black dog
Free America
Yes they were, to those then that had cash to invest.
I was just turned 21, everything I had went to the 20% down.
Trudy, help me out here
- Thread starter Monello
- Start date
I was just turned 21, everything I had went to the 20% down.
My 1st JOB paid$ 2.01 hr washing pans at Southern MD Hospital in 1983.
My 2nd JOB was Working the Teamster Hiring Hall in the Fall of 1984 - $9.75 unloading Tractor Trailers until I went in the Army Dec 1984
[my FIL was a Teamster got us a hookup - my wife and I both work the same jobs]
ARMY E-3 Pay $ 800 ish bucks a month before taxes the Sep Rats and BAQ
... basically living off of less than $ 1000 bucks a month and Rent was $ 525 ....
Electricity was CHEAP in Colorado Springs $ 15 a month electric bill
yeah Millennials have it so rough ..... Smart Phones and Internet you wanted a movie you rented a VHS Tape in the 80's
My 2nd JOB was Working the Teamster Hiring Hall in the Fall of 1984 - $9.75 unloading Tractor Trailers until I went in the Army Dec 1984
[my FIL was a Teamster got us a hookup - my wife and I both work the same jobs]
ARMY E-3 Pay $ 800 ish bucks a month before taxes the Sep Rats and BAQ
... basically living off of less than $ 1000 bucks a month and Rent was $ 525 ....
Electricity was CHEAP in Colorado Springs $ 15 a month electric bill
yeah Millennials have it so rough ..... Smart Phones and Internet you wanted a movie you rented a VHS Tape in the 80's
My first job in 1963 at H L Green Company in Silver Spring, MD paid $.90/hour.
Chris0nllyn
Well-Known Member
According to the Census Bureau, the average cost of a home in 1981 was $82,500. With an interest rate of 18.45%. A monthly payment, after putting 20% down, would have been $1,019. That's the equivalent of $2,500 today, adjusting for inflation (not including property taxes, insurance, etc.)
The average cost of a home today is $322,700. If the same 18.45% rate were applied - along with a 20% down payment - the monthly cost would be $3,986. The total payments after 30 years would be about $1.43 million, with roughly $1.18 million of that going towards interest alone.
In both cases, 82% of your payments over 30 years would go towards interest.
I don't think you could argue that.
Clem72
Well-Known Member
His old what? WHAT? Don't leave us in suspense.
Maybe I'm confused, but that wasn't the argument. The difference in interest rates between 1982 and now is significant, thus now it is not as hard as it was back in 1982. A $322,700 mortgage at 3.8% for 30 years, with 20% down results in a PI payment of $1,203. which is half of that equivalence you noted above.
But today's mortgage rates are in the low single digits. Using 18+% in your example is misleading at best.
Anyhow, I think MOST people are best served by purchasing a home, 1 that they can afford, as soon as they are able. They build equity over time. Then sell and move up or down as your situation changes. Mortgage interest is still a tax deduction.
CPUSA
Well-Known Member
Chris is doing some sort of common core fantasy math...
Don't listen to Chris...
Chris0nllyn
Well-Known Member
It is significant, I'm not disputing that. It's also worth noting that no one in their right mind has stuck with those high rates. They've most certainly taken advantage of lower rates and refinanced.
What this does show is home prices have outpaced inflation. Something the millennial generation certainly has to deal with.
Clem72
Well-Known Member
I see where your going with this, but you are wrong.
I waited until I was a bit older and more financially secure to buy my first house in 1980, and it cost me 90k at 13% interest. We didn't do refinancing back then every time the rate dropped a half percent.
For perspective, on a 30 year loan at 13% you can expect to pay $268k in interest alone on that 90k house. My payment was right around $800 ($2,500 in 2019). This was the nicest home I could possibly afford on approximately 16-17k a year salary (45k-50k in 2019), and I was spending about 60% of my income before accounting for escrow (taxes+insurance) which is above normal now, but wasn't too unusual back then.
At today's interest rate (3%) to have a similar sized payment ($2500 + escrow) on a 30 year mortgage you could buy a $600k house. This, coincidentally (or not), is about 60% of the income of someone making 50k a year.
But here's the rub, Zillow says my old house (which is still in a very nice neighborhood) is currently worth around $300k. A brand new house of similar spec in that neighborhood should sell for close to the same amount $300-325k as the value is in the property (the house was modest sized, 1100 sqft).
So using my example, a buyer today of similar means who could afford to pay a similar amount, could get TWICE the house that I could in 1980.
Clem72
Well-Known Member
Your discussion progressed while I was writing my post, seems you covered very similar examples to my own. But your conclusion is backwards.
My 90k house from 1980 is worth 300k today, but someone today making the same amount can afford a 600k house. That means home prices did not outpace inflation + the difference in interest rates.
Now you mention refinancing, which I also briefly nodded to. I don't remember this being a thing until the mid 90s. I'm sure it was an option, but I never heard of anyone doing it and didn't see commercials advertising banks offering refinancing loans.
I had already sold my house, but I imagine I probably would not have refinanced for at least a decade.
But either way, it doesn't really matter. Because we were talking about how much you paid for housing "back then" vs today. And not many folks purchased their homes with cash, so they got that awful mortgage rate and paid that interest.
truby20
Fighting like a girl
If you were making $6 an hour in 1976 then that’s over $19 an hour now
You have zero idea what life is like for minimum wage folks today.
Minimum wage has never been considered a "living wage". And never should be.
truby20
Fighting like a girl
I believe the economy of our country is at a point now, after what 150 years of industrialization, that people who work 40 hours a week deserve the basics of life, even if that means they work in the service industry. We're a country of abundance and people who work deserve shelter, food, and healthcare.
black dog
Free America
Who cares what their life is, go get educated, learn a trade, get a second job, still not enough, get a third job........
Living on minimum wage,,, You ****ing silly millennial's....
black dog
Free America
If you own a home, apartment or live in grams basement, then take some folks in, and you can pay there bills..
If all the folks like you just did what you want all the rest of us to do you most likely will change your tune.......
We are a country of abundance because most of us work hard and pay way to much in taxes...
I'm ****ing tired of paying taxes to take care of folks to lazy to get a job or two and pay their own way in life.
truby20
Fighting like a girl
I don't think people need third jobs, not in the greatest country.
truby20
Fighting like a girl
You're not 'paying' for lazy folks. You're paying for corporations who don't pay anything.
black dog
Free America
So do tell, how do you think the immagrints that come here legally do so well after a few years working here?
They work 16-18 hours a day, seven days a week.
Head on down to Donut Connection on Shangri-La Dr in Lex Park and have a talk with Mr Patel and ask him how many hours and years hes been working like that to get his family ahead....
And corporations pay tax little girl, we pay ****ing tax.........