Do you find this purchasing pattern wasteful/unusual?

[Scarlett]

We are moving from a north suburb to a south one. One I never imagined I’d live in but, we do for our kids, right? We will still be in a same metro area. Without traffic, we are actually moving only about 35 minutes away but the reality is that it’s more like 1.5 hours away during the day.

 

The zip code we live now is very affluent. The zip code there is not at all. But the location is perfect for our circumstances. It will cut the school commute for my older son down considerably.

 

The move has some big costs for my younget son and a smaller cost for my husband but is a big net gain for the rest of us + has positives for all 7 of us. So. Trade offs.

 

 

That is great.  I mean yes, I agree, trade offs, but overall seems to be a good plan.  And I gather part of going to a less affluent area is more house for your money?  

Edited January 30, 2018 by Scarlett

[fairfarmhand]

Exactly. I’m more concerned about the situation of a cleaning lady married to a bus driver who are making about that much combined and have kids. Where do they live? Here, they are living either really far away or in housing that most people would not consider workable for a family or they might be doubled up with another family unless they can get some form of (difficult to access, long waiting list to get) rental

 

I've driven through our large city and wondered "Where do the custodians live? Where do the lunch ladies live?" Because tiny little older 2 bedroom homes are a quarter of a million dollars.

 

But I can't figure out an answer. It doesn't seem fair. Most lower income people aren't living in the city because they chose it. They're not like the upper middle class people who want the culture and parties and entertainment options. They end up here because of family ties or whatever. And then they would love to move to the suburbs and get their kids out of the inner city schools but they can't. So I don't know what they do. Many live in subsidized housing which has its own set of troubles.

[LucyStoner]

That is great. I mean yes, I agree, trade offs, but overall seems to be a good plan. And I gather part of going to a less affluent area is more house for your money?

It’s apartment to apartment/townhouse.

 

We are moving from an older building to a brand new one so that’s part of the jump in costs. The other factor is we are moving from a 3/2 to a 5/3 and naturally that is more expensive. We will have nearly 2x the square footage but right now we have my nieces sharing a 7x9 room and my sons sharing a not quite as small room and my brother is on my couch. We are on top of each other. My teenager really needs his own room and the kids all need a little more space. 3 of the 4 kids are autistic and sensory wise, it’s a lot.

 

The place we live and the place we are moving are not directly subsidized but both are made possible by a financing and tax scheme that incentivizes developers for building housing that is affordable for those at or under 40, 60 and 80% of the area median income by household size.

 

The primary considerations behind where to live were actually commute based for my son’s high school and my nieces, whose lives are centered in that area. If it was just a matter of more space, we could have moved to a similar 5 bedroom townhome a few month late ago not too far from where we are now.

Edited January 30, 2018 by LucyStoner

[Scarlett]

It’s apartment to apartment/townhouse.

 

We are moving from an older building to a brand new one so that’s part of the jump in costs. The other factor is we are moving from a 3/2 to a 5/3 and naturally that is more expensive. We will have nearly 2x the square footage but right now we have my nieces sharing a 7x9 room and my sons sharing a not quite as small room and my brother is on my couch. We are on top of each other. My teenager really needs his own room and the kids all need a little more space. 3 of the 4 kids are autistic and sensory wise, it’s a lot.

 

The place we live and the place we are moving are not directly subsidized but both are made possible by a financing and tax scheme that incentivizes developers for building housing that is affordable for those at or under 40, 60 and 80% of the area median income by household size.

 

 

It does sound like a lot.  I am not autistic and it sounds overwhelming to me.

[MotherGoose]

But not every journalist is cut out for engineering or nursing. Someone is going to walk dogs, wait tables, drive a forklift and write newspaper articles.

 

I have a friend who is a journalist. He’s now the editor of a weekly publication. He makes around what a starting teacher would, so here that’s about 45k. Yes, he could make more than he does (even with his degree) but this is what he’s good at at his kids are fed so I don’t really see an issue. He is married, and not to an engineer or a pharmacist but to a teacher. They have a small family and they get by.

And presumably he's happy with his life?

[LucyStoner]

And presumably he's happy with his life?

As happy as anyone I think. He’s got a great wife, they have one daughter and they are in the process of adopting two more kids. He’s one of our best friends. I remember some people teasing him about getting an advanced degree in journalism after an undergrad in something that would potentially earn more but it suits him.

Edited January 30, 2018 by LucyStoner

[LucyStoner]

That sounds like us with medical stuff for the two youngest. Right now it’s $55 bucks every three days in gas. Ugh. But it’s the best compromise since it’s closer for everything else we do day to day, and our new place is twenty minutes closer to medical and five minutes closer to work, so it’s a win win once we remodel and move in.

 

I’m SO looking forward to shaving fifteen miles off the Cincinnati medical commuting 😒

Yep, I am filling up every 2-3 days. I drive an older, smaller minivan. But there’s school + extracurriculars + an array of autism related appointments. And “driving†is lower than “dentist visits†on my list of activities ranked by enjoyment.

[Ausmumof3]

And that’s the kicker. Too many people, perhaps subconsciously, feel entitled to live in a particular area where there may be a mismatch of their salary to what they want to live in, or can afford. We hit that in California all the time. You wouldn’t believe the number of kids who thought they too should live in San Diego, because they were raised there and mom and dad lived there, but they had a job that paid a pittance for the actual cost of the area and refused to move. Never mind that they could have worked in their field in Los Alamos or even Colorado Springs and been able to afford more comfortable housing for the the salary that job paid that, because the index was more favorable. They complained endlessly about the local market as though they were entitled to a certain standard of living in a certain place, no matter their reality. Anchorage too had this - you can’t lose your high paying job and then refuse to move to where the work is, all while whining about how you can’t afford the high cost of living anymore but you could neeeeeever move.

 

It was genuinely weird. These people would never say they felt entitled to a certain home comfort level in a certain location, but their actions all reflected that. And then there were others who were flexible and made it work without living in mom’s 750k basement, and now a decade or two out? That group seems happier AND more successful. What I can’t figure out is if it’s a lifestyle choice thing or more of an attitude in general, than any economic reality. I’m inclined to think it is the latter - the willingness to choose situations that might be temporarily uncomfortable or unglamorous for the sake of achieving long term sustainability, stability, and success. Attitude and goals made such a difference.

 

It’s that person who could buy the granite but buys the laminate, and is happy about it. And the one who moves to the town where they know nobody because life will be better than sticking it out in an enclave where the is no work or insane costs. But it’s not even that straightforward. Because there are plenty of people with good financial luck in terms of timing who are also this person, and may jet set or live very well too. Maybe it’s just not having a scarcity mindset, no matter the situation, but choosing contentment. I don’t know... It could just be that intangible factor where a person will be happy, because they want to be, and if their circumstances are difficult they are flexible and industriousness enough to do the crazy thing to make them better.

 

 

 

The woman in this article doesn’t feel, to me, like she has this as I’m reading her story. And that’s a red flag. But there are other young adults I can think of, even living with mom and dad or broke as a joke, who I wouldn’t ‘worry’ about in terms of their long term trajectory. They’re the ones who might be poor but they aren’t broke or broken, does that make any sense?

I think for a lot of humans though it's natural to put roots down and develop a strong connection to your place. It's why historically many people seem to stay in a country and starve rather than venture to immigrate.

 

Doesn't mean that they shouldn't open their mindset to other options but it's good to also take into account the issues with moving away from your social network and family support. Historically, traditionally families have helped each other out. Now we work as nuclear families but that has impacts on postnatal health and mental health, availability of help during the rough times and other issues. Of course people can develop their own new support networks but it takes time and effort and can be quite difficult.

[LucyStoner]

I've driven through our large city and wondered "Where do the custodians live? Where do the lunch ladies live?" Because tiny little older 2 bedroom homes are a quarter of a million dollars.

 

But I can't figure out an answer. It doesn't seem fair. Most lower income people aren't living in the city because they chose it. They're not like the upper middle class people who want the culture and parties and entertainment options. They end up here because of family ties or whatever. And then they would love to move to the suburbs and get their kids out of the inner city schools but they can't. So I don't know what they do. Many live in subsidized housing which has its own set of troubles.

With interest rates where they are, two modestly paid working class folks who married each other could afford a 250k house. We could afford a $250k house one on FT income and my side hussles. A $250k house would have a lower monthly payment even factoring PITI and saving for repairs than the affordable rental we are moving too. But there are no $250k houses here. There were some at the bottom of the crash but they are gone now. Not long ago, there was a perfect house for us on the market. Working class area. Three bedrooms up and a 2 bedroom MIL in the walk out basement. So ideal for extended family living. Not fancy. Not updated. Road wasn’t even paved and the sewer isn’t coming in until later in 2018. It sold for over $500k. Regularly my friend texts me pictures of houses listed for $500k. One was literally burned up. Another was condemned. It’s a running joke between us. Edited January 30, 2018 by LucyStoner

[Rosie_0801]

I've driven through our large city and wondered "Where do the custodians live? Where do the lunch ladies live?" Because tiny little older 2 bedroom homes are a quarter of a million dollars.

 

Probably in those houses, which were affordable when they bought 30 or 40 years ago.

 

Where the next generation of lunch ladies will live, who knows?

[LucyStoner]

And that’s the kicker. Too many people, perhaps subconsciously, feel entitled to live in a particular area where there may be a mismatch of their salary to what they want to live in, or can afford. We hit that in California all the time. You wouldn’t believe the number of kids who thought they too should live in San Diego, because they were raised there and mom and dad lived there, but they had a job that paid a pittance for the actual cost of the area and refused to move. Never mind that they could have worked in their field in Los Alamos or even Colorado Springs and been able to afford more comfortable housing for the the salary that job paid that, because the index was more favorable. They complained endlessly about the local market as though they were entitled to a certain standard of living in a certain place, no matter their reality. Anchorage too had this - you can’t lose your high paying job and then refuse to move to where the work is, all while whining about how you can’t afford the high cost of living anymore but you could neeeeeever move.

 

It was genuinely weird. These people would never say they felt entitled to a certain home comfort level in a certain location, but their actions all reflected that. And then there were others who were flexible and made it work without living in mom’s 750k basement, and now a decade or two out? That group seems happier AND more successful. What I can’t figure out is if it’s a lifestyle choice thing or more of an attitude in general, than any economic reality. I’m inclined to think it is the latter - the willingness to choose situations that might be temporarily uncomfortable or unglamorous for the sake of achieving long term sustainability, stability, and success. Attitude and goals made such a difference.

 

 

Entitled to a big house walking distance from downtown? No. But I reject the idea that fulltime work shouldn’t allow most people a toehold somewhere near their entire familial support system. I don’t think that’s an unacceptable or especially unrealistic expectation.

 

Everyone scattering into their nuclear pods has high costs, not just for the family either. More people would end up needing government assistance when they are aged or infirm if not for the uncompensated care their family members may be providing. More kids end up in foster care when there is not a close stable relative nearby. More people need mental healthcare services they find hard to access when they have no local support system.

 

It’s not a morally inferior position to have roots and feel a sense of responsibility for one’s family. Nor is is morally inferior to be able to move readily. It’s just a different way of being.

 

I see far more people happily raising their kids in small apartments or atypical housing arrangements here or excitedly moving away to lower cost areas than I see of this entitled attitude that people make so much of. IME people are moving and those who can not are for the most part making the best of it.

Edited January 30, 2018 by LucyStoner

[Tsuga]

I’m 37. We got into and out of the real estate market at the wrong times. We got out due to circumsances beyond our control.

 

Even with a down payment, we need to market to decline to be able to buy here again and that time it surely won’t be in the city limits. Why? High prices, moderate income with earnings and earning potential lowered due to circumstance. When we first bought, we had two incomes and 1 preschooler. Now we have 2 special needs kids and I can’t work FT and meet their needs. We also have 3 other people living with us but let’s pretend we didn’t and we could buy a very small house.

 

A 20% downpayment on a small three bedroom fixer in a not great area with a commute is almost what a whole house costs in a lot of the places my friends are moving to.

 

I’m ok not buying a house now or even ever if that’s how it works out. But it’s absolutely not because we are frivolous.

 

My same age friends and younger friends who are engineers and doctors are buying houses that originally were priced for bus drivers and factory workers. My same age and younger friends who are teachers and journalists are not buying houses. The factory workers I know are living in rooms, not apartments. Every month another single high income family or double moderate income family we know relocates out of state.

 

We definitely considered relocating out of state but we chose to stay in this area so that our son could access the elite high school that had been his dream for a long time. Besides that factor, there is my elderly father, our extended family who we help support in different ways and the not small matter of finding autism services wherever we might move. I own our choice not to move at this time and we are considering still moving at some point after my son is done with high school.

 

That said, when people local to me who bought their homes 20 years ago want to give me homebuying advice, it usually boils down to no more avocado toast and I’m like, I’m already eating refrigerated oatmeal on the go dudes.

 

This is Seattle, London, San Francisco in a nutshell. Would have been us, but we both cut ties with previous jobs and went hard for money, so as to avoid having to leave the city entirely and move a thousand miles away from family.

 

People don't get it. 

 

It's pretty disgusting and England and America are going to get what they deserve in terms of social strife in the future. People are getting so angry out here on the coasts, so sick of "everyone who isn't an engineer doesn't deserve a home, you chose to be a teacher, suck it". 

 

I personally believe a life's work deserves a living wage and that includes housing but apparently in the United States and England that only applies to engineers and finance professionals nowadays.

 

I dare say that it's ironic that people on this forum who value knowledge of history and classical studies could be so ignorant to what is happening to the country and the fabric of our society.

 

 

 

There were some at the bottom of the crash

 

Oh Katie, didn't you get the memo? Remember the crash? That's when we were supposed to buy. If I recall correctly, we had just spent our emergency fund on having a baby without insurance because we both lost our full time positions simultaneously, my family's hours were cut, and on top of it all, we had to move for employment.

 

Why on earth didn't we buy a $250,000 house?

 

Also, what a coincidence that the houses were priced so low right when nobody had a job. I wonder why that happened. I'll have to make sure that next time there is a massive economic downturn, it doesn't affect me personally so I can cash in on misfortune. THat's what everybody should do. In fact if we all did that we wouldn't have a downturn. Problem solved!

 

Oh wait...

[fairfarmhand]

This is Seattle, London, San Francisco in a nutshell. Would have been us, but we both cut ties with previous jobs and went hard for money, so as to avoid having to leave the city entirely and move a thousand miles away from family.

 

People don't get it.

 

It's pretty disgusting and England and America are going to get what they deserve in terms of social strife in the future. People are getting so angry out here on the coasts, so sick of "everyone who isn't an engineer doesn't deserve a home, you chose to be a teacher, suck it".

 

I personally believe a life's work deserves a living wage and that includes housing but apparently in the United States and England that only applies to engineers and finance professionals nowadays.

 

I dare say that it's ironic that people on this forum who value knowledge of history and classical studies could be so ignorant to what is happening to the country and the fabric of our society.

 

 

Oh Katie, didn't you get the memo? Remember the crash? That's when we were supposed to buy. If I recall correctly, we had just spent our emergency fund on having a baby without insurance because we both lost our full time positions simultaneously, my family's hours were cut, and on top of it all, we had to move for employment.

 

Why on earth didn't we buy a $250,000 house?

 

Also, what a coincidence that the houses were priced so low right when nobody had a job. I wonder why that happened. I'll have to make sure that next time there is a massive economic downturn, it doesn't affect me personally so I can cash in on misfortune. THat's what everybody should do. In fact if we all did that we wouldn't have a downturn. Problem solved!

 

Oh wait...

So how does this get fixed?

 

Honest question, no snark

 

 

Sent from my iPhone using Tapatalk

[Rosie_0801]

So how does this get fixed?

 

Honest question, no snark

 

 

Sent from my iPhone using Tapatalk

 

Decentralising jobs, for one thing. That's easier said than done, though.

[Frances]

Zoning absolutely affects prices here too. The people who bought their SFH before the boom tend to lobby hard against higher density housing coming into their areas but when we have people moving here at a brisk clip, there’s no where for them affordable to buy unless they are of considerable means.

Exactly the same situation in my west coast state. And now condo owners are fighting against taller condos going up and blocking their views.

[Bluegoat]

And that’s the kicker. Too many people, perhaps subconsciously, feel entitled to live in a particular area where there may be a mismatch of their salary to what they want to live in, or can afford. We hit that in California all the time. You wouldn’t believe the number of kids who thought they too should live in San Diego, because they were raised there and mom and dad lived there, but they had a job that paid a pittance for the actual cost of the area and refused to move. Never mind that they could have worked in their field in Los Alamos or even Colorado Springs and been able to afford more comfortable housing for the the salary that job paid that, because the index was more favorable. They complained endlessly about the local market as though they were entitled to a certain standard of living in a certain place, no matter their reality. Anchorage too had this - you can’t lose your high paying job and then refuse to move to where the work is, all while whining about how you can’t afford the high cost of living anymore but you could neeeeeever move.

 

It was genuinely weird. These people would never say they felt entitled to a certain home comfort level in a certain location, but their actions all reflected that. And then there were others who were flexible and made it work without living in mom’s 750k basement, and now a decade or two out? That group seems happier AND more successful. What I can’t figure out is if it’s a lifestyle choice thing or more of an attitude in general, than any economic reality. I’m inclined to think it is the latter - the willingness to choose situations that might be temporarily uncomfortable or unglamorous for the sake of achieving long term sustainability, stability, and success. Attitude and goals made such a difference.

 

It’s that person who could buy the granite but buys the laminate, and is happy about it. And the one who moves to the town where they know nobody because life will be better than sticking it out in an enclave where the is no work or insane costs. But it’s not even that straightforward. Because there are plenty of people with good financial luck in terms of timing who are also this person, and may jet set or live very well too. Maybe it’s just not having a scarcity mindset, no matter the situation, but choosing contentment. I don’t know... It could just be that intangible factor where a person will be happy, because they want to be, and if their circumstances are difficult they are flexible and industriousness enough to do the crazy thing to make them better.

 

 

 

The woman in this article doesn’t feel, to me, like she has this as I’m reading her story. And that’s a red flag. But there are other young adults I can think of, even living with mom and dad or broke as a joke, who I wouldn’t ‘worry’ about in terms of their long term trajectory. They’re the ones who might be poor but they aren’t broke or broken, does that make any sense?

 

Why shouldn't people feel that they can have a decent place to live within a reasonable distance of their work?  Why shouldn't cities and towns use zoning and other tools to make sure the people who work in them can find affordable housing without a long commute?  It can be done, it has been done in the past.  Not only would it be good for individual families, it would be a more efficient use of infrastructure and be better for the environment and public health.

 

Why shouldn't people be able to live in the community or city they come from, at least when that city is clearly economically viable?  Why shouldn't we protect people's relationship to place?  Why is that a less real or important connection than having enough cash to drive up the property prices?  Again, there are already ways to accomplish this administratively.

 

We prevent people doing a number of things that make cities unlivable - building slums to house lower income workers is a good example.  But forcing them to live long commutes away from the jobs they do is not that different - it's a way to have poorly paid workers to make the city a nice place to live for rich people.  They might not go home to a slum, but they can't enjoy the benefits of the city they are working in, even the public benefits, in anything like the same way - they have to spend too much time commuting to areas without the same facilities.

Edited January 31, 2018 by Bluegoat

[LucyStoner]

So how does this get fixed?

 

Honest question, no snark

 

 

Sent from my iPhone using Tapatalk

I don’t claim to have all the answers or that any of my suggestions would singlehandly solve the issue but here are some things that would help many of the people I know.

 

*Infrastructure investments that support both density and building outwards.

 

*Restoring HUD funding to postwar era levels (as a percentage of GDP). Investing that in both rental and owner occupied housing.

 

*Quality controls on new construction so that when people buy cheaper newer homes they aren’t buying a house of cards.

 

*lower student loan interest rates. 6.8% and no way to refinance without losing access to forebearance options? WTF? Why are we profiting off of a group of students who graduated at the wrong time? And then kicking those people in the teeth by blaming them for not having the money for a house?

 

*Larger downpayment assistance programs for police officers, teachers, people who work at service non-profits and the like.

 

*Land trusts where people buy their homes with a low cost lifetime and inheritable lease on the land but the land trust as a whole owns the land all those houses stand on.

[Frances]

We aren’t missing it :). I mentioned way upthread that those inflated housing prices are often a result of restrictive zoning and land use policies. I was thinking of several cities in California and London, specifically. Vancouver has some of that too. Foreign investors are also hurting things in London, Montreal, and Vancouver. Hong Kong has struggled with the limited land for demand for years as well - I know you’re well familiar with that!

 

It’s part of what makes London a pretty city to visit but miserable to live, unfortunately. Everything is tight and expensive!

Foreign investors are also making housing affordability worse in many major US cities, especially on both coasts.

[LucyStoner]

Foreign investors are also making housing affordability worse in many major US cities, especially on both coasts.

This is true here for sure. A lot of lower priced homes were bid up by speculators, not people who will ever live in that community.

[Bluegoat]

So how does this get fixed?

 

Honest question, no snark

 

 

Sent from my iPhone using Tapatalk

 

One way is making cities, municipalities etc take a stronger hand in housing.

 

It's interesting to look at the UK and how they used to (and to some extent still do) manage social housing.  Social housing existed in many areas to make sure that people who could not afford the market prices would be able to find housing with a reasonable distance.  (And of course up until relatively recently that was based on walking as much as anything.  So - kind of like a city region size, though it would depend on the setting somewhat.)  People who worked or had family ties had a certain amount of priority.

 

A lot of this was dismantled under Thatcher, many properties were sold off to the people who lived in them - the idea being privatization is great and ownership is great.  In the long term though what it's meant is those properties became completely subject to the market, were sold on and became out of reach of the kind of people they were meant for.  And they were never replaced in terms of real numbers even as the population has gone up.

[Tsuga]

So how does this get fixed?

 

Honest question, no snark

 

 

Sent from my iPhone using Tapatalk

 

Well, first of all, not allowing speculative investment in residential real estate, for one. Real estate should be for people living there. For the multi-family zoned dwellings, of course you need commercial enterprise to do the building, but you can still ensure that it's governed. Oh no, government intervention. Many countries ban foreigners from owning property. The US and Canada do not. So, our residents have to deal with the entire world's investment bankers buying valuable property. I know my city is great because this is where international investors are buying property.

 

Another thing would be, as Rosie points out, sponsoring decentralization of labor. Right now, there is a natural gravity to migration. Where there is power there is money. Where there is money, there are people. Those people generate wealth, generating more power. By ensuring that people have transportation into cities (transport infrastructure) as well as ensuring that cities are well-governed and that we invest in long-term facilities and human capital around the country, we could create more balance of power so that Seattle would not be such a massive hub.

 

For what it's worth, even Amazon is feeling the pressure as we hit supernova level costs and growth. HQ2, bring it on! I feel sorry for whoever lives there but we need to relieve some of this pressure.

 

In other words, good governance aimed at producing the best possible conditions for society as a whole, rather than valuing capital as an outcome in and of itself.

 

I mean, this system is working just fine for those who own capital. There is literally no problem at all for them. Buy low, sell high! You can say that with glee if you don't care about the people dying even though they have full-time jobs (let's pretend only working people are worth living, because that's less of a stretch for our friends who have no problem telling teachers to commute two or three hours a day to work). We have people in tent cities dying on the streets here, because there is no affordable housing. But that's not a loss of capital. So, it's not a problem.

 

Consider it a problem and we can find a solution.

 

For people in power, this is not a problem.

Edited January 31, 2018 by Tsuga

[Caroline]

At our last county board of commissioners meeting, a proposal was made to build affordable housing for police officers, fire fighters, teachers, bus drivers, custodians in our county. I hope it works. Of course, people are already saying it can’t work—police officers don’t want to live where they work, teachers don’t want to live where they work... mind you, it’s not actual teachers or police officers saying this.

 

I don’t claim to have all the answers or that any of my suggestions would singlehandly solve the issue but here are some things that would help many of the people I know.

 

*Infrastructure investments that support both density and building outwards.

 

*Restoring HUD funding to postwar era levels (as a percentage of GDP). Investing that in both rental and owner occupied housing.

 

*Quality controls on new construction so that when people buy cheaper newer homes they aren’t buying a house of cards.

 

*lower student loan interest rates. 6.8% and no way to refinance without losing access to forebearance options? WTF? Why are we profiting off of a group of students who graduated at the wrong time? And then kicking those people in the teeth by blaming them for not having the money for a house?

 

*Larger downpayment assistance programs for police officers, teachers, people who work at service non-profits and the like.

 

*Land trusts where people buy their homes with a low cost lifetime and inheritable lease on the land but the land trust as a whole owns the land all those houses stand on.

[Bluegoat]

At our last county board of commissioners meeting, a proposal was made to build affordable housing for police officers, fire fighters, teachers, bus drivers, custodians in our county. I hope it works. Of course, people are already saying it can’t work—police officers don’t want to live where they work, teachers don’t want to live where they work... mind you, it’s not actual teachers or police officers saying this.

 

 

Yeah, it's just the well off people who buy condos who want to live where the police, teachers, and custodians work....

[Tsuga]

At our last county board of commissioners meeting, a proposal was made to build affordable housing for police officers, fire fighters, teachers, bus drivers, custodians in our county. I hope it works. Of course, people are already saying it can’t work—police officers don’t want to live where they work, teachers don’t want to live where they work... mind you, it’s not actual teachers or police officers saying this.

 

 

Well, maybe police officers don't all want to live exactly where they work.

[PeacefulChaos]

Our expectations are often formed by watching the generation before us.  I expected to buy a starter home, grow my family, sell my little house to a younger couple and move into Our Real Home, just like I saw everyone do while I was growing up. (To be fair, my parents didn't move. They had an addition put on that involved rebuilding almost our entire house.  The things equity can do!)

 

 

I know this was like, forever ago now, but this part makes me shudder.  Just because I hate moving.  By all means, I don't expect that we'll find a perfect house and never move again.  But if it came our way I'd take it.  :lol:  

 

The biggest reason to buy rather than keep renting is to stabilize your housing payment. Right now you are at the mercy of your landlord/lady. What happens if he/she decides to sell the house or move back in himself/herself? Or just raise your rent in line with market prices?

 

When we bought at the end of 2009, our mortgage was $250 more per month than the rent we had been paying. We were able to refinance to a 15 year mortgage in 2012 when rates dropped. Today rent on our old place would cost us a whopping $2k more than our mortgage. There's no way in H-E-double-hockey-sticks we could afford to pay that.

 

If you buy, you will be significantly less likely to find yourself forced to move because you can no longer afford the monthly payment. There's obviously things like unemployment or disability causing a drop in income, but in that case you'd hopefully at least get back the equity you've built up in your home. With renting, you're just building wealth for your landlord/lady.

Luckily, our landlord is not a person, exactly.  And truthfully, we do know that eventually the house we currently rent will be torn down to expand the main business that owns this property.  We've known it from the beginning.  I honestly never thought I'd be living here for 9 years, and we were very lucky to find out about this place back then. 

So yeah, I'm reluctant, but it is necessary.  And like I said, I *do* get it.  That doesn't mean I'm excited about it, but I get it.  :D

 

 

Doesn't mean that they shouldn't open their mindset to other options but it's good to also take into account the issues with moving away from your social network and family support. Historically, traditionally families have helped each other out. Now we work as nuclear families but that has impacts on postnatal health and mental health, availability of help during the rough times and other issues. Of course people can develop their own new support networks but it takes time and effort and can be quite difficult.

 

:iagree:  

[LucyStoner]

I've driven through our large city and wondered "Where do the custodians live? Where do the lunch ladies live?" Because tiny little older 2 bedroom homes are a quarter of a million dollars.

 

But I can't figure out an answer. It doesn't seem fair. Most lower income people aren't living in the city because they chose it. They're not like the upper middle class people who want the culture and parties and entertainment options. They end up here because of family ties or whatever. And then they would love to move to the suburbs and get their kids out of the inner city schools but they can't. So I don't know what they do. Many live in subsidized housing which has its own set of troubles.

I would push back on the idea that as a group lower income people don’t want the culture and amenties of city living. Sure there are costs associated and everyone is different/want different things but we have benefited tremendously from the educational, healthcare, natural, arts and social resources that we take for granted here and for most of the last 6 years we would be considered low income here and even now, not high income. On a thread here someone said that they didn’t understand why city living was attractive to families because after all how often would a family use things like arts organizations and sports and my personal answer was all the freaking time. It’s very much a different strokes for different folks situation and I get why some people don’t like it. But personally I find it easier to be on a tight budget in a metro area than I would in a small town...the parks, libraries, free and low cost opportunities to see art performances and visit museums all make us feel a lot richer than we would without them. My kids take a range of enrichment classes. I can even keep them in piano for $20 a week, a splurge but a lot cheaper than most and only possible due to community connections...our piano teacher is a close friend’s mother who cuts me a mega deal. My teen takes weekly art lessons at a big art school for free. Not because he got a scholarship or anything but because the class is free for all comers. I know a lot of people, some with much less than us, who are similarly inclined. There are certainly small towns where we could do some of this but probably not to the same extent or quality. If one is placebound, there’s definitely an upside to it being in a familiar city we love with a lot of great resources and amenities. Edited January 31, 2018 by LucyStoner

[kiwik]

Yes he did. He said it could take 4 to 8 years.

He said you could save a deposit but wouldn't get a mortgage unless she got a partner (or a massive pay rise I guess). But that is why I didn't like the NZ Dave Ramsey shows - the people were wasting more than I was earning. 1000 pounds a month is a lot of pocket money. More than many earn.

[Carrie12345]

I don’t claim to have all the answers or that any of my suggestions would singlehandly solve the issue but here are some things that would help many of the people I know.

 

*Infrastructure investments that support both density and building outwards.

 

*Restoring HUD funding to postwar era levels (as a percentage of GDP). Investing that in both rental and owner occupied housing.

 

*Quality controls on new construction so that when people buy cheaper newer homes they aren’t buying a house of cards.

 

*lower student loan interest rates. 6.8% and no way to refinance without losing access to forebearance options? WTF? Why are we profiting off of a group of students who graduated at the wrong time? And then kicking those people in the teeth by blaming them for not having the money for a house?

 

*Larger downpayment assistance programs for police officers, teachers, people who work at service non-profits and the like.

 

*Land trusts where people buy their homes with a low cost lifetime and inheritable lease on the land but the land trust as a whole owns the land all those houses stand on.

 

I would add, divorcing school tax from home ownership in many areas. 

 

Where I am, you can buy a $60,000 house or a $360,000 house in the same neighborhood, but you're looking at school tax (not property tax) in the >$3,500 zone either way. It can make that $60,000 house out of reach for some families.

 

PA is proposing raising income tax and sales tax by 1 to 1.5% instead. It's probably not a perfect solution, but it could mean amazing things for a region that, on a scale of 1 to 10, is ranked POINT FIVE for real estate market health.

[Jerico]

A 1000 left after expenses but only saves 100?

 

And she's complaining about not owning a home?

 

After mortgage, utilities, groceries, health insurance, and other expenses NO debt (other than mortgage), NO eating out, and no monthly savings (we get paid biweekly and save those extra 2 paychecks, which probably get eaten up in emergencies or taxes) we are lucky to break even. We only own a home because of the rural housing loan and can buy without a down payment.

 

Honestly I didn't finish the article. I hate when people complain about costs when they have so much wiggle room and honestly, wasteful spending. Many of us out here do without nice things and have to scrimp just to get by (not to even save).

[Tsuga]

A 1000 left after expenses but only saves 100?

 

And she's complaining about not owning a home?

 

After mortgage, utilities, groceries, health insurance, and other expenses NO debt (other than mortgage), NO eating out, and no monthly savings (we get paid biweekly and save those extra 2 paychecks, which probably get eaten up in emergencies or taxes) we are lucky to break even. We only own a home because of the rural housing loan and can buy without a down payment.

 

Honestly I didn't finish the article. I hate when people complain about costs when they have so much wiggle room and honestly, wasteful spending. Many of us out here do without nice things and have to scrimp just to get by (not to even save).

 

The tone of the article is one of self-correction and humor, not of complaint.

[scholastica]

I would add, divorcing school tax from home ownership in many areas. 

 

Where I am, you can buy a $60,000 house or a $360,000 house in the same neighborhood, but you're looking at school tax (not property tax) in the >$3,500 zone either way. It can make that $60,000 house out of reach for some families.

 

PA is proposing raising income tax and sales tax by 1 to 1.5% instead. It's probably not a perfect solution, but it could mean amazing things for a region that, on a scale of 1 to 10, is ranked POINT FIVE for real estate market health.

 

What the heck? Property taxes here are based on home value. They go to schools, libraries, fire protection, all kinds of other things. That's crazy.

[Paige]

Yes he did.  He said it could take 4 to 8 years. 

 

Which isn't really a very long time.

 

I think she's a little wasteful, but who isn't? She has probably been spending on autopilot for a while and now realizing that she's closer to 30 than 20 and wondering where the time and money went. I don't think she's unusual either- I see this a lot with my single friends- even those who are much older. I haven't been a young single adult, but it seems there's a lot of social pressure to keep up with your peers and it could be isolating to commit to frugality. Instagram and social media don't help.

 

She could cut back on some things and save more but I don't think she needs to cut back on everything. She should save because everyone hopefully gets old, but she shouldn't be miserable while she saves and waits to be old. 

[TravelingChris]

I just want to point out that this is true, but it is not as if there is no trade-off to living far from the metro area where you work.

 

There is a real, tangible, every-day-quality-of-life and quantity of life trade-off when it comes to living in a small town, and that's a commute.

 

http://time.com/9912/10-things-your-commute-does-to-your-body/

 

https://www.express.co.uk/life-style/health/703132/Commuting-bad-health-shorten-life-new-report

 

It is true that you can't live right downtown or even in a central district on a journalist's salary. And it's true that for a single young person such as the woman in this article, you can save quite a bit just moving two or three tube stations down the line. However, housing is still insanely expensive there and almost certainly out of her reach.

 

To get savings, you need to go where fewer people are willing to live. Since living in a small town is not actually that bad, ask yourself, why wouldn't people want to live there? The answer is the commute. Three or four hours out of your day, 10-20% of your life, spent on public transport or in a car.

 

It's really frustrating to see people talk about this macro and microeconomic issue that is affecting the quality of life and financial security of millions, as if it were some kind of "simple trade-off" of "oh just move further out" "oh just drink less Starbucks". People are not that stupid. They are making rational choices, and if those choices seem strange it's because you don't understand the economic environment in which they are making them.

 

They are not seeing home ownership pay off for Generation X. They are not even seeing it pay of for many Boomers. They are seeing lifetimes of sacrifice erased in a day on the stock market, and people stuck with taxes they can't even pay. These stories make the news.

 

Maybe we could have policies about speculation on residential real estate. Maybe we could spend money on better transport making living in a smaller bedroom community not so detrimental to your health. Maybe we could have opportunities for service like Americorps and Peace Corps also linked to low-downpayment low-interest loans. Maybe we could take a hard look at why salaries are not rising with inflation and think about the policies that affect how businesses spend their money. Maybe we could have a real conversation about the fact that public policy affects people's lives and most people do what makes sense for them, and if people are all opting out of the real estate market, it's because it's not a market they will do well in because only people with a lot of excess capital can stay ahead of the market.

 

Not because they buy a cup of coffee. If you read stories of the depression, people do buy coffee and donuts on the street, even when they are not getting full meals at home. Wasteful? In a sense. Irrational, i.e. worth less than that money would be worth on real estate? I'm not sure about that.

 

Finally, again, even if everyone solved this for themselves, it wouldn't make housing affordable. The only way to get ahead is having more than others. So if you can somehow scrape together a more frugal lifestyle, living with your parents, getting into a very high salary (wouldn't the world just be perfect if there were no artists, teachers, arborists, nurses, only engineers and doctors?) early, you still won't be able to afford a house.

 

Because supply and demand governs that, so if everyone saved more, the prices would just go up, because the supply is increasingly inelastic around the world, and actually in some areas, such as Bangladesh and in certain places where they are running low on water, the supply is going down.