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Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

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Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#171

Post by darrenf »

hans1729 wrote: post #118
pjc50 wrote: post #105

Earlier quoted context omitted.

> Going in debt for 30-40 years has zero appeal for me Going into debt at the lowest interest rate you'll ever be offered to buy a leveraged asset that's likely to increase in price and reduce the overhead you pay on your largest expense, housing, and hedge against the risk of rent increases and security against the whims of landlords? > Germany Oh, Germany. Somehow Germany has escaped the constantly increasing house…

> Going into debt at the lowest interest rate you'll ever be offered to buy a leveraged asset that's likely to increase in price and reduce the overhead you pay on your largest expense, housing, and hedge against the risk of rent increases and security against the whims of landlords? Look, if I had enough money around, I'd maybe consider the gamble. But I don't want to buy property to sell it later, I just want to li…

I spent most of my 20s thinking, man, fuck home ownership, I'm gonna rent forever (to my knowledge, no-one in my family had ever owned; I grew up in charity housing and inherited nothing at all). Then I got booted out of a place because the landlord wanted to sell. They offered it to me first, but I had no savings for a deposit. The same story played out amongst my friends, repeatedly, and it totally changed my mind. It wasn't rent increases that were worrisome or painful, it was being forced to move. I wanted to find somewhere I liked and bloody stay there, a literal impossibility all the while I rented. But if I could get a deposit together† then ownership would do it - plus it was revelatory to me that my mortgage payments would be less than the rents I'd been paying AND I could have them fixed for 10 whole years.

I didn't buy because it was a step onto the property ladder. I bought because it was less of a gamble than renting. I ended up staying in my first house for 17 years, whereas my record under a single landlord was 3.

> Maybe in 10 years I want a year off? What then? Maybe I want to change careers to something less intellectually demanding. Maybe I want to spend 50 hours a week with my kids. None of those are feasible if I need the salary.

During those 17 years I took at least two pay cuts, and multiple 2-6 month breaks between jobs, all affordable because I owned rather than rented. Lower outgoings made it possible to save more, plus my mortgage provider offers payment holidays. No landlord ever did!

> I opt for quality of life, which I don't achieve by giving it all to some property-owning entity who sells it to me at 3 times the price they paid a couple decades ago.

I mean, isn't "paying rent to a private landlord" doing just that? Except "sells it to me" is actually "allows me to live there, until they decide not to" and all the money you spent is gone.

† I lucked out with a lump sum/windfall through my employer; I'm making no claims that getting a deposit is easy/attainable

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#172

Post by refurb »

elevaet wrote: post #113
refurb wrote: post #27

Earlier quoted context omitted.

And a median sale price that has hit ~$800,000, which is double the US.

It's nuts. Canada has a lot of good things going for it, but housing affordability is at a crisis point.

It is. You can just look at the US and Canada over the same time period to see how out of wack Canada is.

Canada is basically the US minus the 2008 crash. It's just price inflations non-stop for 20 plus years.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#173

Post by onlyrealcuzzo »

doctoboggan wrote: post #170

My wife and I will be moving to Chicago soon and we intend on buying a house when we get there. How screwed are we by the current housing situation and interest rates?

How soon?

If trends continue, prices will start falling. You might be able to offer under asking, too.

I bought 15% under asking in October of last year.

Chicago didn't really go crazy like Phoenix or Palm Springs...

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#174

Post by kasey_junk »

refurb wrote: post #161
nikanj wrote: post #130

Earlier quoted context omitted.

"Greater Kelowna is the fastest-growing urban area in the country, Statistics Canada reported Friday. The Central Okanagan's population rose 14% between 2016 and 2021, from 194,892 to 222,162, according to information gathered during last year's census." In fact, all three of your examples are on the list of fastest growing locations - Halifax at 8th and Barrie at 13th https://canadamag.ca/fastest-growing-cities-in-c…

"Fastest growing urban area in Canada" is like the "fastest sprinter at the senior center". Sure it's fast relative to other cities, but not in an absolute sense. Kelowna grew 14% over 5 years? So 2.7% a year? Or 5,500 people per year? Kelowna is a tiny town in the middle of BC. Jobs are scarce. Vast swaths of undeveloped land surround the town. Wages are pretty typical, yet a modest house is $1,000,000. Does that ma…

Kelowna is part of the Okanagan tourist area and on the lake. What happens to the analysis of home prices when you remove the houses within walking distance to the water?

It’s been a few years since I was there but last I was it had the very common tourist pattern of expensive vacation homes near the water for wealthy part time occupants and reasonable housing further away for permanent residents.

Frankly that area was better than many tourist areas where workers have to commute long distances to live in crap apartments or worse dormitories.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#175

Post by onlyrealcuzzo »

hans1729 wrote: post #19
cammikebrown wrote: post #2

Seems like the bubble burst is going to be more sudden than we thought. 30 year mortgages are suddenly at nearly 5.5-6%, listings are sitting on the market for longer, and multiple cities are cracking down on Airbnb.

I mean, it's not really a burst, we're just hearing the hissing noise of the obvious leak. The true demand from people with the intend to actually live in the estates has been constantly decreasing since around 2000; the real salarys dropped since then, so did the buying power. The only reasons people found buyers at x3-x10 (!) prices were a) that there is a class of people wealthy enough to still afford the purchase…

You're forgetting a.2) the "wealthy" people usually have high incomes, and the x10 houses are usually in high tax states, and housing is a huge tax break.

~20% or my housing "cost" is paid for by a tax break for owning a house. Another ~20% is principal.

When you also factor in that the Fed guarantees to devalue money at AT LEAST ~3% per year, and you have 5x leverage (or more) - that's another ~15% effectively subsidized by the government.

So when you have sufficient cash flow - it's easy to look at your housing "cost" as only ~40% of the actual payment.

Compared to rents, this is a steal.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#176

Post by patentatt »

doctoboggan wrote: post #170

My wife and I will be moving to Chicago soon and we intend on buying a house when we get there. How screwed are we by the current housing situation and interest rates?

Very anecdotally from my Chicago (close) suburb: a little bit screwed. The available inventory in my neighborhood is the lowest I've ever seen for early spring, there's just very little up for sale.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#177

Post by matwood »

hans1729 wrote: post #118
pjc50 wrote: post #105

Earlier quoted context omitted.

> Going in debt for 30-40 years has zero appeal for me Going into debt at the lowest interest rate you'll ever be offered to buy a leveraged asset that's likely to increase in price and reduce the overhead you pay on your largest expense, housing, and hedge against the risk of rent increases and security against the whims of landlords? > Germany Oh, Germany. Somehow Germany has escaped the constantly increasing house…

> Going into debt at the lowest interest rate you'll ever be offered to buy a leveraged asset that's likely to increase in price and reduce the overhead you pay on your largest expense, housing, and hedge against the risk of rent increases and security against the whims of landlords? Look, if I had enough money around, I'd maybe consider the gamble. But I don't want to buy property to sell it later, I just want to li…

> I just want to live somewhere

Same. Which is exactly why I bought a house in 2011. In hindsight it was the perfect time, but at the time the market was still bumpy. At the end of the day, I had a stable job and needed to live somewhere.

> I make enough money not to worry about rent, even if it should substantially increase

The house next door to me rents for 2.5x my mortgage.

My salary has continued to go up, while my cost to live has continued to go down (I refied at the rate bottom). If I want to take a year off I can either rent out my house or just carry the cost at this point. Buying this house gave my wife and I more flexibility because with some decent certainty (+/- small amounts for taxes/insurance fluctuations) I can tell you what my cost to live will be next month or 24 months from now.

Finally, buying a house with a mortgage is best way for a normal person to protect against inflation. Housing is typically a families #1 or #2 expense, and being able to mostly lock that cost is a huge win 3-5-10 years out.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#178

Post by xwdv »

ssharp wrote: post #160
streblo wrote: post #134

Earlier quoted context omitted.

Most people don't do the math and realize that over a long enough time horizon a 30 year fixed mortgage will cost you less than purchasing the home outright. This assumes you take the money you would have sunk into the home and instead invest it at a higher rate of return, which is an option available to most home owners.

Well most people aren't going to take the money and invest it at a higher rate of return, either. With 30-year rates around 6% right now, the math becomes a lot tighter as well. Where are you going to find 6%+ investments right now?

You don’t actually have to invest at all. Over time inflation makes your payments cheaper and cheaper. By the time you reach the end of your 30 year fixed mortgaged in the year 2052 you’re still paying in 2022 dollars which is probably less than half of what the average mortgage in 2052 is.

If you invest on top of that and get some small decent return you come out even more on top.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#179

Post by brianwawok »

geoduck14 wrote: post #169
tzs wrote: post #148

Earlier quoted context omitted.

> that people were given loans they should either never have gotten (2008) or that they shouldn't have asked for I bought my house in early 2007 and mortgages were indeed crazy back then. My analysis said that at the mortgage rates for a 30 year fixed mortgage back then (a tad over 6%) said that my ideal home financially would be around $H or less, that I could go up to 1.25 $H without house payments being high enoug…

I'd like to provide some context around the approved amount. Countrywide (and other originators) get their rates from Fannie Mae and Freddie Mac. These two have guidelines set to approve X monthly payment based on your income (for instance, you can spend 28% of your income on your primary house). These guidelines are set for BROAD populations - specifically very poor and "normal" people have the same guidelines. For…

Imagine if billionaires used the 28% rule.

Important to compare like renting a modest Apartment. If that payment that works for you is X, maybe 3X is too much house? Houses also take a lot of repair, and need things like new roofs and HVAC.

Re: Rocket Mortgage to trim 8% of workforce as home-loan market shrinks

#180

Post by dsm4ck »

doctoboggan wrote: post #170

My wife and I will be moving to Chicago soon and we intend on buying a house when we get there. How screwed are we by the current housing situation and interest rates?

Generally speaking as interest rates go up peoples purchasing power goes down as they try to keep the monthly payment manageable, which in theory could decrease demand and prices could go down.
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