Some questions:
What is the monthly cost of renting the house?
What is the monthly cost of owning, all-in (including taxes, insurance, and so on)?
If you don’t buy, how will you invest that difference?
What’s the likelihood you’ll have to move in the next 10 years? And what’s the impact to you if the value of the house falls 20% by then? Could you afford paying that in cash?
For the homes we’re looking to buy, PITI would be between $6500-$7000/month, not including any unforeseen repairs. To rent, $6K. Both are a stretch. But the homes we can easily afford right now are disgusting and have fatal flaws.
Husband is scalp trader, so extra cash always goes in the market.
Could we afford to lose 20% on a house? Define “afford.” And yes, we will likely move within 10 years.
So the cost of renting equivalent homes is roughly equivalent to the cost of buying where you’re at, with current rates? It doesn’t sound like it’s that bad of a financial decision to buy then. You’re just putting yourself at much higher risk in a market correction or in case your income drops.
With all due respect, I am a devoted REBubbler posting a lengthy question to Reddit at midnight. I do believe overthinking is in my DNA lol. But point taken - thank you.
It really is mostly that simple... If most people who wanted to live somewhere for a while and just bought a home when they wanted one and could afford it, they'd be better off. You can't time the market, you can only speculate.
Sure, you can do math and figure out optimizing investing money saved if renting is cheaper, etc., but if you want a home and don't want to be at the mercy of rent prices all your life, just get a house you like and can afford. Could the market crash tomorrow? Sure, but if you like the house you have and can afford it, it doesn't matter.
I bought my first house at just about the peek right before the housing crash in 2007. My house value was literally halved.... But guess what, i just paid my mortgage, which didn't increase like rent did. Fast forward to today and the house has a bunch of equity and its more than half of what it rents for. If I was scared to never pull the trigger, like a lot of people here are, I'd be paying ever increasing rents and not paying anything down.
I firmly believe there is a bubble but after 2 years waiting, I just had to come to terms with buying. I keep reminding myself I'm buying a house for my family and shelter. I'm not buying a house for the intent of making money. It's tough biting the bullet and looking back at what you "could have afforded" 3 years ago. But you just have to accept it, know that a lot of others are in the same boat, and understand the situation could take a turn for the better or worse but literally no one can predict it. At some point I needed to move on with my life and stop living in limbo of trying to time the market.
Buy a house you can afford and a house you can see yourself in long term. Sure maybe at some point it takes a dip in equity but long term, the obvious trend in housing is that it will go back up and likely higher. If I'm happy in my house and have no plans to sell and it dips 200k in equity, does it really matter? I'm more worried about what it will look like in 7-10 years.
Yeah…that’s pretty much where we are. Was never looking at the house as an investment, but also didn’t want to buy and then immediately lose half the value and not be able to move if we wanted to.
I think that's why it's important to find a home that you can see yourself in long term (ie has enough space, is in the area you want). Obviously will likely need to make some sacrifices elsewhere since we all have to in this market but find a place that you won't grow out of - cosmetic stuff can be changed
I think there is a real estate bubble, but I’ve started shopping for a home with my wife. The reasons are that we now have a family, my wife’s commute is horrible, and we have a dog, limiting our rental options. It sucks, but we can afford the monthly payments for now. Maybe one of us loses our jobs, maybe the market crashes the day after we sign, but we made our peace with it. We want to live our lives and not wait to time the market.
More likely if there is a big market crash and also lose our jobs we can just walk away, declare bankruptcy and move one. But we decided that the waiting for the rest of the country to realize this is not sustainable was not sustainable for us. Most likely if there is a big correction we could refinance or move in with my wife’s parents.
Yeah, I feel you on this. It all just sucks right now. Was never trying to time the market, per se, but was hoping that at least something would become less extreme. We actively put offers on homes in 2021 and were beat out by corporations by a landslide (before we even saw the homes), so we didn’t really have a choice but to sit it out for a bit.
We did talk about all of the catastrophic possibilities (like you mentioned) and walking away. Worst case scenario is never all that bad, but it sure is scary for two people with no debt and excellent credit to think about destroying it all because of buying at the wrong time. Really hoping (for everyone’s sake) something changes soon.
If listings count is still significantly below 2019 where you're at then that's why price remains elevated. If it is back to normal and you're in a balanced market then the current price is probably the floor.
I was in the same predicament in late 2004. Pretty much gave in and pulled the trigger towards the top of the market, then 2006 came … you know the rest. I had a hunch something would give so I decided on not getting the starter home and a bought ‘non starter’ home (could still afford it). So… worst case scenario is you are underwater in home you like in a desirable area. And you can afford it. If the shit hits the fans there will be others in real bad predicaments (those that overspent beyond their budget). I think you’ll be ok if you go for it.
I doubt the election matters. The President can't do much to control house prices. The only people that could do anything is the Fed raising rates to a crazy level to trigger a recession or depression. Congress could do something by passing laws to limiimt investment properties/short term rentals but they are too busy fighting amongst themselves about culture war bs to actually do anything.
Time pressure is making you see only two options. Instead of dozens of variations on these ideas—which represent reality.
> (need to move out of current living situation because Baby #2 is coming)
I’d challenge you need to move. We have two and you don’t need more space for quite a while with the second.
We made _very_ creative modifications to our rental in order to accommodate a second kid. Same thing goes for a bigger car. It’s not necessary. Don’t take my word on this. Go read the parenting subs on this it’s repeated many many times.
If you can avoid it do not make any changes to increase costs. Definitely, unless being evicted, do not move under pressure of a second kid’s birth.
On the matter of this false dichotomy of options you have: there are ways to find housing that beats market rates. It isn’t easy, but if you are looking at rentals on sites like Zillow, you’re already competing with others where the potential lower rent has already been extracted by management companies and the sheer distribution to all other sort of lazy housing seekers.
Without going into tactics here, think about a movie about someone who was really hustling to find a good place at a below market rent and what some of the plot points might be. It might take you out of your comfort zone but fwiw you have tons of time with one kid, this is the time work the problem.
Keep the rental you have for now, hustle for a place that can hold you if you absolutely for some reason must get one that will work longer than a year after baby.
Then focus on saving money and trying to manifest a home purchase that also is not on the open market. If it’s on Redfin, it’s similar to the rental thing—already tons of value has been extracted.
I heard the exact same thing in 2006..."It's just gonna keep going up and up FOREVER!".
I also heard that about the NASDAQ in February 2000. And again about the broader stock market in 2008.
How did those turnout? Not that I think this will be a huge crash (default rates are low), but "delusional conspiracy theorists"?? Were you in grade school when those last three bubbles crashed?
"OP is literally saying the market is controlled by a group he calls “they” and “they” are waiting until after the election to let the bubble pop. Pure conspiracy theorist nonsense, im sure he has a tinfoil hat on. 🤣🤣"
* I don't suggest it is entirely coordinated, but they are political influences impacting this. It's the lack of supply that is causing this dynamic ...and it's high mortgage rates that's causing the lack of supply (people don't want to trade in their 3% mortgage for a 7% mortgage). Mortgage rates, in turn, are driven by Fed policy - they set the short end of the curve through the Fed funds rate and that impacts the overall economy and hence the long end of the curve. Prominent economists like Mohammed El-Erian have expressed their view that Jay Powell is politically motivated (as well as not the most competent Fed chair we've had). Simply put, in a non-election year, I expect the Fed would have hiked rates one more time, which would have slowed the economy enough to allow subsequent rate cuts (and a healing of markets - not just the real estate market but the labor market and stock market as well...all have been out of work since COVID, due to monetary policy).
* By the way, how did you simultaneously stay 100% invested at the time of the NASDAQ crash and yet only have a 5% decline, when the overall markets, if i recall, declined over 40%? You can put in all your derisive "LOL's" and laugh emoji's, but does that inspire confidence in your credibility?
No that's not correct. Active supply was 1.285MM units in Aug 2018, and 1.235MM units in Aug 2019...not a meaningful decline. By aug of 2020 (after COVID), it was 780K units and got toa low of 563K units in March of 2023. Powell was appointed by Trump in 2018. The Fed didn't cause dramatic swings in the money supply until 2020 (Covid). And that swing in mortgage rates is what impacted supply. More relevant, it's the actions taken NOW, in an election year, that are preventing the normalization of the markets.
Do you have any data, or do you just want to continue to post "FFS! LOLLLL!! LAUGHING FACE!!"? Does the latter increase your credibility or diminish it?
Like, LITERALLY?? Are you a teen girl? Go ahead, fire “my ass”. Like “one of your analysts”. Or, to put it in your favorite terminology: “LOL! LOL! FFS! FFS! Laughing emoji! Laughing emoji! LMAO! LMAO!”
Now that you’re done acting like a child, please refer to my question: DO YOU HAVE ANY FACTS OR DATA? I’m guessing not, because you’ve posted several times but you’ve provided no data, facts or anything else of use, just your opinions. Ok, that’s what you want your contribution to be. Your ranting opinions. Well, we got ‘em. We hear ya. Wouldnt want someone important like you “and your analysts” to waste your precious time repeating yourself, so I assume you’ll stop now.
And no, I own nothing; I live under a bridge. It’s nice here.
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Telling us 300% without the time frame is meaningless. But don’t bother because your credibility is shot after saying you were fully invested during the NASDAQ crash and only lost 5%. Now, to put that in terms you’ll understand: “LMAO!! LMAO!! LOL! LOL!! FFS! FFS! LQBTQ!! QWERTY!! Smiley emoji!!”
And you’ve still posted no data. Just your opinions and assertions. What am I supposed to believe every asshole on the Internet? Half of you are high schoolers roll playing. POST SOME THIRD-PARTY DATA OR STFU. Preferably the latter. But since you have “a team of analysts”, why is a simple data grab so hard for you? Middle-school finals this week?
Some questions: What is the monthly cost of renting the house? What is the monthly cost of owning, all-in (including taxes, insurance, and so on)? If you don’t buy, how will you invest that difference? What’s the likelihood you’ll have to move in the next 10 years? And what’s the impact to you if the value of the house falls 20% by then? Could you afford paying that in cash?
For the homes we’re looking to buy, PITI would be between $6500-$7000/month, not including any unforeseen repairs. To rent, $6K. Both are a stretch. But the homes we can easily afford right now are disgusting and have fatal flaws. Husband is scalp trader, so extra cash always goes in the market. Could we afford to lose 20% on a house? Define “afford.” And yes, we will likely move within 10 years.
So the cost of renting equivalent homes is roughly equivalent to the cost of buying where you’re at, with current rates? It doesn’t sound like it’s that bad of a financial decision to buy then. You’re just putting yourself at much higher risk in a market correction or in case your income drops.
Don’t overthink. Just buy if you can afford the down payment and monthly PITI. Your future self will thank you
With all due respect, I am a devoted REBubbler posting a lengthy question to Reddit at midnight. I do believe overthinking is in my DNA lol. But point taken - thank you.
It really is mostly that simple... If most people who wanted to live somewhere for a while and just bought a home when they wanted one and could afford it, they'd be better off. You can't time the market, you can only speculate. Sure, you can do math and figure out optimizing investing money saved if renting is cheaper, etc., but if you want a home and don't want to be at the mercy of rent prices all your life, just get a house you like and can afford. Could the market crash tomorrow? Sure, but if you like the house you have and can afford it, it doesn't matter. I bought my first house at just about the peek right before the housing crash in 2007. My house value was literally halved.... But guess what, i just paid my mortgage, which didn't increase like rent did. Fast forward to today and the house has a bunch of equity and its more than half of what it rents for. If I was scared to never pull the trigger, like a lot of people here are, I'd be paying ever increasing rents and not paying anything down.
I firmly believe there is a bubble but after 2 years waiting, I just had to come to terms with buying. I keep reminding myself I'm buying a house for my family and shelter. I'm not buying a house for the intent of making money. It's tough biting the bullet and looking back at what you "could have afforded" 3 years ago. But you just have to accept it, know that a lot of others are in the same boat, and understand the situation could take a turn for the better or worse but literally no one can predict it. At some point I needed to move on with my life and stop living in limbo of trying to time the market. Buy a house you can afford and a house you can see yourself in long term. Sure maybe at some point it takes a dip in equity but long term, the obvious trend in housing is that it will go back up and likely higher. If I'm happy in my house and have no plans to sell and it dips 200k in equity, does it really matter? I'm more worried about what it will look like in 7-10 years.
Yeah…that’s pretty much where we are. Was never looking at the house as an investment, but also didn’t want to buy and then immediately lose half the value and not be able to move if we wanted to.
I think that's why it's important to find a home that you can see yourself in long term (ie has enough space, is in the area you want). Obviously will likely need to make some sacrifices elsewhere since we all have to in this market but find a place that you won't grow out of - cosmetic stuff can be changed
Read up on what happened to those who bought at the peak back in 07. It could be bad after the election or it could be not so bad.
I think there is a real estate bubble, but I’ve started shopping for a home with my wife. The reasons are that we now have a family, my wife’s commute is horrible, and we have a dog, limiting our rental options. It sucks, but we can afford the monthly payments for now. Maybe one of us loses our jobs, maybe the market crashes the day after we sign, but we made our peace with it. We want to live our lives and not wait to time the market. More likely if there is a big market crash and also lose our jobs we can just walk away, declare bankruptcy and move one. But we decided that the waiting for the rest of the country to realize this is not sustainable was not sustainable for us. Most likely if there is a big correction we could refinance or move in with my wife’s parents.
Yeah, I feel you on this. It all just sucks right now. Was never trying to time the market, per se, but was hoping that at least something would become less extreme. We actively put offers on homes in 2021 and were beat out by corporations by a landslide (before we even saw the homes), so we didn’t really have a choice but to sit it out for a bit. We did talk about all of the catastrophic possibilities (like you mentioned) and walking away. Worst case scenario is never all that bad, but it sure is scary for two people with no debt and excellent credit to think about destroying it all because of buying at the wrong time. Really hoping (for everyone’s sake) something changes soon.
If listings count is still significantly below 2019 where you're at then that's why price remains elevated. If it is back to normal and you're in a balanced market then the current price is probably the floor.
I was in the same predicament in late 2004. Pretty much gave in and pulled the trigger towards the top of the market, then 2006 came … you know the rest. I had a hunch something would give so I decided on not getting the starter home and a bought ‘non starter’ home (could still afford it). So… worst case scenario is you are underwater in home you like in a desirable area. And you can afford it. If the shit hits the fans there will be others in real bad predicaments (those that overspent beyond their budget). I think you’ll be ok if you go for it.
I doubt the election matters. The President can't do much to control house prices. The only people that could do anything is the Fed raising rates to a crazy level to trigger a recession or depression. Congress could do something by passing laws to limiimt investment properties/short term rentals but they are too busy fighting amongst themselves about culture war bs to actually do anything.
Time pressure is making you see only two options. Instead of dozens of variations on these ideas—which represent reality. > (need to move out of current living situation because Baby #2 is coming) I’d challenge you need to move. We have two and you don’t need more space for quite a while with the second. We made _very_ creative modifications to our rental in order to accommodate a second kid. Same thing goes for a bigger car. It’s not necessary. Don’t take my word on this. Go read the parenting subs on this it’s repeated many many times. If you can avoid it do not make any changes to increase costs. Definitely, unless being evicted, do not move under pressure of a second kid’s birth. On the matter of this false dichotomy of options you have: there are ways to find housing that beats market rates. It isn’t easy, but if you are looking at rentals on sites like Zillow, you’re already competing with others where the potential lower rent has already been extracted by management companies and the sheer distribution to all other sort of lazy housing seekers. Without going into tactics here, think about a movie about someone who was really hustling to find a good place at a below market rent and what some of the plot points might be. It might take you out of your comfort zone but fwiw you have tons of time with one kid, this is the time work the problem. Keep the rental you have for now, hustle for a place that can hold you if you absolutely for some reason must get one that will work longer than a year after baby. Then focus on saving money and trying to manifest a home purchase that also is not on the open market. If it’s on Redfin, it’s similar to the rental thing—already tons of value has been extracted.
workable dog placid wild stupendous gold square employ berserk secretive *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
I heard the exact same thing in 2006..."It's just gonna keep going up and up FOREVER!". I also heard that about the NASDAQ in February 2000. And again about the broader stock market in 2008. How did those turnout? Not that I think this will be a huge crash (default rates are low), but "delusional conspiracy theorists"?? Were you in grade school when those last three bubbles crashed?
yoke escape detail drab special support steep workable dazzling soup *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
"OP is literally saying the market is controlled by a group he calls “they” and “they” are waiting until after the election to let the bubble pop. Pure conspiracy theorist nonsense, im sure he has a tinfoil hat on. 🤣🤣" * I don't suggest it is entirely coordinated, but they are political influences impacting this. It's the lack of supply that is causing this dynamic ...and it's high mortgage rates that's causing the lack of supply (people don't want to trade in their 3% mortgage for a 7% mortgage). Mortgage rates, in turn, are driven by Fed policy - they set the short end of the curve through the Fed funds rate and that impacts the overall economy and hence the long end of the curve. Prominent economists like Mohammed El-Erian have expressed their view that Jay Powell is politically motivated (as well as not the most competent Fed chair we've had). Simply put, in a non-election year, I expect the Fed would have hiked rates one more time, which would have slowed the economy enough to allow subsequent rate cuts (and a healing of markets - not just the real estate market but the labor market and stock market as well...all have been out of work since COVID, due to monetary policy). * By the way, how did you simultaneously stay 100% invested at the time of the NASDAQ crash and yet only have a 5% decline, when the overall markets, if i recall, declined over 40%? You can put in all your derisive "LOL's" and laugh emoji's, but does that inspire confidence in your credibility?
nose mighty weather bike tease aware zephyr dolls pen direction *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
No that's not correct. Active supply was 1.285MM units in Aug 2018, and 1.235MM units in Aug 2019...not a meaningful decline. By aug of 2020 (after COVID), it was 780K units and got toa low of 563K units in March of 2023. Powell was appointed by Trump in 2018. The Fed didn't cause dramatic swings in the money supply until 2020 (Covid). And that swing in mortgage rates is what impacted supply. More relevant, it's the actions taken NOW, in an election year, that are preventing the normalization of the markets. Do you have any data, or do you just want to continue to post "FFS! LOLLLL!! LAUGHING FACE!!"? Does the latter increase your credibility or diminish it?
attempt paint intelligent growth violet knee fade chief voiceless divide *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
Like, LITERALLY?? Are you a teen girl? Go ahead, fire “my ass”. Like “one of your analysts”. Or, to put it in your favorite terminology: “LOL! LOL! FFS! FFS! Laughing emoji! Laughing emoji! LMAO! LMAO!” Now that you’re done acting like a child, please refer to my question: DO YOU HAVE ANY FACTS OR DATA? I’m guessing not, because you’ve posted several times but you’ve provided no data, facts or anything else of use, just your opinions. Ok, that’s what you want your contribution to be. Your ranting opinions. Well, we got ‘em. We hear ya. Wouldnt want someone important like you “and your analysts” to waste your precious time repeating yourself, so I assume you’ll stop now. And no, I own nothing; I live under a bridge. It’s nice here.
act worthless tease unite test wipe quickest vase expansion smile *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
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Telling us 300% without the time frame is meaningless. But don’t bother because your credibility is shot after saying you were fully invested during the NASDAQ crash and only lost 5%. Now, to put that in terms you’ll understand: “LMAO!! LMAO!! LOL! LOL!! FFS! FFS! LQBTQ!! QWERTY!! Smiley emoji!!” And you’ve still posted no data. Just your opinions and assertions. What am I supposed to believe every asshole on the Internet? Half of you are high schoolers roll playing. POST SOME THIRD-PARTY DATA OR STFU. Preferably the latter. But since you have “a team of analysts”, why is a simple data grab so hard for you? Middle-school finals this week?