Cost Of Living Today versus 30 years ago

[Crankyshank]

Amen. I have had my MIL over my house for the last three days, and I am ready to jump off the nearest causeway. Luckily this is the last day. After dinner tonight, off she goes.

Kudos for you for dealing with her for three days without throwing her off the causeway.. I don't think I could make it that long.

 

[barkley]

one financial concern i have is that so many folks seem to view as their savings "the equity in my house". i no loads of people who have the mind set that they don't have to worry about thier financial futures because they can always sell their home "and have ALL that equity"/"going to sell my house and retire someplace cheaper, cuz i'll have ALL that equity".

while housing values do go up (and tremendously in recent years) there is ultimatly a maximum value the average house will achieve (i know, there are areas that all of a sudden become popular or have an industry boom and the houses go for ridiculos amounts). i look at my neighborhood. it finished construction in 2000 and those of us that bought the last homes paid 192,000.00 (not including upgrades). there has probably been a 40% turnover in houses since then and they are now going for over 600,000.00. i can't imagine with the interest on this type of mortgage how little can be going (with a managable payment) (and this neighborhood is not one with executives or tremendously high paid residents) on the principle. and i can't imagine that the housing market will forever continue to skyrocket. i just envision homeowners that want or need to downsize or move in the future not being able to even cover their original mortgage (and we won't go into how many have 2nds and 3rds for the pools in the back yards, the debt consolidation loans...). i just envision it spiraling out of control and scads of forclosed homes.

 

[mickeyfan2]

See - Another issue is, we have LOTS of space right now. We have the 1st and 2nd floors of the apartment. We've got 2 living rooms, 2 kitchen areas, 4 bedrooms, 2 bathrooms. It's great.

Do you really need two apartments? Maybe reduce to one and save the other half of the rent for your home. Just a thought.

 

[mickeyfan2]

i just envision it spiraling out of control and scads of forclosed homes.

IMHO that time is not as far away we would like.

 

[boomhauer]

Do you really need two apartments? Maybe reduce to one and save the other half of the rent for your home. Just a thought.

Well, we had the 2nd floor and we started to realize we were a bit cramped. Then, the people downstairs moved out and my grandparents-in-law were having a tough time renting the apartment out. So, they offered to let us have both apartments for an extra $400 a month. We figured, no way would we ever have that much room in an apartment or condo for that much money.

To be truthful, we haven't though much about a house for right now for one simple, morbid, reason. When my GIL's pass away, they're leaving the house to my MIL, who in turn has told us if we stay, she won't charge us rent. So, we figured, given they are in their 80's, we would wait a few years, and during the time we were living without a rent payment, we would save all that money and put down a huge down payment on a house.

I know it sounds mean, but what can I say? We were approached, and it sounded like a good idea.

I mean, my MIL drives me batty at times, but I love our cozy home. We have lots of space. It's 5 minutes from my work. I don't have any immediate desire to leave.

 

[dvcgirl]

one financial concern i have is that so many folks seem to view as their savings "the equity in my house". i no loads of people who have the mind set that they don't have to worry about thier financial futures because they can always sell their home "and have ALL that equity"/"going to sell my house and retire someplace cheaper, cuz i'll have ALL that equity".

I've heard that deliquencies and foreclosures are going to increase by 15% between now and 2007. And yes, the "equity" game is only useful if you sell close to retirement and downsize, or rent. I hear lots of talk about the "reverse mortgage", but right now they are just awful deals. The fees associated with them are ridiculous and the payout is low. There will be an awful lot of 70 year old part-time workers in our country beginning soon...and that trend will grow.

 

[brerrabbit]

No doubt housing prices are up considerably from thirty years ago but I truely believe the biggest difference between now and then is lifestyle and expectations of individuals. Here is how I look at it, thirty years ago I was 16 years old and lived at home. My families total expenditure monthly on communication/ information was $16. $10 a month for the phone, no call waiting, no caller id, just an old rotary dial phone. $3 each to the two local newspapers in Houston for monthly subscriptions and that was it. TV was free, no cable, no VCR's, no DVD's just ABC, NBC, CBS and a few UHF channels. The same bill today is $130 a month for all four family members to have cell phones, a home phone with bells and whistles that costs $35 a month, cable and internet bill rolled into one that costs $120 a month average DVD rentals of $20 a month and the next thing you know you have spent $300 on what cost $16 thirty years ago. Thirty years ago our family vacation was a week at the lake in a tent that cost about $100 for the whole week. No days the annual vacation is a week for four at WDW and cost almost $ 3,000. Lets face it a big part of our financial problems today are based on the fact that we all believe we have to have a lot of things we consider as necessities that in reality are luxuries. We bought our first house when we were 23 years old and it cost $78,000 IN 1983. We manged it because we wanted a house. People just need to really consider what things are necessities and what are luxuries and live their lives towards their goals.