Why we don't build starter homes
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Life is rough out there. Not sure I'd have had the patience for it as a younger person. But I sure do recognize that politics must change in the face of these changes in facts. Let old people run our politics and they'll be stuck in the realities they were young within. And those realities were a heck of a lot easier.
@Horace said in Why we don't build starter homes:
Life is rough out there. Not sure I'd have had the patience for it as a younger person. But I sure do recognize that politics must change in the face of these changes in facts. Let old people run our politics and they'll be stuck in the realities they were young within. And those realities were a heck of a lot easier.
People born in the 1950-55 era saw 15-18% mortgages when they were in the starter home market.
People born 20-25 years later came of age in a very low interest rate environment. When I had a mortgage, which was only about 6 years total, it was around 6 or so IIRC
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What young people didn’t have 30-40-50 years ago were $100 per month cell phone bills, $100 per month internet bills, $1000 computers and laptops that need replacing every 3-4-5 years… They were graduating college $10,000 in debt instead of $200,000 in debt.
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@Mik said in Why we don't build starter homes:
That's one part of it. I think another is we have raised young folks' expectations past the point of reasonable. they by and large do not expect to struggle or build - just graduate and voila, instant affluence.
The market is downwind of the facts, and I am fully aware that the market has provided me every opportunity I've taken advantage of. I've never made that much in salary. Call my top at 200k. But in terms of assets, I've had multiple millions for a long time now. I have been employed. If the market falters, then I'll know that even those like me, will not have availed themselves of those opportunities. Because those opportunities did not exist.
@Horace said in Why we don't build starter homes:
@Mik said in Why we don't build starter homes:
That's one part of it. I think another is we have raised young folks' expectations past the point of reasonable. they by and large do not expect to struggle or build - just graduate and voila, instant affluence.
The market is downwind of the facts, and I am fully aware that the market has provided me every opportunity I've taken advantage of. I've never made that much in salary. Call my top at 200k. But in terms of assets, I've had multiple millions for a long time now. I have been employed. If the market falters, then I'll know that even those like me, will not have availed themselves of those opportunities. Because those opportunities did not exist.
You’re probably like me in that your assets exceed the sum total of dollars you’ve earned in your entire life. That’s the miracle of compounding returns and living below your means.
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This is the battle we’re having with Lucas and Hanna right now. Don’t run out and rent a nice apartment at $2K per month now, stay at home for 1 year and use that $24K along with a first time homeowner down payment assistance program to buy a cheap condo. Even if it’s not appreciating, it will still build more equity than rent…
@LuFins-Dad said in Why we don't build starter homes:
This is the battle we’re having with Lucas and Hanna right now. Don’t run out and rent a nice apartment at $2K per month now, stay at home for 1 year and use that $24K along with a first time homeowner down payment assistance program to buy a cheap condo. Even if it’s not appreciating, it will still build more equity than rent…
If it helps your argument, that is exactly what I did. In 2008 I stayed home for 1 year, saved up just enough to put down 5% on a condo at $245k in 2009, sold it in 2020 for $385k which went towards my home purchase in Minnesota. Sure, market timing was a little helpful, but hard to plan around that.
