearing how you subsidize my lifestyle, and I will refrain from flippant attacks like "do you pay my mortgage" because it sounds like you are alleging there is some externality that I am producing that you are paying for. Regarding horrible commutes, I for one believe that it is the companies who demand in person work who are the ones who are being coddled here with transport infrastructure. In reality, we need a two speed road network-- one for seriously heavy trucking, and the other for bikes. I have no problem giving up my personal car, if that's the angle you are going to take.
      - 1y ago
- deleted 1y ago
  [deleted]
- VirusNewbie 1y ago
  What if we had some sort of voting system that allowed people to have some say into what they value? You wouldn't give everyone the same amount of voting credit, we'd allocate these voting credits to people depending on how much value we think they provide society. Some might value having a nicer car and smaller house, others might want more land, and then depending on how people 'vote' with those credits.
littlexsparkee 1y ago
https://archive.ph/QqQaf https://archive.ph/QqQaf
JKCalhoun 1y ago
> For decades part of the logic for buying a house was that, after the down payment, mortgage payments were generally cheaper than renting. I thought the logic was that, after say 30 years, you own the home you were making mortgage payments on. My dad explained it to me best. He had bought a single-family house in Homer, Alaska after having moved up there and working in construction for a number of years. He had never owned a home in his life. He got a 30-year fixed loan. He said at the time he was questioning himself as to what he was doing — mortgage payments were something like $400 a month! "Ten years on, you know what the monthly mortgage was?" he asked me. "$400 a month," was his (obvious) answer. He laughed when he said it because at the time that would have been peanuts for rent. He wasn't there for the whole of 30 years but had enough equity in the home some years later that when he did sell it he was able to outright purchase land out East End and build a new home on it. To be sure, times have changed — the market has changed (interest rates have changed of nothing else). But putting money toward ownership still seems like a win.
- Ericson2314 1y ago
  Certainly over mortgage payments is balanced by risk of unexpected repair and upkeep costs. Property capital gains is balanced by the capital gains you could have from investing in other things instead. > My dad explained it to me best. I'm glad you have a found memory of your dad explaining it to you, but this bunch of folk wisdom is killing is killing this country. One has to actually run the numbers to see how all the things net out. I would start with https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2024/upshot/buy-rent-cal...
  - JKCalhoun 1y ago
    Calling them fond memories is not a way I would have characterized them. Regardless, the same strategy regarding home ownership worked for me. Of course to your point there's no telling if I had been renting and putting every extra dollar into the stock market if I might not have come out ahead. But realistically how many people "invest" in that manner with their income? I can tell you my blue-collar background had not raised me to be investment savvy. (I would have no idea what capital gains were until I was probably in my forties.) I suspect that for most people with similar upbringing an investment in their home is their only significant investment in their lifetime — or it was once that way. (Who knew they were killing this country.) I guess that one's out the window now as well then if they can't even afford that. Unexpected repair and upkeep cost — you're suggesting the landlords just eat that? (In my case I have learned to do repairs myself. That has been very liberating, FWIW.) If I am following, your alternative is that we all become renters for life — using any extra money we have to invest in the stock market?
tracker1 1y ago
I'd really like to see individual states put limits on foreign ownership as well as the number of rental 1-4 family units a company (including subsidiaries) one can own.
guywithahat 1y ago
I think there are just some kinds of housing where ownership doesn't make sense; any sort of shared building requires an HOA fee, and the mortgage for a 1-bed in a shared building could easily have an HOA fee that's half the cost. What's more is the most up-to-date data says housing is becoming more affordable, at least in cities with a high percent of illegal immigration. This is a story about millionaires who now have to temporarily rent after their million dollar home burned down and they wait for the market to adjust. It's sad, but not reflective of the average person or their experience
motbus3 1y ago
It is a mistake to think this is not by design. The lack of proper taxing for big companies owning land and houses for renting is ridiculously low and completely put on tenants. These taxes should be exponential and force a cap to where such businesses can make money. Own nothing structure is the worst possible future. You become a slave of work and your life is completely unstable as little fluctuations are passed down to people. This is already happening with all little services that we pay for and there is absolute no reason to not think it will happen to everything.
TheAmazingRace 1y ago
In my very recent experience... I don't think this statement holds as much water as it did a year ago or even six months ago. Right now, in the Phoenix metro area, I'm seeing properties sit on the market for over 100+ days, complete with price cuts, before closing now. Sellers are also far more willing to factor in concessions to help a sale close. It's for this reason that I'm now considering a purchase for the first time in years. I missed the boat after the pandemic… so I decided to wait. I think my patience is paying off.
- 2OEH8eoCRo0 1y ago
  And in my experience a bunch of my neighbors are selling their homes for massively more than they bought them for a few years ago. One sold so fast I couldn't even go view it. I'm in Rhode Island
  - TheAmazingRace 1y ago
    I think this goes to show how hyper local real estate really is.
dismalaf 1y ago
I envy Americans. Your average house price is 5x the average income and you all are becoming aware of it and complaining about it. In Canada, that ratio is 12x and we're taking it while convincing ourselves it's normal...
- BobaFloutist 1y ago
  On the other hand, Vancouver is doing a phenomenal job building up compared to San Francisco. So there's plenty to be jealous about on both sides of the equation.
nunez 1y ago
We were lucky enough to buy this year, and I love the house we bought and the location it resides in, but honestly, I enjoyed being a renter, and I wish the stigma around renting would go away. Until then, affordability will continue to suffer as long as housing is treated as an appreciating asset. They are diametrically opposing goals. To wit, Americans have been stretching their finances to get into their first homes for a long time (think 401(k) loans and ARMs of the past).

Ericson2314 1y ago

[flagged]

DaveZale 1y ago
But don't condos tend to involve HOAs, which are often overpriced and corrupt? I swore off renting and HOAs many years ago. But for city life, there's not much of a choice, absoulutely.
- Ericson2314 1y ago
  Many HOAs do suck, but density unfortunately does require greater coordination amount residents. Either the residents do it themselves, or the landlord does it. Single stair allowing narrower buildings side by side ameliorates them problem though, in that the units of coordination are much smaller.
  - more_corn 1y ago
    Having a hoa fee also changes your mortgage math.
  - gizmo686 1y ago
    Or the local government does it. Which is one of the reasons HOAs took of. Local governments realized that they could avoid work if they required developers to created HOAs to take care of that pesky local governance.
- gizmo686 1y ago
  It is far more common for HOAs to be under priced and neglected. They are run by elected volunteers (from member homeowners); and approximately no one wants to volunteer. What everyone does want is lower dues. When combined with the minimal effort that goes into running most HOAs, this tends to cause them to reduce dues by neglecting maintenance and emergency reserves. Then, when the bill comes due, they need to issue a large special assessment to cover the cost.
chickenzzzzu 1y ago
Sorry, dense housing is loud, smelly, and dangerous. You can't force me to live in a prison like that. The world simply needs less people. Trying to cram more people into less space is inhumane.
- more_corn 1y ago
  There are plenty of open spaces outside of cities.
- heathrow83829 1y ago
  This! i don't see how people think it's acceptable to cram people together like livestock when they object to the same conditions happening to chicken livestock.
- Ericson2314 1y ago
  Get excited, the world is gonna have less people! But the amount of population decline needed to give everyone American-style suburbs that are small enough to not have horrible commutes is....a lot. If you go to Europe, you can see ~5 story density is not loud, not smelly, and not dangerous though. It's also not dangerous in America either (but loudness and smells are problems because we're dumb as shit about these things). So I dunno, you do you, but I in the city don't wanna subsidize your coddling in the myriad ways I do today.
  - chickenzzzzu 1y ago
    I would be very interested in hearing how you subsidize my lifestyle, and I will refrain from flippant attacks like "do you pay my mortgage" because it sounds like you are alleging there is some externality that I am producing that you are paying for. Regarding horrible commutes, I for one believe that it is the companies who demand in person work who are the ones who are being coddled here with transport infrastructure. In reality, we need a two speed road network-- one for seriously heavy trucking, and the other for bikes. I have no problem giving up my personal car, if that's the angle you are going to take.
    - 1y ago
deleted 1y ago
[deleted]
VirusNewbie 1y ago
What if we had some sort of voting system that allowed people to have some say into what they value? You wouldn't give everyone the same amount of voting credit, we'd allocate these voting credits to people depending on how much value we think they provide society. Some might value having a nicer car and smaller house, others might want more land, and then depending on how people 'vote' with those credits.

littlexsparkee 1y ago

https://archive.ph/QqQaf https://archive.ph/QqQaf

JKCalhoun 1y ago

> For decades part of the logic for buying a house was that, after the down payment, mortgage payments were generally cheaper than renting. I thought the logic was that, after say 30 years, you own the home you were making mortgage payments on. My dad explained it to me best. He had bought a single-family house in Homer, Alaska after having moved up there and working in construction for a number of years. He had never owned a home in his life. He got a 30-year fixed loan. He said at the time he was questioning himself as to what he was doing — mortgage payments were something like $400 a month! "Ten years on, you know what the monthly mortgage was?" he asked me. "$400 a month," was his (obvious) answer. He laughed when he said it because at the time that would have been peanuts for rent. He wasn't there for the whole of 30 years but had enough equity in the home some years later that when he did sell it he was able to outright purchase land out East End and build a new home on it. To be sure, times have changed — the market has changed (interest rates have changed of nothing else). But putting money toward ownership still seems like a win.

Ericson2314 1y ago
Certainly over mortgage payments is balanced by risk of unexpected repair and upkeep costs. Property capital gains is balanced by the capital gains you could have from investing in other things instead. > My dad explained it to me best. I'm glad you have a found memory of your dad explaining it to you, but this bunch of folk wisdom is killing is killing this country. One has to actually run the numbers to see how all the things net out. I would start with https://www.nytimes.com/interactive/2024/upshot/buy-rent-calculator.html https://www.nytimes.com/interactive/2024/upshot/buy-rent-cal...
- JKCalhoun 1y ago
  Calling them fond memories is not a way I would have characterized them. Regardless, the same strategy regarding home ownership worked for me. Of course to your point there's no telling if I had been renting and putting every extra dollar into the stock market if I might not have come out ahead. But realistically how many people "invest" in that manner with their income? I can tell you my blue-collar background had not raised me to be investment savvy. (I would have no idea what capital gains were until I was probably in my forties.) I suspect that for most people with similar upbringing an investment in their home is their only significant investment in their lifetime — or it was once that way. (Who knew they were killing this country.) I guess that one's out the window now as well then if they can't even afford that. Unexpected repair and upkeep cost — you're suggesting the landlords just eat that? (In my case I have learned to do repairs myself. That has been very liberating, FWIW.) If I am following, your alternative is that we all become renters for life — using any extra money we have to invest in the stock market?

tracker1 1y ago

I'd really like to see individual states put limits on foreign ownership as well as the number of rental 1-4 family units a company (including subsidiaries) one can own.

guywithahat 1y ago

I think there are just some kinds of housing where ownership doesn't make sense; any sort of shared building requires an HOA fee, and the mortgage for a 1-bed in a shared building could easily have an HOA fee that's half the cost. What's more is the most up-to-date data says housing is becoming more affordable, at least in cities with a high percent of illegal immigration. This is a story about millionaires who now have to temporarily rent after their million dollar home burned down and they wait for the market to adjust. It's sad, but not reflective of the average person or their experience

motbus3 1y ago

It is a mistake to think this is not by design. The lack of proper taxing for big companies owning land and houses for renting is ridiculously low and completely put on tenants. These taxes should be exponential and force a cap to where such businesses can make money. Own nothing structure is the worst possible future. You become a slave of work and your life is completely unstable as little fluctuations are passed down to people. This is already happening with all little services that we pay for and there is absolute no reason to not think it will happen to everything.

TheAmazingRace 1y ago

In my very recent experience... I don't think this statement holds as much water as it did a year ago or even six months ago. Right now, in the Phoenix metro area, I'm seeing properties sit on the market for over 100+ days, complete with price cuts, before closing now. Sellers are also far more willing to factor in concessions to help a sale close. It's for this reason that I'm now considering a purchase for the first time in years. I missed the boat after the pandemic… so I decided to wait. I think my patience is paying off.

2OEH8eoCRo0 1y ago
And in my experience a bunch of my neighbors are selling their homes for massively more than they bought them for a few years ago. One sold so fast I couldn't even go view it. I'm in Rhode Island
- TheAmazingRace 1y ago
  I think this goes to show how hyper local real estate really is.

dismalaf 1y ago

I envy Americans. Your average house price is 5x the average income and you all are becoming aware of it and complaining about it. In Canada, that ratio is 12x and we're taking it while convincing ourselves it's normal...

BobaFloutist 1y ago
On the other hand, Vancouver is doing a phenomenal job building up compared to San Francisco. So there's plenty to be jealous about on both sides of the equation.

nunez 1y ago

We were lucky enough to buy this year, and I love the house we bought and the location it resides in, but honestly, I enjoyed being a renter, and I wish the stigma around renting would go away. Until then, affordability will continue to suffer as long as housing is treated as an appreciating asset. They are diametrically opposing goals. To wit, Americans have been stretching their finances to get into their first homes for a long time (think 401(k) loans and ARMs of the past).