I knew mortgage rates made a huge difference in payments.....but.....

[tvguy]

Helping my daughter with her taxes.

Her loan is $225,000, 30 years fixed. Payment is $905 a month.

My first mortgage, $95,000, 30 years fixed. Payment was $1,125 a month. Year was 1983. Mortgage rates had just PLUNGED from nearly 16%.

Her interest rate, 2.65%. My interest rate was 12.25%.

And the rental market here is nuts. Going rent for her home is $2,000 a month. I don't know how people can afford to rent anymore.

Of course, my wife and I are the first generation in both our families to have a mortgage. Our parents paid cash for their first homes, back in the day when you could still buy a house for less than a year's take home pay. $2,500 in my parents case in 1950. Their take home pay that year with both working was $7,000.

 

[tink89]

Helping my daughter with her taxes.

Her loan is $225,000, 30 years fixed. Payment is $905 a month.

My first mortgage, $95,000, 30 years fixed. Payment was $1,125 a month. Year was 1983. Mortgage rates had just PLUNGED from nearly 16%.

Her interest rate, 2.65%. My interest rate was 12.25%.

And the rental market here is nuts. Going rent for her home is $2,000 a month. I don't know how people can afford to rent anymore.

$2000 for a home. That sounds great!! For $2000 you get a studio in my area.

 

[HeatherC]

Housing market in general is insane. Here in MA a starter home can run 400k. Feel bad for young couples starting out.
I also think rents and housing costs depend a lot on location. Both coasts are prohibitively expensive while the Midwest can still be considered a little more affordable.

 

[tvguy]

Housing market in general is insane. Here in MA a starter home can run 400k. Feel bad for young couples starting out.
I also think rents and housing costs depend a lot on location. Both coasts are prohibitively expensive while the Midwest can still be considered a little more affordable.

My daughter was at the VERY bottom of the housing market here with a $250,000 purchase. Well, should COULD have purchased a condo for about $200,000 but the HOA fees were hundreds of dollars a month, so the more expense house (half a duplex actually) is cheaper per month.
Yes, location, location, location as they say. Watching the show Home Town you see that you can buy a livable (but outdated) home for $40,000 still in the U.S. But only if you want to live in places like Laurel, Mississippi.

 

[tvguy]

$2000 for a home. That sounds great!! For $2000 you get a studio in my area.

I know. A friend worked for the network in NYC and transferred to Los Angeles. Not that LA is an inexpensive place to live, but she says her house payment, and two car payments are less combined than she paid for a large studio apartment in NYC.

 

[tink89]

I know. A friend worked for the network in NYC and transferred to Los Angeles. Not that LA is an inexpensive place to live, but she says her house payment, and two car payments are less combined than she paid for a large studio apartment in NYC.

I live in the bay area and when I hear of home prices and rental prices I get a little jealous. The amount of things I could do with the savings!!

 

[tvguy]

I live in the bay area and when I hear of home prices and rental prices I get a little jealous. The amount of things I could do with the savings!!

And all you bay area folks who are now apparently permanently working from home are moving here and snapping up our inflated value homes as bargains. My neighbor's daughter and son in law have been house shopping for six months. Son in law is from Ireland and he just can't accept that he can't "think about it" for a couple of weeks, because that how things are in Ireland. They decided to make offers on 12 houses only to discover they were the fifth or sixth backup offer behind offers that were made weeks earlier.

 

[tink89]

And all you bay area folks who are now apparently permanently working from home are moving here and snapping up our inflated value homes as bargains. My neighbor's daughter and son in law have been house shopping for six months. Son in law is from Ireland and he just can't accept that he can't "think about it" for a couple of weeks, because that how things are in Ireland. They decided to make offers on 12 houses only to discover they were the fifth or sixth backup offer behind offers that were made weeks earlier.

Well its not me. Bay area is expensive, but its where I was born and raised so not leaving. At least not yet. I don't know many people who have been told to permanently work from home. Most where working from home but they have slowly gone back in to the office even it its just a day or two.

And hey that is just the way things go. Many bay area natives have also not been able to purchase a home because Facebook moved in to our backyard.

 

[lsutigers03]

I bought my first house 12 years ago when a 5% interest rate was great. My loan was $142,000 and my payment was around your daughter's payment.

 

[tvguy]

Well its not me. Bay area is expensive, but its where I was born and raised so not leaving. At least not yet. I don't know many people who have been told to permanently work from home. Most where working from home but they have slowly gone back in to the office even it its just a day or two.

And hey that is just the way things go. Many bay area natives have also not been able to purchase a home because Facebook moved in to our backyard.

I hear tech firms in the Silicon Valley are the biggest group shutting down brick and mortar offices, handing workers a $2,000 laptops, and going all remote. And apparently a year into work at home, they have noticed a measurable increase in productivity because of it.
Our corporate policy is that no additional people will be allowed back in the building before March 29th. But policy also is we will have three weeks notice before being asked to return to the building. and that hasn't happened yet so clearly the March 29th return can't happen. I did get called in to work from the building for three weeks, the week before the election, election week and the week after, only to get hastily kicked out again with 24 hours notice. They had collected and reassigned all our laptops and support equipment, so IT had to scramble to find and assign us new equipment.
To be honest, our local managers are struggling with how to place us safely back in the building. We have about 30 out of about 120 employees in the building and with the required social distancing there is no place left to put more people in the building. We literally had about a 2 1/2 foot work space, so now there are three empty work spaces between every worker so we have lost about 60% of our capacity.

 

[pigletto]

I’m Canadian and live in a small town . Our home would be listed today for 30 percent more than we paid exactly two years ago. The local paper ran a story about a family that just listed and received $135k over asking on their very average home. Real estate has gone NUTS. We are about 1.5 hours from Toronto and until now had not seen the craziness but it’s here now.
I have no idea how the next generation will afford a home when a basic starter is half a million dollars. When interest rates go up on these homes that people are just squeaking into I think we are going to see a big problem.

 

[Pooh2]

Our first mortgage was 14 percent!

 

[barkley]

I hear tech firms in the Silicon Valley are the biggest group shutting down brick and mortar offices, handing workers a $2,000 laptops, and going all remote. And apparently a year into work at home, they have noticed a measurable increase in productivity because of it.

well before the pandemic started we saw western washington tech companies in a bid to get staff offering more and more work from home opportunities. the housing prices/rent on the west side of the state are insane so people were thrilled to be able to work from much lower cost of housing/lower cost of living in general parts of the state. our local housing market has not been able to keep up with demand. we were hard pressed before the pandemic but then when all construction was shut down by the state last winter for months on end it got even worse. add in the cost of lumber doubling over the past year and it's pushing home prices up, up, up.

local rates for a 15 year fixed are 2.25%-great rate but good luck finding any place to buy!

 

[dclpluto]

I never thought I will have a mortgage again. But if these great rates stay when I retire our second home in the villages there will be no need to pay it off. We can easily pay cash for it but doing so will cost us lots of money.

 

[cvjw]

My 25 year old son and his partner recently purchased a $500,000 home with a 2% interest rate. Their payment of around $2000 per month is about the same price as the rent on my son‘s 600 square foot apartment on Piedmont park in midtown Atlanta. Crazy!

 

[supersnoop]

Housing market in general is insane. Here in MA a starter home can run 400k. Feel bad for young couples starting out.
I also think rents and housing costs depend a lot on location. Both coasts are prohibitively expensive while the Midwest can still be considered a little more affordable.

In the Austin suburbs, homes are selling the day they're listed with multiple offers up to 40% over asking price. It's CRAZY!

 

[amcnj]

The low rates are helping to drive prices up
too. Borrowers can qualify for bigger loans and thus can bid more for houses.

 

[mjkacmom]

Housing market in general is insane. Here in MA a starter home can run 400k. Feel bad for young couples starting out.
I also think rents and housing costs depend a lot on location. Both coasts are prohibitively expensive while the Midwest can still be considered a little more affordable.

My SIL lives outside indianapolis, it’s practically free.

 

[Donaldswife]

My SIL lives outside indianapolis, it’s practically free.

Not true, I live in a suburb of Indianapolis and our home prices have skyrocketed in the last year. I bought my nice, average 3 bed/2bed ranch with a basement for $269,000 5 years ago. The house across the street from us just went on the market, only about 30 square feet larger than ours with a 3 car garage instead of our 2 car, and a similar yard. They listed it for $380,000 on Friday, by Monday it was sold at $425,000. We had cars lined up and down our dead end street all weekend looking at the house. They bought the house in 2009 for $255,000. So the skyrocketing prices have hit here too!!

 

[RamblingMad]

Low rates push up asset prices. High rates have the opposite effect.