the American dream=dead??? (employed, 100k, money, business)

[selhars]

Knight2009I have a 2-thou sf house 3 BR, 2.5 BA, attached garage in Bowie, on a 1/4 acre -- paid 220,000 in 2003....no money down, 100% financing, NO PMI. My neighborhood is established, quiet, safe, well-kept, original owners and some young families, and everything in between.

My commute in morning rush when I worked days was one hour. (would be but I work 4p to midnight)

In the area I live in for example, the average, modest non-luxury home goes from anywhere $600k - $800k or even higher, on the market -- there is no way you are going to be able to buy for less than a bare mininum of $600k in this market, and even finding something that low in price is going to be extremely hard to do.

Also just wanted to check, are we talking an apples to apples comparison here, meaning a single-family, detached home property that is at least 1300 sq. ft. or more?

Thanks for the conversation. I did a search on Realtor.com and zillow.com and found plenty of houses below 400,000 in Silver Spring...it's close in, AND in Montgomery County. And I found some places in Alexandria, VA. Maybe we'll end up agreeing to disagree. but the fact is you CHOSE to by a 600-thou house...you didn't HAVE to -- you CHOSE to. And there ARE plenty of CLOSE-IN houses in nice areas for less than what you paid for yours. Now if they don't meet your criteria for whatever reason, that's fine. But that's YOUR choice, NOT just housing prices or the market.

[Phoenix2017]

Originally Posted by selhars

Knight2009I have a 2-thou sf house 3 BR, 2.5 BA, attached garage in Bowie, on a 1/4 acre -- paid 220,000 in 2003....no money down, 100% financing, NO PMI. My neighborhood is established, quiet, safe, well-kept, original owners and some young families, and everything in between.

My commute in morning rush when I worked days was one hour. (would be but I work 4p to midnight)

Thanks for the conversation. I did a search on Realtor.com and zillow.com and found plenty of houses below 400,000 in Silver Spring...it's close in, AND in Montgomery County. And I found some places in Alexandria, VA. Maybe we'll end up agreeing to disagree. but the fact is you CHOSE to by a 600-thou house...you didn't HAVE to -- you CHOSE to. And there ARE plenty of CLOSE-IN houses in nice areas for less than what you paid for yours. Now if they don't meet your criteria for whatever reason, that's fine. But that's YOUR choice, NOT just housing prices or the market.

That is wonderful to hear that you found such an amazing property; congrats!! I will freely confess that I know very little about Maryland properties, having only ever lived in NOVA.

The website I was looking at to gauge the prices in nearby house property comps to my own is the Fairfax County Department of Tax Administration's Real Estate Assessment Information Site (if you click on the "Property Search" button, you can find public records info, included price, sales info, house specs, etc. of any residential property in Fairfax County).

Also FWIW, in 2003, the total assessed value of my property by Fairfax County at that particular point in time was about $386k, whereas today in 2013, it is assessed by the county to be worth at least about $600k. In 2000, it was assessed at about $257k. The differences in the assessed price value between these past 12-13 years since 2000 honestly astounds me, b/c it makes me wonder just how exactly a house's value can magically increase by about $340k, in this relatively short amount of time -- and it is for this reason (i.e., artificially inflated assessed home values), that really makes me think that the average, middle class worker is intentionally being priced out the D.C. housing market in certain areas, and getting a raw deal, overall...

IMO, the only choice I really had in this case was whether I wanted to buy at the time that I did for ~$600k -- please note that I didn't exactly have a choice about whether I wanted to buy at assessed 2003 or even 2000 price values. As I indicated above, the difference in assessed price between 2013 and 2000 was a little over $340k. I am still ultimately happy about the purchase though, because I have a 45-minute commute (one way, x2 roundtrip), a little over 1300 sq. ft. (not counting the basement), and a 1/3 of an acre lot

Thank you also for the very interesting conversation as well, btw!

[Teckeeee]

For most, I don't think it will be viable for several years. That's what it's going to take for an economic recovery. Until then enjoy grinding it out.

[im_a_lawyer]

Originally Posted by Knight2009

Hmm, methinks that perhaps you sound like another promoter of the interests of big business, rather than the interests of the average, everyday working man...

oh the irony.... mortgage and banking industry is the biggest business in this country. Your debt is making some people very very rich. Am I wrong?

Originally Posted by Knight2009

Why do you get to decide who owns and doesn't own a house?

I don't! I want federal government out of this market. Local government should decide what gets build and whatnot. Current system penalizes people like me who are anti-debt and who don't need 3000 sqft house for $300,000 but due to the way things are this is all what's getting built these days and somehow that's normal and I'm crazy?

Originally Posted by Knight2009

Houses were much more affordable in decades past, than they are today.

houses were also MUCH smaller with more people living in them back in the day...

Originally Posted by Knight2009

Sometimes I honestly wonder if the housing price inflation is on purpose, to intentionally price people out of the market.

It's all a huge scam.

WHAT IF I TOLD YOU that home buyers tax credit($8000 in free money from the gov.) was only made for the purpose of boosting GDP in order to make the economy look better(same with cash clunkers program too). PLEASE HOLD ON TO YOUR HUGE DEBT because low GDP will make us look bad!

Do you know what holds China's GDP so high? Yup... High housing prices is very good business.

Originally Posted by Knight2009

Again, the 30-year fixed mortgage was specifically created to with the goal of to *help* the average middle-class home buyer, not hurt them. The problem was when housing prices artificially skyrocketed past the ability of the average consumer to buy them.

that problem WAS caused by the government and the greed of people... government didn't help anybody except those in the early stages of this ponzi scheme called housing.

Originally Posted by Knight2009

Enter inflation...the root problem is not the housing market, but the devaluation of the U.S. dollar in historical terms...

.... housing is not some magical resource. It's just pieces of concrete built by high school graduates.
Land cost + labor cost + resources cost = price of house

Where does the US dollar come in?

this isn't complicated at all just leave government and banks out of this..

[Phoenix2017]

Originally Posted by im_a_lawyer

oh the irony.... mortgage and banking industry is the biggest business in this country. Your debt is making some people very very rich. Am I wrong?

Admittedly, yes -- although the mortgage interest rate tax deduction and the building of equity in the property over time at least help me as a consumer, as well. In any event, I plan on staying in my current property until (and then continuing after) the mortgage is paid off; I will never move or take on another mortgage on a new property, ever again. I fully plan on paying off my mortgage loan, and am not looking to "upgrade" for anything bigger or fancier.

I don't! I want federal government out of this market. Local government should decide what gets build and whatnot. Current system penalizes people like me who are anti-debt and who don't need 3000 sqft house for $300,000 but due to the way things are this is all what's getting built these days and somehow that's normal and I'm crazy?

Interesting -- but do you really think that the private sector is going to actually going to be more of a champion for the middle class in buying homes, rather than the federal gov't? The government's influence is the very reason that the U.S. enjoys the benefit of the 30-year, fixed mortgage loan to begin with -- if it were up to the private sector, don't you think that we'd all have floating-rate ARM loans?

Also, what benefit do you think there would be toward local governments being involved in mortgage loans, rather than the federal gov't?

houses were also MUCH smaller with more people living in them back in the day...

I actually don't disagree with you at all, on that point...

It's all a huge scam.

WHAT IF I TOLD YOU that home buyers tax credit($8000 in free money from the gov.) was only made for the purpose of boosting GDP in order to make the economy look better(same with cash clunkers program too). PLEASE HOLD ON TO YOUR HUGE DEBT because low GDP will make us look bad!

Do you know what holds China's GDP so high? Yup... High housing prices is very good business.

I wouldn't really know as I bought my property before that benefit was offered I think; so I will have to take your word for that...

that problem WAS caused by the government and the greed of people... government didn't help anybody except those in the early stages of this ponzi scheme called housing.

.... housing is not some magical resource. It's just pieces of concrete built by high school graduates.
Land cost + labor cost + resources cost = price of house

Again though, do you think that the private sector is going to care about the average consumer's interest, vs. the govt? At least the gov't offers us tangible and practical benefits, like the 30-year fixed mortgage loan, the mortgage interest rate tax deduction, etc., etc. If the private sector stepped in to fill the government's shoes, I somehow seriously doubt that they would ever be as generous as the gov't has been to consumers, historically?

Where does the US dollar come in?

this isn't complicated at all just leave government and banks out of this..

Isn't the massive decrease in value of the U.S. dollar one of the concrete reasons why housing prices have gone through the roof, in the past 20-30 years though? Why a house that was worth say $70,000 in the 1960's is potentially worth $700k, today?

[andywire]

Originally Posted by im_a_lawyer

oh the irony.... mortgage and banking industry is the biggest business in this country. Your debt is making some people very very rich. Am I wrong?



I don't! I want federal government out of this market. Local government should decide what gets build and whatnot. Current system penalizes people like me who are anti-debt and who don't need 3000 sqft house for $300,000 but due to the way things are this is all what's getting built these days and somehow that's normal and I'm crazy?



houses were also MUCH smaller with more people living in them back in the day...



It's all a huge scam.

WHAT IF I TOLD YOU that home buyers tax credit($8000 in free money from the gov.) was only made for the purpose of boosting GDP in order to make the economy look better(same with cash clunkers program too). PLEASE HOLD ON TO YOUR HUGE DEBT because low GDP will make us look bad!

Do you know what holds China's GDP so high? Yup... High housing prices is very good business.




that problem WAS caused by the government and the greed of people... government didn't help anybody except those in the early stages of this ponzi scheme called housing.




.... housing is not some magical resource. It's just pieces of concrete built by high school graduates.
Land cost + labor cost + resources cost = price of house

Where does the US dollar come in?

this isn't complicated at all just leave government and banks out of this..

I never thought I'd see the day when I would find myself agreeing with a lawyer. I guess some of you are alright

Personally, I would love just a small, two bedroom, one story house with a basement. They don't build em like that anymore. Many potential consumers are forced into buying more house than they need, and more house than they can afford. It really is a big racket. The banksters have declared themselves public enemy #1 long ago by facilitating the conditions for a future collapse. Of course, the tax payers were held hostage and used to bail them out. Inevitably, the process will repeat.

[im_a_lawyer]

Originally Posted by Knight2009

Admittedly, yes -- although the mortgage interest rate tax deduction and the building of equity in the property over time at least help me as a consumer, as well.

interest rate tax deduction just lets you borrow more which makes everything more expensive(see: colleges) and on top of that it's costing US government something like $100 billion a year...

Originally Posted by Knight2009

Interesting -- but do you really think that the private sector is going to actually going to be more of a champion for the middle class in buying homes, rather than the federal gov't?

Under a private sector, home prices would match what people can actually afford. That's all you get.

Private sector(free market) wouldn't give you a bigger house but prices would definitely fall and types of housing built will change.

No more tract housing for $400,000 for "middle class" people because in reality, most people can't afford that.

Originally Posted by Knight2009

The government's influence is the very reason that the U.S. enjoys the benefit of the 30-year, fixed mortgage loan to begin with -- if it were up to the private sector, don't you think that we'd all have floating-rate ARM loans?

I was hoping for less debt in general...

Originally Posted by Knight2009

Also, what benefit do you think there would be toward local governments being involved in mortgage loans, rather than the federal gov't?

Local government will have no role in financing.

Local government's role in this is to basically prevent another Las Vegas or Phoenix through zoning laws because those types of developments were ponzi schemes right from the beginning. Cities growing just because they're growing. Soon as people stop moving in due to housing becoming too expensive due to inflated demand, values crash, bunch of people stuck with underwater mortgages. Rinse and repeat this on another city.
Local governments allow this scheme to thrive and continue because it's great for them short term but it always fails long term.

Originally Posted by Knight2009

I actually don't disagree with you at all, on that point...

Right, so how can people complain about RISING HOUSING COSTS? No such thing. It's your demand for space that has skyrocketed. Why wouldn't you expect price of housing to triple or quadruple?

Originally Posted by Knight2009

At least the gov't offers us tangible and practical benefits, like the 30-year fixed mortgage loan, the mortgage interest rate tax deduction, etc., etc. If the private sector stepped in to fill the government's shoes, I somehow seriously doubt that they would ever be as generous as the gov't has been to consumers, historically?

letting people borrow more won't help.

Originally Posted by Knight2009

Isn't the massive decrease in value of the U.S. dollar one of the concrete reasons why housing prices have gone through the roof, in the past 20-30 years though?

As I said before: Why is housing such a special resource? Think about it. Nothing has went up in price in the last 20 years. Everything in fact got cheaper. Shouldn't the same happen with housing? Constructors or whatever certainly got more efficient at building houses in the last 20 years. Price of concrete didn't skyrocket in the past decade so what's the problem? Limited land(not really, US has by far the most usable land in the world) but it's only "limited" due to poor zoning laws(coming back to the role of local government)

Houses are expensive because certain people profit from them being that expensive. Oh, and it makes the country look richer(see: China).

Originally Posted by Knight2009

Why a house that was worth say $70,000 in the 1960's is potentially worth $700k, today?

$70,000 in 1960s was as much in those days as $~500,000 is now but this isn't the point as housing was still much more affordable back then.

Types of housing, its size and a bunch of "middle class" people who are able to take out 600K mortgages is what's inflating the prices.

Originally Posted by andywire

I never thought I'd see the day when I would find myself agreeing with a lawyer. I guess some of you are alright

I'm not a lawyer

[SOON2BNSURPRISE]

Originally Posted by jaredC

So, like the title reads, is it dead? I believe the old american dream (home ownership, cars, boats, a nice career, a retirement fund, traveling after retirement) is dead. I think the new american dream is much much simpler. Like getting a job, and holding onto it, maybe getting a car. But the way I see it, sentiment in the US is at its all time low. And for good reason. The working american is at war with its own country. When jobs are scarce and the cost of living skyrockets, its hard to imagine anything other than doom and gloom.

For my family let me explain how we are doing.

Home ownership: Purchased our first home in December of 2010. Prices were amazing due to the drop from the popped bubble. I see even now that this is a time to buy a home.

Cars: We have a family van and a few other cars. They are older but our goal is to pay off the home in 12 more years or less. We will buy newer cars when that is done.

Boat: Had one. Looking for another. We live near the coast and seeing the Pacific ocean with the Channel Islands off the coast every day is a big part of life.

Nice Career: I for one love what I do. The pay supports my family. Sure, my wife also works and at the same hospital that I work at. I plan on putting in another 30 years here. I have been here for 15 so far.

Retirement fund: If you are talking pension then no. I do have a 403B and the employer pays 2% of our income toward it. They also pay up to 3% if we put in at least 6%. I think that you need a minumum of 10% to get the kind of retirement that most would want. You can put in $18,000 a year pretax. For us that will get us where we want to be when I do retire. I am not counting on Social Security to help out. Remember though that you have to start early to get where you want to go.

Traveling after retirement (And for some of us during the working years): Why should this not be a goal that you can realize?

The American Dream is not only attainable it happens for many many Americans. Not only is it happening but one of the fastest growth areas within the Middle class is the Middle Class Millionaire. Within the next 10 years the numbers will increase to somewhere around 20 million I have been told. I would say that things are going great for the nation.

Jobs are scarce in specific fields lets say. Still remember that many jobs are no longer needed. I mean how many Type writer repair people do you know? Things change and people need to change with the times. New jobs that did not exist 10 years ago are begging for people to fill them. The problem? Few plan for new fields. Few plan for change.

[im_a_lawyer]

SOON2BNSURPRISE, you're basing the state of the country on your personal well being?

Not everyone had the opportunity to buy a house during a crash. Most people are stuck paying off their first house which they can't sell without losing tons of money. Many would love to exchange their house for something of the same size at half the cost.

Not everyone works in healthcare - industry that's been in a bubble forever and refuses to pop.

[NJBest]

Originally Posted by im_a_lawyer

SOON2BNSURPRISE, you're basing the state of the country on your personal well being?

Not everyone had the opportunity to buy a house during a crash. Most people are stuck paying off their first house which they can't sell without losing tons of money. Many would love to exchange their house for something of the same size at half the cost.

Not everyone works in healthcare - industry that's been in a bubble forever and refuses to pop.

That's not what was said at all. They said that the American dream is attainable. I'd go one step further and say that it's very attainable.