Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

U.S. mortgage interest rates jump to 7.16%, highest since 2001

reuters.com

Post reply on HN
Print view View original

291–297 of 297 posts

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#291

Post by BuckRogers »

dividefuel wrote: post #158
symlinkk wrote: post #87

I’m pretty sure I bought at the worst possible time (March). Every month that goes by, thousands of dollars of my net worth disappear because of circumstances completely out of my control. It makes me doubt the value of hard work - sure, if you slave away at your desk job you can earn maybe an extra $30k a year, but the guy down the road who just happened to buy a house at the right time earned an extra $300k over th…

I bought at a similar time, right as rates were starting to really tick up. I got in at 3.75%. That time looks to be the tipping point, but in which direction is still not clear to me. Decreasing home value only matters if you need to sell. If you plan to live in your home for a long time, the changes in the dollar value of the house in the meantime aren't as big of a deal. However, spring was clearly the peak of thi…

I've been in the market for a home since summer 2021 and learned a lot. I've gone through multiple agents, realizing how useless most of them are. The one I do find useful said the buyers disappeared around April of this year. Which lines up with your stories.

I think buying around April is not the worst possible situation. You at least got the good rates, even if you got peak pricing. I've been grinding on sellers so hard that we either backed out or lost our deals. I'm flush with cash so other than not having a home, happy I'm still in the market as I expect sellers to get the message on the state of the market by January. 2023 is the year for anyone that has cash and has been waiting.

My deal won't be perfect either. It may require years of waiting to hit the bottom of the market. I am expecting 2019 pricing soon in my market in 2023, which is all that I'm aiming for.

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#292

Post by BuckRogers »

cameronh90 wrote: post #159
symlinkk wrote: post #87

I’m pretty sure I bought at the worst possible time (March). Every month that goes by, thousands of dollars of my net worth disappear because of circumstances completely out of my control. It makes me doubt the value of hard work - sure, if you slave away at your desk job you can earn maybe an extra $30k a year, but the guy down the road who just happened to buy a house at the right time earned an extra $300k over th…

Time in the market beats timing the market. You were always going to need somewhere to live, so whatever net worth you have that's locked inside your house is almost theoretical. Even if house prices crash a huge amount, they'll probably come back at some point, unless we're heading for an era of Japan-style stagnation. It's not ideal, but as someone in a similar boat to you (price agreed mid 2021), I'm probably goin…

That's true but we're talking a very long time when you look at how many decades of gains were priced into these peak prices. Most people that got into an even worse situation (~07) never did get back to purchase price to this day. From what I've seen, these recent peaks didn't match what was going on back then.

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#293

Post by snarf21 »

another_poster wrote: post #219
snarf21 wrote: post #144

Earlier quoted context omitted.

We should outlaw ARM for most people. It should only be for "accredited borrows" like we do for investing. People who don't really understand the risks get screwed and it creates unnecessary bubbles.

To play devil’s advocate, we really should ban 30 year fixed mortgages, not 5/1 ARMs. I know it sounds contradictory, but hear me out. One of the Fed’s primary methods to control inflation is adjusting economic demand by making loans cheaper or more expensive. In our current regime of fixed mortgages, new home buyers disproportionately bear the cost of the Fed’s effort to reduce inflation, since only they need to pay…

That is an interesting thought and I'll have to think about that more deeply. I think one thing that we need to remember is that with a fixed mortgage, you are paying tomorrow's mortgage at today's prices. As inflation rises and salaries rise to keep pace, your mortgage stays the same. It incentives home buying which is why there are so many government programs in this area. Obviously you don't want to just in at the top of the bubble, but getting in asap is a great strategy for most everyone.

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#294

Post by fundad »

andsoitis wrote: post #290
fundad wrote: post #243

Earlier quoted context omitted.

The former president threatened the fed chair to keep rates low. This president begs for “L”s over norms that no longer exist.

If you have to resort to "threatening" or "begging", isn't that a strong indicator of independence?

You misunderstood, figuratively begging by letting the Fed to MBNA’s bidding.

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#295

Post by rsj_hn »

frumper wrote: post #277
rsj_hn wrote: post #268

Earlier quoted context omitted.

In your area, they don't use square footage as an important factor in determining the price of a house?

It is. Smaller square foot houses tend to go for more per sq ft. That said, my house is 1700 sq ft built mid 50s. We looked at many anywhere from 1500-3000k built in the 50s and 60s. But a 1700sq ft house built in the 50s doesn’t get discounted over a 1700sq ft home built in the 2000s despite old plumping, electrical and insulation. Homes in disrepair obviously are cheaper, but that’s just as true for 20 year old hom…

So the post pointed out that home sale prices were increasing in time in terms of the performance of the asset class, and I pointed out that homes were growing in size, and you seem to have fixated on the age of the house rather than the fact that in 1950, the average home was almost 1/3 the size of the average home of 2022, and therefore you would expect it to be much less in price just on that basis alone.

I am not sure why there is a cognitive barrier in understanding this. When you buy a home, the performance of that asset will not benefit from comps of much bigger homes that are sold in the future. Is this really confusing? Why am I hitting a wall here? You need to look at price per square foot data if you are going to be doing comps across time, because houses are always getting bigger, but the house you buy is not going to get bigger.

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#296

Post by frumper »

rsj_hn wrote: post #295
frumper wrote: post #277

Earlier quoted context omitted.

It is. Smaller square foot houses tend to go for more per sq ft. That said, my house is 1700 sq ft built mid 50s. We looked at many anywhere from 1500-3000k built in the 50s and 60s. But a 1700sq ft house built in the 50s doesn’t get discounted over a 1700sq ft home built in the 2000s despite old plumping, electrical and insulation. Homes in disrepair obviously are cheaper, but that’s just as true for 20 year old hom…

So the post pointed out that home sale prices were increasing in time in terms of the performance of the asset class, and I pointed out that homes were growing in size, and you seem to have fixated on the age of the house rather than the fact that in 1950, the average home was almost 1/3 the size of the average home of 2022, and therefore you would expect it to be much less in price just on that basis alone. I am not…

You're hitting a wall because you changed your tune from "plumbing/electrical/insulation" to square foot size, and you're being rude. I don't think anyone disagrees that overall prices have gone up in homes that are larger. Where did I say a 950sq ft home goes for the same as a 3000 sq foot one?

Re: U.S. mortgage interest rates jump to 7.16%, highest since 2001

#297

Post by Beldin »

diogenescynic wrote: post #283
Beldin wrote: post #281

Earlier quoted context omitted.

> if you own you have to factor in maintenance, property taxes, and insurance. Around here, if you rent, your landlord factors those things into the rental price. Admittedly not necessarily the insurance; that typically is just a requirement of the lease.

The price to rent ratio compares the price to rent vs own. It’s definitely cheaper to rent than to own in many places. You can also get rent control in many cities so comparing renting to owning is going to vary with the specific situation.

I'm sorry, I must be missing some subtelty here. If renting is indeed cheaper than owning, landlords would be subsidising renters. That can't be correct...
Post reply on HN