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How Many Years of Life Does That House Cost?

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Re: How Many Years of Life Does That House Cost?

#21

Post by AustinG08 »

autokad wrote: post #9
dfrey wrote: post #7

Cool visualization, but kind of a useless statistic. The question that matters is: How many years will it take me to pay off my mortgage after my expenses (food, transportation, housing maintenance, utilities, taxes) are taken into account? It doesn't matter how cheap a house is if you can't save any money.

how many years will it take to pay off your mortgage? thats done for you, about 15 or 30. how does other factors like food/transportation/taxes factor in? though not always, but they tend to go hand in hand no? the cost of real estate is factored into much of what we buy / spend money.

It is honestly worth your while to pay off your mortgage as soon as humanly possible.

Re: How Many Years of Life Does That House Cost?

#22

Post by jdavis703 »

magic_beans wrote: post #8

Is it really necessary to own a home if your mortgage is going to be 20 years long? I get that renting is like throwing money in a hole, but people are so much more nomadic these days. What's the big deal in moving once every 10 years once rent gets unbearable?

Rent gets unbearable way faster than every 10 years. My first place in the Bay Area had rent jump from $1800 (uncomfortable but doable), to $2300 per month. This was after just one year of being there, and since then I've noticed that 4 years later rents in that neighborhood are now at $3300 a month for a one bedroom.

Re: How Many Years of Life Does That House Cost?

#23

Post by sbenitoj »

This is an awesome site, visually depicting how unaffordable housing has become in so many parts of the US.

It's truly amazing how much the Fed (with perpetually low interest rates) and local restrictions on building (making it more expensive or impossible to build) have increased the cost of home ownership over the past 60 years.

Anyone who's seriously considering purchasing a home should read The Housing Trap by Patrick Killelea, it's a short, amazing overview of how we arrived in the situation we're in as well as a practical guide for when to buy vs rent housing.

https://www.amazon.com/dp/1479156213/ref=cm_sw_r_sms_awdb_Ki...

Re: How Many Years of Life Does That House Cost?

#25

Post by losteric »

pjc50 wrote: post #10
Clubber wrote: post #4

That was a really nice overview. One thing to consider though, when you gain more expertise through experience, you typically gain more income. Of course, most of the time, homes tend to appreciate as well. But to the point, it's best not to burden yourself too much with a home. I bought mine in my late 20s. My criteria was that I didn't ever want to move again (and could fit a pool table), so I bought a house big en…

> bought a house big enough for a family to live comfortably that I could reasonably afford in my late 20s. Well, we'd all love to do that, but where? (That was a rhetorical question, I personally moved to Edinburgh and bought an affordable family house in my late 30s) I remember a website tracking London affordability that pointed out that in some years price appreciation made it literally impossible to save for a h…

Nowhere! If you're in SF, move out to the east bay

Besides that, hope residents use legislation to balance out the market... progressive taxes in aesthetically pleasing areas, education/public transportation in economically competitive areas, condos/up-zoning in popular urban areas.

Re: How Many Years of Life Does That House Cost?

#26

Post by FLUX-YOU »

pjc50 wrote: post #16
magic_beans wrote: post #8

Is it really necessary to own a home if your mortgage is going to be 20 years long? I get that renting is like throwing money in a hole, but people are so much more nomadic these days. What's the big deal in moving once every 10 years once rent gets unbearable?

Do you want to have pets? Do you want to redecorate to your own taste? Can you even find anywhere to rent? Not everywhere has a liquid rental market. Moving only once every 10 years sounds great. Renting means maybe having to move on notice as short as one month. Back when I was renting I moved about every 3 years, although that was also house-sharing with other young professionals. Rent is usually more expensive tha…

> also, obviously, after 20 years you have no more payments.

You have maintenance. And if something bad happens with the foundation, that's very expensive to fix. Unless you just plan to die and have the house demolished and the property sold (which is honestly preferable in some cases of inheritance).

I had to pay $25k to have supports installed in the crawlspace and other mitigation to avoid foundation work. I might have gotten ripped off, and the annoying thing is that I can't know for sure because I'm not informed about foundation work, structural engineering, or other principles.

Simply inheriting a house and trying to sell it turned me off from owning a home in the near future due to the arduous process of paperwork, red tape, maintenance, and a low-liquid market. I'll take a comfortable living van/RV over dealing with real estate again if it means I can reduce the risk of dealing with those things to zero.

Re: How Many Years of Life Does That House Cost?

#27

Post by zaroth »

sbenitoj wrote: post #23

This is an awesome site, visually depicting how unaffordable housing has become in so many parts of the US. It's truly amazing how much the Fed (with perpetually low interest rates) and local restrictions on building (making it more expensive or impossible to build) have increased the cost of home ownership over the past 60 years. Anyone who's seriously considering purchasing a home should read The Housing Trap by Pa…

That's funny, my takeaway was that the vast majority of the US has incredibly affordable housing.

But I suppose if your call center employees simply must be living in downtown S.F. the answer must be that we just need lax zoning and higher density!

Re: How Many Years of Life Does That House Cost?

#29

Post by sbenitoj »

lpolovets wrote: post #18

I liked the visualization and data, but I don't think it makes sense to compare home prices to wages w/o considering alternatives to home ownership. Home prices don't exit in a vacuum. That is, if a home is 10x the median salary, you can't really say "well, if I didn't buy a home I could work 10 years less." That's because the alternative to buying is renting, which is also expensive. So sure, a mortgage in SF is $6k…

You also have to factor in the opportunity cost of what you could've done with that down payment (e.g. What would a $100k downpayment invested for 30 years in the stock market be worth vs how much is that worth in your home in 30 years?)

The NYT has a buy vs rent calculator that helps make some of these decisions:

https://www.nytimes.com/interactive/2014/upshot/buy-rent-cal...

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