LOL. Can anyone afford to buy a home?
12 replies (most recent on top)
Most boomers were actually buying homes in the 70's not 80's. That's when interest rates were closer 20% and you could barely even get a mortgage without connections.
This is the best interest rate tracker:
https://www.mortgagenewsdaily.com/mortgage-rates/mnd
We are slightly below 5.5% for a 30 year conventional...
5 year arm is at 4.5%
@ear, first, $80k in the 80's was 4x our salary. Second, that "nice" home likely didn't have a/c, smoke detectors, microwave, dishwasher, attached garage, thermalpane windows, multiple bathrooms etc, etc. In fact, the house my parents bought in 1970 didn't even have heat upstairs and each bedroom had one outlet.
Ok….as a boomer I’ll mention cheaper home prices.
You also got to pay $4,000 for a laptop, $2,000 for a bag phone, $3,000 for mid quality stereo, etc.
My point being every era has its positives and negatives.
What all these boomers forget to mention is the outrageous average home price today vs. in the 1980's. Sure, bE gLaD iTs nOt 11% is an easy argument to make when you could buy a nice house for 80k when that was the going interest rate.
I was ecstatic when my first home mortgage loan interest rate was less than 10%. This rate is still low by historical standards. Rates from 1983-2009 ranged from 5-13.4%.
We have had artificially low rates for about 20 years. A friend of mine bought a house in 1989 and he happy as he-l to get a 9.75 rate and only needed to put 10% down. Time we get back to reality folks.
Tell me you weren't alive in the early 80s without telling me you weren't alive in the early 80s.
That's kind of the point. Stop the demand so the supply can catch up. Pity interest rates on my savings haven't gone up. I just feel like I'm getting screwed out of every dollar so all the big companies can claw back the money they lost during the pandemic. The joys of being in the working class.
When I bought my first house in the late 90s my rate was 7.25% and that was considered low for the times. I had to save for about a year for the down payment and buy something I could afford. It wasn’t a palace.
We have been living in an artificial rate environment for almost 2 decades thanks to government intervention. Between that and the rise of “lifestyle entertainment” people now have completely unrealistic expectations about their money can buy. That is the real danger to the economy because they will borrow to get it and many won’t be able to pay it back.
How come my savings account still pays .001%?
I still see 5%?