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Nearly 40% of U.S. homes are mortgage-free, census shows

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Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#71

Post by ryandrake »

onlyrealcuzzo wrote: post #55
lo_fye wrote: post #42

Translation: Nearly 40% of US homes are mortgage-free (and owned by Boomers)

Translation: ~30% of homes have been owned for more than 20 years, and guess what happens at the end of a mortgage and after 20 years of inflation? And guess how much money the top 10% have? Close to $2m counting their house... You'll be old one day, too - believe it or not. The boomers aren't special. They're just old. One day they'll be dead, and you'll be the old person everyone complains about who owns their hous…

> One day they'll be dead, and you'll be the old person everyone complains about who owns their house and bought if for next to nothing 30 years ago.

How are these mythical "young but future homeowners" going to get a house? They're not buying them at today's prices and interest rates. And their Boomer parents are drawing down the equity via reverse mortgages to fund their retirements, so there won't even be equity to inherit when they kick the bucket.

My bet is when the Boomers are dead, the only ones left owning homes will be banks and private equity firms, and we'll all be renting from them.

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#72

Post by _ea1k »

fred_is_fred wrote: post #51
_ea1k wrote: post #12

Interesting, given all of the articles about increasing consumer debt. I'd guess that a lot more people are motivated to do this, with mortgage rates fluctuating upward so quickly over the last couple of years.

In fact the opposite is true. My mortgage is 2.125% and I have no motivation to pay that off because of rates spiking upward which gives me a better cash return than 2.125%.

I think there's some of both. Plenty of people with low interest rates have little motivation for payoff.

But if you are moving right now for any reason, you aren't likely to be taking on more debt in the process. There's a pretty strong incentive to do what it takes to get debt to or near zero.

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#74

Post by r00fus »

c22 wrote: post #46
Pigalowda wrote: post #33

Earlier quoted context omitted.

Blackrock and other funds buy thousands of homes and rent them out. Those are mortgage free homes.

You're probably thinking of Blackstone which spunoff from Blackrock in the 1980s. Further reading: https://www.blackrock.com/us/individual/insights/buying-hous... https://www.blackstone.com/housing/our-track-record-in-housi... https://www.helpadvisor.com/retirement/blackrock-vs-the-blac... https://fintel.io/news/blackrock-now-owns-490-of-blackstone-...

A distinction without a difference - they're both in the same rent-seeking model.

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#75

Post by c22 »

r00fus wrote: post #74
c22 wrote: post #46

Earlier quoted context omitted.

You're probably thinking of Blackstone which spunoff from Blackrock in the 1980s. Further reading: https://www.blackrock.com/us/individual/insights/buying-hous... https://www.blackstone.com/housing/our-track-record-in-housi... https://www.helpadvisor.com/retirement/blackrock-vs-the-blac... https://fintel.io/news/blackrock-now-owns-490-of-blackstone-...

A distinction without a difference - they're both in the same rent-seeking model.

I guess, except Blackrock literally does not buy houses whereas Blackstone owns "0.03% of single-family homes in the US" and rents them out.

A distinction that seems entirely relevant to the claim "Blackrock [...] buy thousands of homes and rent them out."

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#76

Post by jjav »

onlyrealcuzzo wrote: post #41
vintermann wrote: post #21

And how many percent of US homeowners are mortgage-free?

~67% of homes are owner occupied. It's unlikely ~100% of the investor owned homes are free and clear and only ~3% of owner occupied homes are owned free and clear. For one, the tax code HEAVILY incentivizes investors to own property on leverage. For two, the only reason property is/was a good investment was because of artificially low interest rates for most of the last ~25 years (an entire generation of investors).…

> the tax code HEAVILY incentivizes investors to own property on leverage

Can you expand on this claim?

Mortgage interest deduction is often talked about but realize that unless you itemize deductions you can't do it, and itemizing has been made very difficult so most people won't qualify[1].

There are many good reasons own your home, but tax code benefits is not one of them.

[1] https://taxfoundation.org/blog/standard-deduction-itemized-d...

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#77

Post by jjav »

willsmith72 wrote: post #20

> "If you stick with it, you'll get a low rate," he tells Axios. I love this kind of advice. It's so typical from someone who thinks they're self-made with no appreciation for their circumstances

I think you misunderstand the comment, it is a reference to how mortgages work in the US (I know not in most other countries).

You can keep ratcheting your interest rate down over the years, but it will never go up. When interest rates rise, you sit tight. When they drop, you keep refinancing.

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#78

Post by jjav »

ryandrake wrote: post #71
onlyrealcuzzo wrote: post #55

Earlier quoted context omitted.

Translation: ~30% of homes have been owned for more than 20 years, and guess what happens at the end of a mortgage and after 20 years of inflation? And guess how much money the top 10% have? Close to $2m counting their house... You'll be old one day, too - believe it or not. The boomers aren't special. They're just old. One day they'll be dead, and you'll be the old person everyone complains about who owns their hous…

> One day they'll be dead, and you'll be the old person everyone complains about who owns their house and bought if for next to nothing 30 years ago. How are these mythical "young but future homeowners" going to get a house? They're not buying them at today's prices and interest rates. And their Boomer parents are drawing down the equity via reverse mortgages to fund their retirements, so there won't even be equity t…

> They're not buying them at today's prices and interest rates.

Those boomers may have been buying houses in the late 70s when mortgage interest rates were over 10%, so today's rates would be a bargain.

Or for more recent numbers, in the late 90s rates were over 8 (my first mortgage was 8.5%)

The point being, current rates seem high only compared to the incredibly low rates of the past decade but they are not particularly high when seen over a longer time window.

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#79

Post by crotchfire »

dzdt wrote: post #39
vintermann wrote: post #21

And how many percent of US homeowners are mortgage-free?

Should be around 40%. The headline graph in the article has its data source as "Among owner-occupied housing units; Annually, 2012-2022". There shouldn't be much difference between percent of owner-occupied homes that are mortgage free and percent of homeowners who are mortgage-free.

Wealthy people tend to have second homes, which are also considered "owner-occupied".

Re: Nearly 40% of U.S. homes are mortgage-free, census shows

#80

Post by WarOnPrivacy »

bonyt wrote: post #8
WarOnPrivacy wrote: post #6

Well sure. The homes my landlord rents are mortgage free. I can say the same for folks I know with 2nd vacation homes and airbnb rentals. For the rest of my anecdata: For folks I know living in their own households, about 20% have it paid off. About half of those folks own multiple homes.

This specifies owner-occupied.

Appreciate the clarification. I was on my way out and didn't read thru.
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