Your down payment hypothetical ignores historical first-time buyer patterns.

Jul 25, 2024
7:35:05am

Abe Froman Political Junky

We paid PMI for years. Most first-time home buyers do, because they can’t afford 20% down.

Housing markets cycle. Interest-rates fluctuate. Timing matters. It has always been thus.

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Abe Froman

Previous username: Rise and Shout
Bio page: Abe Froman
Joined: Nov 19, 2006
Last login: Nov 3, 2024
Total posts: 90,220 (8,025 FO)

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Messages

Author

Time

We need more empathy for the current generation

Blueto

Jul 25, 6:47am

Average home price Utah:$551,300. 20% down $110,000.

DubuMfalme

Jul 25, 6:57am

First-time home buyers can’t afford the average home, Dub. It has always been

Abe Froman

Jul 25, 7:01am

My biggest issue is that starter homes used to have a yard. Now it’s a townhome.

Powerbait DPM

Jul 25, 7:07am

Check out these homes for half a million. This is the market now.

DubuMfalme

Jul 25, 7:07am

The same houses in Oklahoma City are less than $100K

donnerstag

Jul 25, 7:25am

Even if someone gave you the land free, you couldn't build those houses now.

DubuMfalme

Jul 25, 7:29am

True, but most of those homes have some "useful life" left

donnerstag

Jul 25, 7:34am

Not true. OKC is still cheap, but not that cheap.

Samsonite

Jul 25, 10:26pm

Do a redfin search of homes of the OKC metro area and 60 homes are under $100K

donnerstag

Jul 26, 7:05am

They aren’t at all “the same houses” in that post.

Samsonite

Jul 26, 11:38am

I double checked. To get to 2,000 SF

donnerstag

Jul 26, 11:56am

There are plenty of condos, townhomes, and small starter homes for less than $300k in the

Skeptical Optimist

Jul 25, 7:26am

The single family homes in that range are arguably knock downs at that price

donnerstag

Jul 25, 7:37am

That last one would be an upgrade for TNT

TNT

Jul 25, 8:21am

Since when is a 4/5 bedroom house a starter home? I think you're wrong. Those weren't starter homes back then either.

supertux

Jul 25, 7:50am

These weren’t ‘starter’ homes LOL adjust your expectations

kotacoug

Jul 25, 8:32am

My first home I bought in 2006 for 47,500 in MO. It was a true starter home.

MrSandman

Jul 25, 9:03am

A well below average home is $400K in Utah

donnerstag

Jul 25, 7:23am

Your down payment hypothetical ignores historical first-time buyer patterns.

Abe Froman

Jul 25, 7:35am

Agree. Most first time buyers are putting down 3-5%

donnerstag

Jul 25, 7:39am

That just means a loan on a higher principal balance, increasing the monthly

byuinva

Jul 25, 9:17am

Yes, I’m aware of the trade off. When people can’t afford large down payments,

Abe Froman

Jul 25, 9:19am

$500k loan w/ 3% down for 1st time home buyer $3150/month (30 yr) +200/mo PMI

BYU'01

Jul 25, 2:55pm

Does that include property tax and home insurance?

donnerstag

Jul 25, 4:01pm

No: principal, interest, PMI

BYU'01

Jul 25, 4:32pm

Well sure, but even a 1500 square foot town home costs over $400k nowadays.

cougarfan84

Jul 25, 8:14am

No.

Abe Froman

Jul 25, 8:23am

The 2 cheapest properties for sale in my zip code:

cougarfan84

Jul 25, 8:41am

Lots of people can’t afford to live in the zip codes they want. That’s one of

Abe Froman

Jul 25, 6:39pm

We should have more empathy for you guys who live in Utah, not this generation.

CougarScrub

Jul 25, 10:12am

I think it's the accumulation of generations of over-educated workers willing to

goodcleanfun

Jul 25, 10:24am

I don’t think UT salaries are lower. UT is almost entirely owned by US Fed Govt

BYU'01

Jul 25, 3:07pm

They are in certain fields. If you're a professional with an advanced degree,

CougarScrub

Jul 25, 3:20pm

Advanced degrees in anything but dentistry, podiatry, etc I’d say Utah competes

BYU'01

Jul 25, 4:36pm

Anybody who bought a house before 2019 should be doing nothing but expressing

elmerfudd

Jul 25, 7:01am

I’m thrilled I bought a home in 2020. Wish I would have stretched more.

orrin7

Jul 25, 7:05am

"But I worked really hard and bought a house in 1984 when rates were 13%!"

YOHONOMOTO

Jul 25, 7:12am

And here's another thing nobody is factoring in outside of housing costs

YOHONOMOTO

Jul 25, 7:45am

There's a potential flip side to that as well - dual income households

BYUfan92

Jul 25, 9:08am

You say that like it’s a good thing. It’s another bad thing for this younger

YOHONOMOTO

Jul 25, 10:25am

I agree its not good, and didnt say it was, only that its a legitimate factor

BYUfan92

Jul 25, 12:03pm

Oh, great news everyone, both parents can work now!!! Day care costs and stranger raising your kids doesn't matter...

Atmospheric_Cougar

Jul 25, 10:37am

Odd interpretation of something I didnt say

BYUfan92

Jul 25, 12:04pm

People play by the rules of the day.

Archaea

Jul 25, 7:20am

Agree with that. There are also some big advantages this generation has too

BYUfan92

Jul 25, 7:15am

So you’re silver lining for this gen not being able to afford a home is at least

OnEMoReTrY

Jul 25, 8:21am

So you pick out 1 line and ignore the entire rest of my post? Selective much?

BYUfan92

Jul 25, 9:05am

Low barriers to entry doesn't mean everything is great. It means increased competition -> more price wars etc.

Atmospheric_Cougar

Jul 25, 10:39am

Low barriers also make it easy to test, fail, restart without significant cost.

BYUfan92

Jul 25, 12:15pm

I agree with your points, it is not all bad. What is a viable long-term business model with low barriers to entry?

Atmospheric_Cougar

Jul 25, 2:33pm

You don't blame them for being lazy? Interesting.

coug10278

Jul 25, 7:15am

Are they lazy, though? Or just discouraged?

DubuMfalme

Jul 25, 7:18am

Young people not having the same size families started before the housing issues

BYUfan92

Jul 25, 7:31am

… or … don’t insist on living in one of the highest demand housing markets.

goodcleanfun

Jul 25, 7:18am

True, but those places usually have worse job prospects.

DubuMfalme

Jul 25, 7:21am

I think that has (almost) always been the case.

goodcleanfun

Jul 25, 7:23am

But the relative gap between home prices and income has grown

memento

Jul 25, 7:25am

Go east, young man. Texas (except Austin) is half as expensive to buy as Utah, and job prospects are just as good

byujag

Jul 25, 8:21am

Where I live is arguably one of the fastest growing areas of the US. And has some of the best jobs in just about every

unctoothman

Jul 25, 4:33pm

RE: … or … don’t insist on living in one of the highest demand housing markets.

Blue chunks

Jul 25, 7:55am

Where do you live?

Powerbait DPM

Jul 25, 8:03am

People making $40000 can buy a house in Missouri.

bigbluecougar

Jul 25, 7:19am

"I should buy all those houses in Missouri and rent them out 🤔" - foreign money

ryebrye

Jul 25, 8:05am

Well there are still plenty for sale so China hasn’t bought them all

bigbluecougar

Jul 25, 8:10am

The current generation needs to move to where housing is affordable.

Conan

Jul 25, 7:29am

That's still not great, though.

DubuMfalme

Jul 25, 7:31am

NIMBYs won't let affordable options near them, though.

runnincoug

Jul 25, 7:36am

Then give me more roads. Nobody wants to live in gridlock.

Spine

Jul 25, 6:17pm

We could recognize work from home helps out young families in multiple ways including this example.

Atmospheric_Cougar

Jul 25, 10:12pm

People have always had to make trade offs, Dub. This isn’t new.

Abe Froman

Jul 25, 7:41am

Yep

Forest Green

Jul 25, 7:43am

People have done this for years

bigbluecougar

Jul 25, 7:42am

That’s called life man. Moving away from family and starting your own. You don’t

kotacoug

Jul 25, 7:57am

Over the last 40 years, the average new home size has increased by over 150%

Skeptical Optimist

Jul 25, 7:31am

I just looked up our first home, we bought in 2003. It was 1399 sq ft and it

BYUfan92

Jul 25, 7:48am

How much did you pay for it and what is it worth now?

Odysseus

Jul 25, 8:44am

IIRC we paid about 145K and Zillow shows it 399k-419K (Boise, Idaho market)

BYUfan92

Jul 25, 9:07am

People are buying those homes because those are the homes that are being built.

memento

Jul 25, 8:53am

builders are building those homes because they're the ones that sell fastest.

HarlemCoug

Jul 25, 8:58am

That's my point; in a market with constrained supply, why would builders

memento

Jul 25, 11:16am

It wont last forever. Bubbles burst eventually

chismoso

Jul 25, 7:59am

Well, lazy will work for 'em. Wait ... lazy works.

KCFan85

Jul 25, 8:09am

"I don't blame this upcoming generation for being lazy or complaining." Really? No excuse for that period.

ManicBlue

Jul 25, 9:01am

I agree the housing market is tough, but new grads are now getting 3x what you

My2cents

Jul 25, 9:42am

More true starter homes are needed. 2 bedrooms, some storage. That was our

refunder

Jul 25, 10:27am

Empathy is needed on both sides.

Ham

Jul 25, 11:20am

I wouldn't say it's easy to make an $800 payment on less than $2k a month after

Thrill

Jul 25, 11:51am

You're not wrong in that home prices in certain parts of the the country have

Nagurski

Jul 25, 4:32pm

I hear you but my son is making $160,000 after graduating from UVU 4 years ago.

O Gaucho

Jul 25, 10:14pm

I agree with you. I thought it was tough for me (mid 40s) but even harder for

Mitty

Jul 26, 11:18am

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