Re: Re: Re: Re: Re: Re: Mortgage question Do you know why housing prices have risen? Any clue? Of course you don't. You see higher prices and think it's good. You don't bother to think of the underlying debt problems, and the fact that Americans are trading their homes for debt, and that it's happening at a faster pace than any time in our country's history. The rise in housing prices is 100% due to debt. You think that's a good thing? Especially at a tiem when jobs are being lost and incomes are dropping? Do you realize that housing prices have outpaced personal income by a wide margin for years? Do you realize that the average American is now spending 50% of their income on housing costs? Can you find any other time in the country's history where that's happened? Do you have any idea what's going on at Freddie Mac and Fannie Mae? Also, it's not a "story." In case you haven't noticed, the economy is doing horrible. It's not going to get better until it gets worse. You can call it doom and gloom, or you can call it reality. Either way, it's the truth. Take out a calculator and figure out how much you pay in interest over 10 years on a $200,000 house at 6%. Add in taxes, insurance and repairs. Then, tell me how much you make if your house doubles in value. Hint: It's zero. Putting your head in the sand and hoping you're right doesn't make it happen.
Re: Re: Re: Re: Re: Re: Mortgage question I'll add my .02. I started dating this wonderful woman on September 26, 1998. She moved into my apartment in November 1998. I proposed on Feburary 14, 1999. We married on September 25, 1999. We had a son on Jan. 30, 2001. We bought our first house in October 2002. Talk about fast track. Marriage is good and everything is falling into place. So as far as a marriage, follow your heart. As far as buying a home with a girlfriend, well, you won't be the first nor the last to do it. But I wouldn't be so defensive as to what some of the other posters are saying here. They make great sense. Read the post again with an open mind. With the money you're making I would say stay in an apartment, pay off more of your debt, save more money and why not pop the question? Whatever you decide, good luck.
Re: Re: Re: Re: Re: Re: Mortgage qu Current housing prices are supported by the low mortgage rates. It's been explained dozens of times across all the financial shows, boards, magazines. Income hasn't been increasing significantly in the past few years. So think about it like this: if you have steady incomes and dropping interest rates, you can support a bigger mortgage while paying the same monthly payment. Here's the kicker: if you have steady incomes and increasing mortgage rates, are ya still gonna have the same buying power as before? I doubt it. You'll be stretching yourself thinner and thinner. And mortgage rates will not be getting significantly lower, most people have accepted that fact already. Also, foreclosure rates are at an all-time high. Not a good sign... Could it be too many people are getting mortgages? Also, building equity? In your first year, if you pay points on your mortgage, that's money straight to the bank. Your first year is mostly interest, you'll build what, maybe $2500 in equity? But you're out close to $15k in interest and points! Basically, it's not so simple as "buy right now to stop paying rent"! Go to a buy v. rent calculator and look at the numbers. For example, if you're not planning on staying in the area for a few years, renting may be a better option.
Re: Re: Re: Re: Re: Re: Re: Mortgage question http://graphics7.nytimes.com/images/2003/07/11/realestate/13cov_chart.jpg Numbers and math doesn't lie. Lower interest rates equal lower payments for housing. The price may be more than in the past, but your total cost including interest will be less at today's lower interest rates.
Re: Re: Re: Re: Re: Re: Re: Mortgage question My advice to the happy couple is don't buy anything until you are engaged and have a wedding date set. Anything until then is wishful thinking.
Re: Re: Re: Re: Re: Re: Re: Mortgag I can only speak for my market but here's what the numbers look like. Two years ago, new construction townhouses sold for $200k. Interest rates were, what, 7%? Even at 8%, monthly payment is $1400 or so. Today, new construction townhomes in the same development, same config, sell for $325k. At 5.5%, that's still $1800 monthly. The townhomes built 2 years ago are selling for $300 now too. So even at that price, it's around $1700. Numbers from here: http://www.mortgage-calc.com/cgi-bi...00&imn=8.0&imx=5.5&yrs=30&out=HTML+3.0+Tables Another way to look at that chart: Townhome at $293k and 6.438% is near same monthly payment as $325k and 5.5%, around $1840, around a 10% drop. If we assume rates will be going back up in the next few years and income levels increase at the same dismal amount of the past 2 years, housing prices will have to drop.
Re: Re: Re: Re: Re: Re: Re: Mortgag Any drop in housing prices will most likely be regional and affect different segments differently. You can still get a 1br apartment in NYC for $110k-$150k depending on building and neighborhood.
