Be realistic.... what is the average size of a house of a newer build? 2200-2500 square feet. Granite counter tops, tile baths, so on and so on. That's what I mean by need/want. The discussion with Canell was based on income and average price of a house. And people are pushed to buy very top end of what the can get approved for. That doesn't mean they can actually 'afford' that payment if the car breaks down, a medical expense pops up, a change in employment. I have bought and sold a number of houses myself. I took a hit because a young couple really really wanted the house, so they up bid, and then couldn't get approved for the full amount they bid, and then add in the 'closing costs' game, and we lost around 5 weeks on a good market. When they tried to change their offer to what they could get approved for, it was less then what other interested buyers had offered, but they had bought elsewhere at that point.
Average sqft of a 3 br house is 1300. I know what you are trying to say, but its not as common as you think. 20 years ago people were talking about so many going "house poor" when they buy too much house. Its not a new thing. Human nature has always been the same.
Only if you try to buy in an area you can't afford. And if you can't afford it on one income and raising a family, you can't afford it.
This house in my State sold recently for $6 million (not in America, obviously - you guys have insanely cheap real estate). It's uninhabitable, and has major structural issues.
They'll stop buying when they've bought it all. They want us all Life Renters. PS: I've tried telling renter family and friends about this, but they can't grasp it. They think the mass-purchase of private properties is For The People, because their shilling overlords tell them it is.
Not at all. People are still buying properties in their twenties, in places where property is affordable.
So don't buy or rent a place that takes half your income. There are plenty of places where that won't happen, even on a minimum wage.
So don't wait that year. If you have to, then you adjust the location of your purchase to reflect your wage rise.
No they don't. MANY decide that if they can't live in their dream location (almost always a large coastal city), they won't buy property at all. They become the Life Renters the elite want. Their own sense of entitlement sees them walk straight into the trap.
You mean like the house you posted? Only a moron would pay $6 million for that wreck. But hey, if you brainwash people to believe those prices are OK, why not? If you want to get consolation for why RE prices in your country are so ridiculous, alright, you got it. Just stop buying at those ridiculous prices and may be, just may be they will come down. You're missing the point. The point is, real estate appreciates more compared to income in relative terms. The gap is increasing, in other words.
Where do you get that figure from? Maybe a house built in the 50's, but nothing* that has been built in the last 10 years. *with some exceptions, but not the norm
No, sorry. Its 2300, not 1300. 1300 is pretty small indeed. Builders build what sells. They also build condos for those who cannot afford a house. Either way, the situation is much better now than it was in 2006, when banks would loan money to anyone, and lot of people got burned with the exotic mortgages. Now the requirements are much more strict, and banks share the responsibility of making sure the buyer can make the payments, Have median house size gone up over the years? Yes
It depends on where you live. Real estate is “middle class wealth”. An 1800 sf two story entry level house in northern Sacramento county is low at around $450k. As near as I can figure is around $1600 a month, plus taxes and insurance impounds for ~ $1900 month total. (Excluding utilities - water, sewage, garbage, two cars.) The biggest issue is the down payment. I am in a high growth area and most purchases are funded by inheritances from baby boomer parents, and resale of former homes closer to the Bay Area. That lack of a down payment is why middle class kids are moving*. So the answer is “It depends”. *A married couple in my family both work good jobs to support their apartment. They can’t live on one paycheck so they can’t start a family. I expect them to suddenly figure it out and join the exodus to states with better economic conditions.
My wife is a realtor. Before she will show a property, the buyer must have formal loan approval. In 08, anyone who could fog a mirror got a loan. There are no more sub prime loans so I don't see a crash like in 08. If I am wrong, I will buy another home!
No, like a house in a LOCATION you can afford. In this country the condition and size of the house are irrelevant .. it's always about location. That $6mil 'wreck' is that price because of its location in a large coastal city. We still have places like the following (which would be considered quite grand and fancy by most Australians) selling for $150k: And no I didn't miss the point. That's why I said "so don't wait that year". Housing where I live increases 20% a year. Waiting even six months is foolish, given that.
In this country, newer houses are worth less than older houses. There are some exceptions, but these would only be the high end architect designed new builds. Value increases with age, here. There are three reasons for that .. 1) we prefer the way they look - by far (they're almost always beautifully designed), 2) they're much better build quality and materials, and 3) they're usually in the best locations, since they were built before land was hard to get. Newer houses are generally in the worst locations, built from low quality materials and workmanship, and are almost always horrifically badly designed. That makes them much less desirable in the broader market.
That's rather the opposite of the real estate market in the US. Older homes, all things being equal, would go for less than newer homes.
Eventually, single family dwellings will be owned by investment companies and foreign governments because they are cash buyers in bad times. Banks will trample your nuts to hand a pen a cash buyer. Then they will re finance it through their own subsidiary to pull all the cash back out.
As Mike posted, it's usually the opposite here in the US. There are exceptions, I really like the real Craftsman houses and the detail... which is usually missing from the newer homes, even some of the higher end ones. I peruse the listings on a regular basis for a multitude of reasons, and I'll look at a house well over the 1M mark, and ask myself it may have square footage, but where is the quality? There are still a lot of 'McMansions' being built out there, and referred to as 'toss ups', which is exactly what the builder did. No quality, and virtually every short cut and 'builder quality' finishes. I wouldn't expect some of them to last through a stiff wind.
Well, if it's in the center of the city and you are planning to build a skyscraper on that place, yeah, that might cost $6M. Otherwise it's lunacy! Btw, where is that, Australia I presume? Singapore? Yeah, that is exactly what banksters want you to think! "Buy now because tomorrow it will be more expensive!" And guess what - if people "buy" that "buying mantra" yeah, no ****, prices are going to rise. It's a self-fulfilling prophecy and a demand-supply issue - you create demand -> prices are rising. But I guess there will always be suckers who are ready to pay a lot of money for "nothing" (no free chicks, I am afraid) and be enslaved to a bank whole their life.
Given that you can code from the bottom of the Ocean why should you buy a house in an expensive area?
