All Encompassing Mortgage and Real Estate Thread

[Wulaw Horn 19,580]

1 minute ago, Pato del Muerto said:

Friend of ours in Wyoming told us 2 years ago it was 200/sf to build there. Materials cost is probably higher there but also that was 2 years ago. 
 

so yeah how much meat is left on the bone after you run utilities to that acre, split it into 5 lots, and build 6 homes on it?  

It’s not one acre though but 10, right? 

[Pato del Muerto 53,456]

Just now, Wulaw Horn said:

It’s not one acre though but 10, right? 

Yeah but the premise was the approximate cost per acre and is what you can do with one acre. 

[Wulaw Horn 19,580]

1 minute ago, Pato del Muerto said:

Yeah but the premise was the approximate cost per acre and is what you can do with one acre. 

I mean everything you pointed out is true for sure as it pertains to 1 acre. I’d probably be way more willing to pay a million for 10 than I would 100 for 1 because of it. 

[milkman 428]

I'm getting ready to list my house in the next few weeks. In talking with two realtors their opinion on asking price is wildly different. They are around 50-75K different on pricing.
I'm thinking with the current market when a buyer walks in the house that I want them to think that my asking price is reasonable and not overpriced. Pricing the house 25-30K high just seems like a way for a potential buyer to keep looking?

[CooterBrown 18,287]

I'm getting ready to list my house in the next few weeks. In talking with two realtors their opinion on asking price is wildly different. They are around 50-75K different on pricing.
I'm thinking with the current market when a buyer walks in the house that I want them to think that my asking price is reasonable and not overpriced. Pricing the house 25-30K high just seems like a way for a potential buyer to keep looking?

List for over what a realtor tells you. They don’t want to maximize your profit, they want to minimize their effort.

In this market you don’t have to give a shit about what buyers want. You’ll
Get plenty of offers even if you ask the buyer to throw in some hookers and blow as part of their offer.

[closetohumping 17,804]

18 hours ago, CooterBrown said:

List for over what a realtor tells you. They don’t want to maximize your profit, they want to minimize their effort.

In this market you don’t have to give a shit about what buyers want. You’ll
Get plenty of offers even if you ask the buyer to throw in some hookers and blow as part of their offer.

Good and bad in all industries but yes a lot of realtors just want to close quick and move on to the next one.  An extra 1 or 2k of commission is pretty meaningless to them.

 

One pricing strategy though is to price low and let the bidding begin.  SoCal is still hot but if a property is priced too high it will sit, even here.

[UTPhil2006 3,930]

Started off slow but 10 year following the market now.. down .05 so far today.  This coming off 3 year highs from last week 

[Wulaw Horn 19,580]

So, same drill as every time, this is not the interest rate that I would give you (ours are often times lower especially for surly top 1% types) this is not a commitment to lend blah blah blah- this is merely the average of Friday's loans that were locked through loan sifter.  
It's brutal out there, continuously.  

 

30-YR. CONFORMING

5.593% +0.049

30-YR. JUMBO

5.087% +0.046

30-YR. FHA

5.429% +0.026

30-YR. VA

5.238% +0.049

30-YR. USDA

5.321% +0.001

15-YR. CONFORMING

4.621% +0.032

 

[Neonmoon 38,130]

1 hour ago, closetohumping said:

An extra 1 or 2k of commission is pretty meaningless to them.

This makes me ragey

[Esque 135]

@Wulaw Horn

What do you watch in a market like today's to see where loans are going?  Obviously watching the MBS market, but any specific trades or what not?  Super curious if rates pop further after a day or two more like today and get up to 6.00% soon.

[UTPhil2006 3,930]

11 minutes ago, Esque said:

@Wulaw Horn

What do you watch in a market like today's to see where loans are going?  Obviously watching the MBS market, but any specific trades or what not?  Super curious if rates pop further after a day or two more like today and get up to 6.00% soon.

I'd say it's more likely than not they do get to 6%.  The real key will be how long/if they stay there.

[Wulaw Horn 19,580]

43 minutes ago, Esque said:

@Wulaw Horn

What do you watch in a market like today's to see where loans are going?  Obviously watching the MBS market, but any specific trades or what not?  Super curious if rates pop further after a day or two more like today and get up to 6.00% soon.

So my MBS site is down this morning (first time ever) so I have no idea what's going on in that market today- but it must be good b/c I've gotten a dozen emails today with lenders re-pricing for the better.  

I will just give a general primer for everyone here on different effects of interest rates:

MBS (mortgage backed securities) Up- Always good for rates.  Down-  Always bad for rates.  This is the market for home interest rates.  I pay lots of money every year to get this information real time- get text alerts on big moves- so we can lock ahead of re-prices (we usually get about 15 or 30 minutes depending upon how on it the lender is) and get, what I think is the best analysis, in the market place.  Also- technical tools.  This is usually what I share here.

If you don't want to pay for that/watch that (and who would if you aren't in the business it's super niche)

10 year treasury is widely available, widely quoted, and has an after hours market world wide.  Generally- when the 10 year is up that means rates are heading up and when the 10 year is down that typically means mortgage rates are going to fall.  If MBS is a 100% correlation call this a 95 or 90% correlation.  Typically, when people are buying MBS bonds they are also buying 10 year bonds so those kind of work in tandem.  Whenever bonds are being purchased- regardless of how it's quoted- that's good for interest rates

Stock market down- generally means good day for bond market (people have to do something with their money) so call it a 65% correlation (when you hear down down 1000 points figure that interest rates are going to get better- not always the case but usually).

This next one is counter intuitive to people- when "the Fed raises interest rates" that is typically good for your mortgage interest rate (unless you are on a heloc or some other product tied to the fed).  Usually interest rates for houses fall during times of bad news financially.  A bad jobs report, terrorist attack, pandemic, recession, etc mean less money is invested in expansion and triggers a flight to quality.  Bonds are typically considered quality.  People buying bonds presses down interest rates.  Fed rate hike means less demand in the near future, slowing economy, good for bonds. 

Now- the wild card in here is monetary policy- the fed has been expansionary and bought MBS- making interest rates go down.  They have since said they are going to start selling them and people are worried that there won't be enough takers to buy them- so this has pushed interest rates up very high this year.  That- and their continued insistence to duck the inflation problem for as long as possible and do as little as possible about it.  

So- that's the major economic news you might here on the radio or TV or see on the news and how it typically affects interest rates- from most immediate/highest correlation to general direction the arrow points in a market. 

 

TL/DR- Pay most attention to MBS, next most attention to 10 year treasury, good day for stock market typically make interest rates worse- bad days for the stock market typically make them better and when the world seems like it's burning (non inflation wise) that's when you typically see your mortgage guy smiling. 

Edited May 9, 2022 by Wulaw Horn

[Wulaw Horn 19,580]

Part 2 is a companion post to- what do I do about all that information I just got- is now a good time to buy a house?

Here is the thing on interest rates- they aren't driving the bus on the real estate market right now, and the people on the news you hear banging the table the loudest about this are wrong, imo.  Why?  Supply, Supply, Supply.

There are currently less than 1,000,000 houses on the market and I think supply is under a couple months.  Average house is on market less than 3 weeks before there is an offer on it.  The conditions are nuts (but softening some on borrowers).  This is compared to 2009 (I believe) when we had 3,000,000 plus homes for sale then.  Further compounding the problem- there are now something like 14,000,000 more household formations than there were since then.  Millenials coming of age probably the biggest driver, birth rates outpacing death rates, immigration, etc.  Also- the rental market is very strong and up significantly which is also not going to help prices go down. Appreciation has been so hot- running something like 20% nationwide- that it cannot continue- but look for appreciation around 5% nationwide in the coming year with probably greater rates in hot markets throughout the sunbelt.  

Interest rates are headwinds for appreciation, but just not enough to cancel that out- and I've argued before the rates going up will probably decrease supply on market as well- we've seen it here with people talking about not wanting to sell and pointing to their rates in the 2's on a 30 year fixed as a good reason why not to (and it is a good reason!) which will exert further pressure and cause pricing increase.  

Here's the argument for buying now with higher rates:  It doesn't really matter what your rate is in the longterm b/c you aren't locked into it forever, it merely matters what you pay b/c if you are going to pay significantly more tomorrow than today then you buy today and refinance tomorrow.  

Basically- if the house is appreciating you will always be stuck with a worse entry point at some time down the road, while if interest rates get better you can always have a chance to get that back/re-do it through a refinance and save money.  Rates are higher now than they've been since going back to the beginning of the great recession.  It's more likely than not that they will be lower at some point in time in the future.  You don't have to be right all the time on this play- you just have to be right once to pull the trigger, whereas if housing goes up you could end up stuck and never able to get back to where you were when you passed up the opportunity.  Get an ARM (if you are well qualified- not if you need to do that to afford the house) with a reasonable term if you can get a break of near a point, and monitor during that term to find the entry point were you can lock it in and make it fixed.  People buying arms when rates were at historic lows were dumb- you aren't getting that opportunity back.  People buying arms when the market is at a topping point are smart- you get a break and a lower rate and you will be able to get fixed at a point in the future when the market turns in your favor.

Now- you don't know exactly when you are at a topping point in the market- but pay attention to your time frame- both for you and how long you think you are going to own the house, as well as for how long the term is fixed for.  That's how long you have outs for things to go back in your favor.  Also- consider that now is not necessarily the time to worry the most about what your rate is but rather "how much does it cost". If you aren't going to be in your loan forever consider taking a higher rate and getting closing costs covered.  You will be very happy you did if you can get a break even around 50 or 60 months and then find yourself in the loan for 9 months (I think lots of people who bought this summer will be refinancing next winter/spring) you will have made a bunch of money.

 

TL/DR- buy now instead of later if you think prices are going up- don't worry about interest rates b/c you can refinance in the future- arms are good near an interest rate market top and bad at a bottom- pay attention to your time horizon for both the home and the loan. 

[milkman 428]

Interest rates are headwinds for appreciation, but just not enough to cancel that out- and I've argued before the rates going up will probably decrease supply on market as well- we've seen it here with people talking about not wanting to sell and pointing to their rates in the 2's on a 30 year fixed as a good reason why not to (and it is a good reason!) which will exert further pressure and cause pricing increase.  
Here's the argument for buying now with higher rates:  It doesn't really matter what your rate is in the longterm b/c you aren't locked into it forever, it merely matters what you pay b/c if you are going to pay significantly more tomorrow than today then you buy today and refinance tomorrow.  
Get an ARM (if you are well qualified- not if you need to do that to afford the house) with a reasonable term if you can get a break of near a point, and monitor during that term to find the entry point were you can lock it in and make it fixed.  People buying arms when rates were at historic lows were dumb- you aren't getting that opportunity back.  People buying arms when the market is at a topping point are smart- you get a break and a lower rate and you will be able to get fixed at a point in the future when the market turns in your favor.
 
TL/DR- buy now instead of later if you think prices are going up- don't worry about interest rates b/c you can refinance in the future- arms are good near an interest rate market top and bad at a bottom- pay attention to your time horizon for both the home and the loan. 

I'm in complete agreement on the supply even getting worse with people sticking it out in their current homes and pushing the prices even higher. The housing market it totally supply vs demand driven. And the last number I heard was we are around 3 million short.

Have a question on ARM....I'm finishing up a new construction home in the next 30-60 days. I had a brief discussion with my banker about doing an ARM while waiting on rates to come back down. I know a 5 year ARM is common but is there a 10 year option? Also what sort of amortization would I be looking at?

[mchookem 16,765]

5 hours ago, Wulaw Horn said:

Part 2 is a companion post to- what do I do about all that information I just got- is now a good time to buy a house?

Here is the thing on interest rates- they aren't driving the bus on the real estate market right now, and the people on the news you hear banging the table the loudest about this are wrong, imo.  Why?  Supply, Supply, Supply.

There are currently less than 1,000,000 houses on the market and I think supply is under a couple months.  Average house is on market less than 3 weeks before there is an offer on it.  The conditions are nuts (but softening some on borrowers).  This is compared to 2009 (I believe) when we had 3,000,000 plus homes for sale then.  Further compounding the problem- there are now something like 14,000,000 more household formations than there were since then.  Millenials coming of age probably the biggest driver, birth rates outpacing death rates, immigration, etc.  Also- the rental market is very strong and up significantly which is also not going to help prices go down. Appreciation has been so hot- running something like 20% nationwide- that it cannot continue- but look for appreciation around 5% nationwide in the coming year with probably greater rates in hot markets throughout the sunbelt.  

Interest rates are headwinds for appreciation, but just not enough to cancel that out- and I've argued before the rates going up will probably decrease supply on market as well- we've seen it here with people talking about not wanting to sell and pointing to their rates in the 2's on a 30 year fixed as a good reason why not to (and it is a good reason!) which will exert further pressure and cause pricing increase.  

Here's the argument for buying now with higher rates:  It doesn't really matter what your rate is in the longterm b/c you aren't locked into it forever, it merely matters what you pay b/c if you are going to pay significantly more tomorrow than today then you buy today and refinance tomorrow.  

Basically- if the house is appreciating you will always be stuck with a worse entry point at some time down the road, while if interest rates get better you can always have a chance to get that back/re-do it through a refinance and save money.  Rates are higher now than they've been since going back to the beginning of the great recession.  It's more likely than not that they will be lower at some point in time in the future.  You don't have to be right all the time on this play- you just have to be right once to pull the trigger, whereas if housing goes up you could end up stuck and never able to get back to where you were when you passed up the opportunity.  Get an ARM (if you are well qualified- not if you need to do that to afford the house) with a reasonable term if you can get a break of near a point, and monitor during that term to find the entry point were you can lock it in and make it fixed.  People buying arms when rates were at historic lows were dumb- you aren't getting that opportunity back.  People buying arms when the market is at a topping point are smart- you get a break and a lower rate and you will be able to get fixed at a point in the future when the market turns in your favor.

Now- you don't know exactly when you are at a topping point in the market- but pay attention to your time frame- both for you and how long you think you are going to own the house, as well as for how long the term is fixed for.  That's how long you have outs for things to go back in your favor.  Also- consider that now is not necessarily the time to worry the most about what your rate is but rather "how much does it cost". If you aren't going to be in your loan forever consider taking a higher rate and getting closing costs covered.  You will be very happy you did if you can get a break even around 50 or 60 months and then find yourself in the loan for 9 months (I think lots of people who bought this summer will be refinancing next winter/spring) you will have made a bunch of money.

 

TL/DR- buy now instead of later if you think prices are going up- don't worry about interest rates b/c you can refinance in the future- arms are good near an interest rate market top and bad at a bottom- pay attention to your time horizon for both the home and the loan. 

i have sort of instinctually felt this since we started making our moves, but i've never sold a home and only bought this one from my dad 25 years ago so I don't really know shit about fuck lol

as i was reading your post i kept thinking 'yes! i get that' 😁

all in all still feeling really good... anecdotally things may have cooled slightly (based on just one week lol), but our timeline is completely arbitrary so we can be patient. rates were the biggest worry for our destination loc...but see above 😊

 

Edited May 9, 2022 by mchookem

[Hmbre97 6,337]

I honestly think my trying to buy a house has been as stressful as when I went through my divorce/custody battle (which coincidentally left me broke and sidelined until 2021, just in time for prices to skyrocket back out of my budget). 

Unless there is a major price correction in the next year, looks like I'll be moving from Round Rock/GTown up to Belton. It's the closest place that still has homes in my price range. 

[TKthunder2 5,059]

3 hours ago, Hmbre97 said:

Unless there is a major price correction in the next year, looks like I'll be moving from Round Rock/GTown up to Belton. It's the closest place that still has homes in my price range. 

Bertram, Florence, Jarrell, Salado, Circleville?

[Pato del Muerto 53,456]

9 minutes ago, TKthunder2 said:

Bertram, Florence, Jarrell, Salado, Circleville?

Glad this area came up because my mother just drove up to bell county to house shop and ended up liking a neighborhood in Nolanville. Never heard of it, looked it up, and it’s outside of Harker Heights. 
 

now, I thought harker heights was a less than great place crime wise, but the statistics don’t really seem to bear that out.  Does anyone have first hand experience with that area?

small builder and the homes are high 3s to low 4s there. Same builders have some land in salado but those homesites are 6s. 

[Hmbre97 6,337]

1 hour ago, TKthunder2 said:

Bertram, Florence, Jarrell, Salado, Circleville?

I'm a poor so my budget is $350k. Jarrell has some stuff under that range but then you're paying a 3% tax rate which pushes the payment higher on top of being in a town that is just a bunch of houses behind a truck stop.

Bertram/Liberty Hill is too expensive now (for me). I rarely see anything my price range come up in Florence; mostly houses on acreage. Circleville and Granger always seem to be older homes priced super high and I really don't have the disposable income to be fixing up an older house or dealing with shit breaking down due to age. In Belton, I can get something at or below my price range that was built in the last few years and have a decent tax rate as well.

I just signed a contract a couple weeks ago for a new build in south Belton that the builder says may take up to 12 months. I figure that gives me time to kinda keep watching the market and I can bail with only my earnest money lost if something better comes along in that timeframe. If not, I just buy the new build since I already locked the price of the home.

Edited May 10, 2022 by Hmbre97

[Pato del Muerto 53,456]

2 minutes ago, Hmbre97 said:

just signed a contract a couple weeks ago for a new build in south Belton that the builder says may take up to 12 months. I figure that gives me time to kinda keep watching the market and I can bail with only my earnest money lost if something better comes along in that timeframe. If not, I just buy the new build since I already locked the price of the home.

Name of builder and neighborhood?

[Hmbre97 6,337]

13 minutes ago, Pato del Muerto said:

Name of builder and neighborhood?

PM sent

[TKthunder2 5,059]

1 hour ago, Hmbre97 said:

I'm a poor so my budget is $350k. Jarrell has some stuff under that range but then you're paying a 3% tax rate which pushes the payment higher on top of being in a town that is just a bunch of houses behind a truck stop.

Bertram/Liberty Hill is too expensive now (for me). I rarely see anything my price range come up in Florence; mostly houses on acreage. Circleville and Granger always seem to be older homes priced super high and I really don't have the disposable income to be fixing up an older house or dealing with shit breaking down due to age. In Belton, I can get something at or below my price range that was built in the last few years and have a decent tax rate as well.

I just signed a contract a couple weeks ago for a new build in south Belton that the builder says may take up to 12 months. I figure that gives me time to kinda keep watching the market and I can bail with only my earnest money lost if something better comes along in that timeframe. If not, I just buy the new build since I already locked the price of the home.

I mean, the massive increase in land value, plus material and labor increase has raised what were new homes in the 200s up to the 400s pretty rapidly.  If you’re set on a new home that’s going to be hard to find, still I’m seeing some options closer than Belton in your range.  

https://www.redfin.com/TX/Liberty-Hill/Butler-Farms-Americana-Collection/The-Teton-320/home/178376285

I’m also finding some 1-2 owner type homes in Round Rock/Georgetown that are likely new enough for most people.

Belton is a good area, if you like it then that’s awesome and do your thing, but know there are ways to get closer on your budget, you just have to decide what the trade off is.

[TKthunder2 5,059]

Anybody want to live like a king?

https://www.zillow.com/homedetails/11005-Spicewood-Pkwy-Austin-TX-78750/29374345_zpid/

[fattyflattie 4,640]

4 minutes ago, TKthunder2 said:

Anybody want to live like a king?

https://www.zillow.com/homedetails/11005-Spicewood-Pkwy-Austin-TX-78750/29374345_zpid/

Damn I thought 1.6 got you about 1400ft in Austin these days.  Crazy house. 

[gmr548 16,691]

7 hours ago, TKthunder2 said:

Anybody want to live like a king?

https://www.zillow.com/homedetails/11005-Spicewood-Pkwy-Austin-TX-78750/29374345_zpid/

 

7 hours ago, fattyflattie said:

Damn I thought 1.6 got you about 1400ft in Austin these days.  Crazy house. 

In the midst of this heat wave, the thought of some rich motherfucker buying a house in Texas, one literally built to look like a castle, but still not having a private pool is hysterical to me.

[fattyflattie 4,640]

15 minutes ago, gmr548 said:

 

In the midst of this heat wave, the thought of some rich motherfucker buying a house in Texas, one literally built to look like a castle, but still not having a private pool is hysterical to me.

Lack of moat bringing price down imo. 

[closetohumping 17,804]

9 hours ago, Hmbre97 said:

I'm a poor so my budget is $350k. Jarrell has some stuff under that range but then you're paying a 3% tax rate which pushes the payment higher on top of being in a town that is just a bunch of houses behind a truck stop.

Bertram/Liberty Hill is too expensive now (for me). I rarely see anything my price range come up in Florence; mostly houses on acreage. Circleville and Granger always seem to be older homes priced super high and I really don't have the disposable income to be fixing up an older house or dealing with shit breaking down due to age. In Belton, I can get something at or below my price range that was built in the last few years and have a decent tax rate as well.

I just signed a contract a couple weeks ago for a new build in south Belton that the builder says may take up to 12 months. I figure that gives me time to kinda keep watching the market and I can bail with only my earnest money lost if something better comes along in that timeframe. If not, I just buy the new build since I already locked the price of the home.

Did the contract have a price lock?   Been hearing about builders raising the price at the end

[UTPhil2006 3,930]

Down already 0.11 in the 10 year.  Let's keep it rolling.  

[Hmbre97 6,337]

1 hour ago, closetohumping said:

Did the contract have a price lock?   Been hearing about builders raising the price at the end

Yes, it's price locked. 

[tx 3 putt 78,672]

Just a fyi, @UTPhil2006 has a home and auto insurance person. They just cut me a hell of a deal and improved my coverage. 
 

easy peasy, I’m about to send 3 family members their way. Also looking forward to a free baseball game or two. 
 

thanks again @UTPhil2006 !!!

[milkman 428]

Yes, it's price locked. 

I would almost guarantee there is a escalation of building material clause in the contract. You might want to re-read the contract.

[Sam Lin 3,597]

20 hours ago, gmr548 said:

still not having a private pool is hysterical to me.

After having had a pool in 2 previous houses, I will not consider a house with a pool any more. It's great if you use it frequently. It's just a money and time pain in the ass if not.

[Wulaw Horn 19,580]

And after a plus 100 point start to the week through lunchtime Tuesday we are down 100 points since then. Inflation worse than expected at 8.3 (this should have been a better reading compared to this time last year) and market back to the worst in 14 or so years. Awesome! 
My guys are still saying October before it turns around. If You can get a lock it’s wise to do it sooner rather than later. It will turn around. Looks like that pivot won’t be this week. 

[closetohumping 17,804]

I already asked @Wulaw Horn this but wanted to get a pulse from the other experts.  This is a place where experts hang right?  

 

Is this a "no shit Sherlock" or "it depends" question.  If you can afford the payments, are you better off doing 15 year or a 30 year (overpaying on the thirty year).  Asked a few others and surprisingly, I got "it depends" from a few people.

[Catpfish 618]

On 5/6/2022 at 12:13 PM, T’Boo Ted Marshall said:

We priced our house at the top end of recently sold comps and still getting over ask.  Feels like right now the standard is to offer above ask out of the gate unless it is obscenely priced.  

My personal thinking on this is that if you have the discipline to make the extra payments, go with the 30 year and pay it early.  That way you have a safety net should some emergency arise.  You might be paying a little extra interest due to the higher rate, but it's like a small insurance policy.

[UTPhil2006 3,930]

24 minutes ago, Catpfish said:

My personal thinking on this is that if you have the discipline to make the extra payments, go with the 30 year and pay it early.  That way you have a safety net should some emergency arise.  You might be paying a little extra interest due to the higher rate, but it's like a small insurance policy.

Pretty much this.  Get the 30 but pay it like a 15.  That way you have a safety net just in case things go awry.

[Wulaw Horn 19,580]

Yep. I said if The spread was 3/4 or a point I’d probably recommend the 15 as a good enough payment on the risk premium but any less I’d pass. 

[tokamak 6,687]

33 minutes ago, closetohumping said:

I already asked @Wulaw Horn this but wanted to get a pulse from the other experts.  This is a place where experts hang right?  

 

Is this a "no shit Sherlock" or "it depends" question.  If you can afford the payments, are you better off doing 15 year or a 30 year (overpaying on the thirty year).  Asked a few others and surprisingly, I got "it depends" from a few people.

For me, it's an "it depends" - on your personal financial situation, rates, the loan amount, etc.

The rates from @Wulaw Horn's most recent update 2 days ago were 5.593% on a 30-year and 4.621% on a 15-year. I just ran the numbers, and on a $400k loan, that interest rate difference comes out to $200/mo when paying a 15-year schedule. There's a strong argument for the 30-year loan (in fact, that's what we did on our last house), but $200/mo isn't nothing.

There's actually an option C - get the 30-year, pay it on a 30 year schedule, but save/invest the difference in payments with a 15 year schedule. I'm one of the lucky bastards that's sitting on a 30-year at 2.5% so that's what I'm currently doing. Don't think that makes any sense anymore now that rates have bumped up.

[Wulaw Horn 19,580]

4 minutes ago, tokamak said:

For me, it's an "it depends" - on your personal financial situation, rates, the loan amount, etc.

The rates from @Wulaw Horn's most recent update 2 days ago were 5.593% on a 30-year and 4.621% on a 15-year. I just ran the numbers, and on a $400k loan, that interest rate difference comes out to $200/mo when paying a 15-year schedule. There's a strong argument for the 30-year loan (in fact, that's what we did on our last house), but $200/mo isn't nothing.

There's actually an option C - get the 30-year, pay it on a 30 year schedule, but save/invest the difference in payments with a 15 year schedule. I'm one of the lucky bastards that's sitting on a 30-year at 2.5% so that's what I'm currently doing. Don't think that makes any sense anymore now that rates have bumped up.

Always let your personal situation trump math based decisions. 
I’ve got a borrower that’s a state employee and guaranteed a job for life that’s 50 years old and wants to retire at 65 I’m pushing hard for 15 year. 
I get anyone with a hint of income instability and I don’t go less than 30. 

[crash_davis 23,468]

[Wulaw Horn 19,580]

4 minutes ago, crash_davis said:

Wish it were adjusted for inflation. But yeah- looks like I should move to an outskirt of El Paso! Or anywhere in the middle of no where confederacy.  

[crash_davis 23,468]

Just now, Wulaw Horn said:

Wish it were adjusted for inflation. But yeah- looks like I should move to an outskirt of El Paso! Or anywhere in the middle of no where confederacy.  

this shit is unsustainable. income did not increase 340%. we are at a tipping point. either the market is going to completely tank or there will be a mass revolt by a majority of americans who cannot afford rent or a home. i don't believe the astronomic price increases are isolated to the US.

i'm watching the world self implode.

[closetohumping 17,804]

5 minutes ago, crash_davis said:

this shit is unsustainable. income did not increase 340%. we are at a tipping point. either the market is going to completely tank or there will be a mass revolt by a majority of americans who cannot afford rent or a home. i don't believe the astronomic price increases are isolated to the US.

i'm watching the world self implode.

Yep.  I'm not big on Uncle Sam stepping in but holy shit man

[crash_davis 23,468]

1 minute ago, closetohumping said:

Yep.  I'm not big on Uncle Sam stepping in but holy shit man

It will be interesting to see the results of Canada's new restriction on foreign home buyers, if this actually works.

[closetohumping 17,804]

1 minute ago, crash_davis said:

It will be interesting to see the results of Canada's new restriction on foreign home buyers, if this actually works.

I think that's a small part of the problem.

[jimmyjazz 47,130]

25 minutes ago, crash_davis said:

this shit is unsustainable. income did not increase 340%. we are at a tipping point. either the market is going to completely tank or there will be a mass revolt by a majority of americans who cannot afford rent or a home. i don't believe the astronomic price increases are isolated to the US.

i'm watching the world self implode.

Do you have a link to that graphic, hopefully something where data for an individual county can be selected?

I need to figure out where to move.

[Muny_Tex 315]

this shit is unsustainable. income did not increase 340%. we are at a tipping point. either the market is going to completely tank or there will be a mass revolt by a majority of americans who cannot afford rent or a home. i don't believe the astronomic price increases are isolated to the US.
i'm watching the world self implode.

I agree with the sentiment but disagree with the outcome. I think we underestimate how quickly (especially gen y/zoomers) become accustomed to misery and/or hopelessness…if it’s just implied from birth that everyone in your family/social circle rents their dwelling, then it doesn’t really seem that bad that you don’t own one.

Under this framework, “nice” homes gradually move into the opulence category alongside yachts, fine jewelry, exotic cars etc….there’s no vicious anger in not possessing something that you never reasonably expected to obtain.

You don’t generally hear working class people in super stratified places like Mexico City lamenting their lack of home ownership opportunities…that concept is so far out of the question it doesn’t even register as a gripe; whereas rent/food/fuel increase is a near frequent cause of strain and periodic uprisings.

A lot of the viciousness/resentment in the US js gonna be isolated to the older millennials who generally considered home ownership a rite of passage into adulthood, along with family aspirations etc. up until very recently…when 25+ years worth of $$ appreciation got pulled forward into ~30 months with a bonus nut punch of having to fight off institutional investors.

Tons of upper/middle class ppl in mid-late 30s are suddenly experiencing *way worse* lifestyles and outlooks than they grew up with…and with a bitch-slapping velocity that makes them want to rage since they generally “played by the rules” all these years only for the payoff to be ripped away at the very last moment.

Contrast that with the age 10-15 cohort who for pretty much all their formative years will know nothing besides hysteria, scarcity, and near constant turmoil. Their “normal” is just fundamentally different than those who grew up with seminal moments of American prosperity and national pride.

The bottom line is, the short-term psychological transition is going to be very painful for many, but once the middle class is officially (and permanently) destroyed it won’t “feel” all that badly for those who grow up in the new paradigm.

[Wulaw Horn 19,580]

1 minute ago, Muny_Tex said:

I agree with the sentiment but disagree with the outcome. I think we underestimate how quickly (especially gen y/zoomers) become accustomed to misery and/or hopelessness…if it’s just implied from birth that everyone in your family/social circle rents their dwelling, then it doesn’t really seem that bad that you don’t own one.

Under this framework, “nice” homes gradually move into the opulence category alongside yachts, fine jewelry, exotic cars etc….there’s no vicious anger in not possessing something that you never reasonably expected to obtain.

You don’t generally hear working class people in super stratified places like Mexico City lamenting their lack of home ownership opportunities…that concept is so far out of the question it doesn’t even register as a gripe; whereas rent/food/fuel increase is a near frequent cause of strain and periodic uprisings.

A lot of the viciousness/resentment in the US js gonna be isolated to the older millennials who generally considered home ownership a rite of passage into adulthood, along with family aspirations etc. up until very recently…when 25+ years worth of $$ appreciation got pulled forward into ~30 months with a bonus nut punch of having to fight off institutional investors.

Tons of upper/middle class ppl in mid-late 30s are suddenly experiencing *way worse* lifestyles and outlooks than they grew up with…and with a bitch-slapping velocity that makes them want to rage since they generally “played by the rules” all these years only for the payoff to be ripped away at the very last moment.

Contrast that with the age 10-15 cohort who for pretty much all their formative years will know nothing besides hysteria, scarcity, and near constant turmoil. Their “normal” is just fundamentally different than those who grew up with seminal moments of American prosperity and national pride.

The bottom line is, the short-term psychological transition is going to be very painful for many, but once the middle class is officially (and permanently) destroyed it won’t “feel” all that badly for those who grow up in the new paradigm.

I'm not arguing that you are wrong, but holy shit that's bleak. If it does happen like that you are correct that it will just become "a way of life" to be renter, but I think home ownership is such a foundational core of the American culture (we basically all immigrated here b/c someone in our ancestry really wanted to own land/a home) that it doesn't ever go away.  I hope anyway.  Because America isn't America without a robust culture of home ownership.  

[crash_davis 23,468]

4 minutes ago, jimmyjazz said:

Do you have a link to that graphic, hopefully something where data for an individual county can be selected?

I need to figure out where to move.

there are many results in google. this is the first best example.

https://blogs.imf.org/2021/10/18/housing-prices-continue-to-soar-in-many-countries-around-the-world/

[jimmyjazz 47,130]

Thanks, but I was referring to the US map by county.  I can't find a dynamic version where I can select an individual county to get its data.