WatchPosted for Patrick.net reader B.
Patrick --
Something I don't read about much is whether it's still a good idea to even
consider buying a house at all, at any price, ever.
Things have changed so much in the last 15 years or so. How many people have
real job security? Apart from federal employees, not that many people. Fifteen
years ago the economy was way more stable, you could pretty much bet on having
a job the next year so you could pay your mortgage.
Second, most existing houses were built for a world that no longer exists --a
world where energy was cheap (to heat and cool your house, to drive to and from
the house,etc), a world where the economy was almost always expanding, where
jobs were plentiful and well paid, for the most part. A world where property
taxes, repairs, insurance and utilities were usually reasonable. None of those
things are cheap anymore. Most houses are also poorly located too far from good
mass transit, shopping, jobs, etc, since city planning in most US cities has
been so poor. Not to mention that most US houses are at best of mediocre
construction quality, built with cheaper materials, requiring constant and
expensive maintenance.
Buying a house in an unstable economy with declining job prospects means that
it's unlikely you will be able to sell the house down the road in a few years
for what you paid, thus you won't be able to move to another area in case your
job evaporates and the local economy tanks. Federal loans can't prop up the
housing market forever, and the economy really no longer needs that many people
to function, with automation and outsourcing.
The single family home may be an artifact from an earlier time that served a
purpose for a time, but for the above reasons may just not work anymore for
most people. Times have changed, but people remain stuck in the thinking that
owning a house is wonderful, profitable, always a good idea, etc. Many houses
that sell for substantial amounts even now may be basically worthless in 10 or
15 more years, for the above reasons.
B.
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Patrick says
It's fine now. Thanks.
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What a joke. :-)
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Scam, what do you think about purchasing land and building your dream house the way you like it?
Is it also a bad investment?
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KILLERJANE says
Depends on what interest rates are really. From firsthand recent experience I can tell you that with todays interest rates, putting an additional 50k down on a home barely makes a noticeable difference in overall payments.
But besides the point, if you're about to buy a house, in my opinion you should already have a sizable amount of not only cash, but retirement savings as well.
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I didn't misrepresent anything. If you feel the need to accuse, then prove it. Quote me as saying that people should buy because they'll make tons of money.
I'm guessing you've had some bad experiences with housing in the past. Don't take it out on others, and learn some civility while you're at it. Clearly the "Insult Another User, Get Suspended" rule is only for a select few. Use your loose leash wisely for a change...
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You can pay 200,000 cash or 350,000 over thirty long years, said the king to the peasant. I prefer to be the king at a young age.
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Corning, NY
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Patrick says
I can see the feature in some threads, but not others. Weird.
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Madison, WI
For me, one income, not a good idea, in my state, property taxes change the dynamic for me. But, lol, someone did just call and ask about the house I'm selling, and the first question they asked was how much are the property taxes, and they are about $3000/yr. for a 900 sq. foot home.
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Corning, NY
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KILLERJANE says
Like you, I don't like paying interest. It's money down the drain. But so is rent.
The rent vs. buy decision ultimately comes down to minimizing the "money down the drain." You could call it minimizing the "crapper index."
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“You can pay 200,000 cash or 350,000 over thirty long years, said the king to the peasant. I prefer to be the king at a young age.” CHACHING you said a mouthful there lady jane, also you would be the queen no??? Any way, you know that if you don’t pay over thirty years you’re going to stiff the banker out of a lot of interest? That’s not very nice. They got your back, they have all the useless old people’s money and they pay them .3% interest so they have to eat cat food meanwhilst they loan it out at 10, 20, 50 times that interest so we can buy houses. You have to pay your respects to such a solid scheme!!!!
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You can call me the King of England if you want, Scam. Show me the proof. What exactly am I lying about???
My wife is the cupcake. And only I get to call her that...
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Austin TX says
I wouldn't worry too much about what "Housing is a Scam" says. He/She is a notorious troll that many people have on Ignore. Scam just goes around accusing people of being lying Realtors. And he/she changes his/her name constantly in an attempt to avoid detection.
Patrick, is there a way to fix the problem of banned folks changing their names constantly?
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Shutdown, formerly Scam... I'm not a realtor, builder, banker, mobster or Genghis Kahn. I'm just a person, like you. You should remember that when you post not just here, but anywhere. If you did, perhaps you could keep the same name for more than thirty minutes.
Our brief exchange here reminds me that I have to pick up my four-year old nephew from daycare soon... Best of luck to you.
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Corning, NY
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OMG Realtors are Liars! Everyone is a liar! Everyone is lying to me all the time! It's all a conspiracy against me! I'm totally paranoid!
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Austin TX says
That's insulting to 4-year-olds. ;-)
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46 male
Menlo Park, CA
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wthrfrk80 says
Actually, if you're banned, you're banned by IP address. Name changes don't get around that.
The one guy who changes his name all the time isn't banned. In fact, the only IP addresses that are banned right now are spammers (mostly Russian for some reason), and one guy who just keeps personally insulting me every time I let him back on.
If you "ignore" a user though, he will be ignored no matter what he changes his name to.
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Shutdown... I don't believe there are too many realtors following Patrick's blog. If they are, I'd be inclined to work with them over the unfortunate situations I've had with dishonest, disinterested realtors in the past. Furthermore, nobody--as far as I can tell--is out to get you, deceive you, or profit from your future, ill-informed decisions.
You're among compassionate people here. Why don't you talk about what happened to cause you to distrust EVERYONE? And why not consider refraining from terms like "real-ta__" in the future? It's offensive on all levels...and does little to communicate your real concerns.
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Madison, WI
Why so quick to judge people? He said he was not a realtor, his exchanges seemed fair, balanced, and honest. He even said home prices are going to decline going forward.
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With all due (and not so due) respect... this is about you. Otherwise, I'd likely be engaging someone with a legitimate argument or concern, or talking about things like when rates will go back up, what that may do to home values, shadow inventories, etc... Instead, I'm addressing one person with two screen names about phantom misrepresentations you have yet to clarify.
I'll admit at first your comments, insults and name calling angered me, but now I find them sad. Somewhere in your medicine cabinet is a bottle with more pills than it ought to have. I suggest you log out and locate it.
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Patrick says
.. so why isn't he banned? Every other post seems like he's insulting another user.
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Ignore works nice
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46 male
Menlo Park, CA
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zesta says
Yes, he's annoying. I have a hard time banning anyone though (except spammers - I absolutely LOVE banning them).
Why not use the ignore feature, or dislike his comments?
I'm going to have some anti-troll feature which lets you filter by dislike/like ratio soon.
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I think voluntary, low-tech "ignore" works wonders. It's just that new commenters like me will experience a learning curve to identify those for whom low-tech ignore is the only option. It's not in my nature to ignore people--online or in real life. Anything "automated" that might mitigate this necessity would only enhance the social media thing you've got going on here.
Until then, I'll try to expedite the learning curve. :-)
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Belgium, WI
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I guess it just gets confusing to read the comments when you Ignore someone. It's like everyone is talking about a ghost response that you can't see. That's why it's hard to choose that option in the thread.
Oh well.. (click), and the silence is deafening.
Back to your regularly scheduled marketing.
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Patrick says
Everytime I post I see the disclaimer: "Insult Another User, Get Suspended" It seems pretty black and white to me.
It's not that the insults bother me, in fact I don't think I've been insulted on this board (yet). This board is excellent because there are some great users which lead to in-depth discussions and analysis. However "trolling" or insults often lead to the discussions completely derailed. I really believe the board loses some people and thoughts that would normally add to the discussion, but choose not to when they see elementary school banter.
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Alexandria, VA
Austin TX, I believe what you said as I live in DC area and witnessed few people making a fortune with real estate. They're those people who bought couple houses arround 2000~2002, sold them later arround 2005~6 with chunky profit. Boy, wasn't it crazy back in 2005, especially in arlington county? In fact, pretty much anyone who bought before 2002 in DC area still is a winner, still can sell for profit as DC housing market is still quite strong hovering at 2003 to 2006 level depending on the location. There never been a buyer's market in the better part of DC area only with an exception of late 2008 and early 2009. Unfortunately, I was piss poor back then. Not taking a ninja loan while I can is why I am still renting I guess. Renters like me in DC area lost. Rent went up, regardless of what's happening in the other part of US. DC's rent control law is laughable, and Virginia has no rent control.
That's what DC area is about, but I bet people in better part of SF and NY had seen similar stuff. Others may think differently.
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Portland, OR
If you have the skills buying a house to remodel is like picking up a second job. The truth is that wealth is often created by working more hours. remodeling is a bitch but you are your own boss and can control the hours. If you do a buy/rent calculation and it comes out as a push but you sincerely have skills with tools, I say buy and kiss all your other hobbies goodbye.
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Austin TX says
Don't waste your energy. He's clearly on a wind up. "ALL finished items depreciate ALWAYS." Of course they do. You just need to look at paintings by Monet, Renoir, Van Gogh... to see how true his statement is. I would love to be suffering the 'depreciation' that STL envisages would have inevitably occurred from say my great grandfather purchasing a Cézanne in the 1890s.
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Bigsby says
Unless you house was built by a Frank Lloyd Wright, it depreciates absent inflationary economic policies that push unbacked money and credit through the system to interest sensitive assets, along with other house-ownership coddling policies that short-circuit the market's natural pricing self-governance. Just like most art on the walls of most all households is worth a fraction of what they paid.
Same for a car, unless it's a rare 57 chevy, or a RR, or something of high collector demand. ETC.
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seaside says
I saw the same thing happening.
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Leopold B Scotch says
And who's arguing with that? But, and it's a rather big but, that is not what STL said. He can make his points in a reasoned and informed way like you do or he can do what he's been doing so far. It's his choice, though I'm pretty sure I know which path he's going to (continue to) take.
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San Diego, CA
edvard2 says
edvard2 says
I think we have some "similar thought". The idea is to have lots of savings first, then buy a house. When you have more than enough cash to pay for house, you can choose to pay a portion of the price in cash, the rest in loans. But you know you have enough cash available to wipe it clean if you choose to.
Eventually, a paid for house relieve you from financial stress, and you can go about your life peacefully.
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@edvard and the like of savings, retirement funds
Cash? What? It is just paper! Fiat. The country has major problems. Cash is paper with only the value we and the rest of the planet value it at. Recently I have read of other countries trading for oil in a basket of other currencies.
I would rather have clean water, food, shelter.
Cash? Think about what that really is.
What happened to the retirement funds 3, 4 years ago cAn happen again. I talk to some retirees who work at home depot because of a loss of retirement funds.
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KILLERJANE says
It's what you must get AFTER money, but BEFORE ho's...
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Ho's? They won't accept your cash if it only is worth the paper it's printed on, better head to mcDs for a BIG MAC barter, IMHO.
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Troll Hunter says
Have you found yourself yet?
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Austin TX says
Awe, you guessed right. Why are you calling his bluff? He got wiped out during this downturn. It was all the realtor's fault. Actually, it was the appraiser's fault. No, no, it was the bank's fault for giving him the loans, or was it the government's fault for guaranteeing the loans?
Now it's his boss's fault for laying him off, and it is his girlfriend's fault for dumping him. He's lying at home all bored so he decided to troll Patrick.net.
You're smart for figuring it out early. This board is fun and has a lot of good contributors both bulls & bears. Don't let some trolling individuals get in the way. Welcome aboard. :)
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Troll Hunter says
Put your glasses on. It might help.
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Austin TX says
Thank you for the craving. One which will forever go unfulfilled. Well, unless I make the cupcake myself with honey and all organic, fair trade, gluten free, non-GMO, kosher ingredients.
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Tarzana, CA
Fraud. Fraud. Fraud.
I just don't believe anyone would be this tear down property for $333,000, it was even first listed at $232,000. There is even a post on this site somewhere.
Well, the comps are higher. Multi Bids!
http://www.redfin.com/CA/Encino/17840-Collins-St-91316/home/4088644?utm_medium=email&utm_source=myredfin&utm_campaign=listings_update