There is a lot of that going on…but the main problem is the availability of land. All of our rental properties are in class A neighborhoods. There is almost no multi-family housing in these areas and there is no land available.
I am genuinely worried about the future of homeownership for my kids generation. Fortunately we own enough houses where they will always have an option, but I suspect there are going to be a lot of un-related shared ownership and multi-generational ownership going forward.
Over the last few years I know quite a few young people (under 28) that have bought homes or townhomes. I know 3 young couples getting married this year and 2 of them are living with their parents to save for a home, the interest rates are killing them. One couple was ready to buy a $350,000 home but the monthly cost went up over $600 a month over the last 9 months because the interest rate doubled.
There’s land available, but not where people want to live. I think a lot people are going to have to drive further to afford a home. I know a couple landlords and they’re doing well because they can charge higher rent because of the location. One buddy has a few properties way out there but they’re near the train that goes through the northwest suburbs and into downtown Chicago.
My neighborhood is 65 years old. It’s close in to everything. But it is landlocked and there is no place to build anything new. Yet some on the city council are looking for ways to provide “affordable housing” in my town. I told people that I know all about it…I couldn’t live here until I reached a stage in life where I COULD afford to live here. They are exploring options called ADU (Alternative Dwelling Units) that people could build in their back yards and rent out…current proposals say they can do this without getting a permit from the city. They call them ADU’s but we used to call them “mother-in-law quarters”…Then these could be rented to people who want an address in my town, turning my 65 year old neighborhood into a very big apartment complex with hundreds of different landlords. We are fighting that.
But up until now, nobody seemed to give a shit that housing was appreciating at two to three times the inflation rate, and today housing is almost impossible for young couples to buy…“starter homes” are being bought by “investors” with the goal of renting them out…And since there is demand for starter homes, THOSE are unaffordable…One community over used to be THE area for “starter homes”. Today homes in need of a little “TLC” are going for over $250,000. 20 years ago they were going for $60,000 or less. Here’s one that is on the market for $230k…2 bedroom, 1 bath 1,000 sq ft…
People are pissed off because the “downtown” is seeing a ton of Apartments being built. And they all seem to be “luxury” apartments.
But…the American dream…a home of our own…to rent.
Developers build what people want and what can give them the largest return on their investment. Prime real estate costs more to buy and the property taxes will probably be higher, it might cost a little more to build luxury units but the higher rents will more than pay for it.
People who can afford to own will continue to, not everyone wants to own their own home. Personally I think homeownership is a great way for the middle class to build wealth and be part of a community.
A retired couple I know sold their long time home for over $400,000 and now rent. They invested the $400k and pay for rent with the interest and dividends earned. They have lived in 3 or 4 states over the last 6 years and like exploring different parts of the country.
Things cost what one person is willing to pay and the owner is willing to accept. There are affordable homes everywhere, but a lot of people don’t want to live in those areas.
A 15 year fixed rate mortgage would be $1,800 a month PITI or a 30 year fixed $1,500, both assuming 20% down on that home. Someone earning $65,000 a year can afford that home, that’s a couple with each earning $16 an hour or an individual earning $32 an hour.
Would you pay $230k for that house? More power to you.,
No, but I’m not the one complaining about the cost of housing. That house shows that there are affordable homes available, the problem is people expect to pay $100,000 for a 4 bedroom 3 bath home in a highly desirable area.
Here are several homes under $150,000. Someone making $50,000 a year could easily afford any of them.
So I am correct in assuming that you feel that the American dream must be shifting to being able to rent a house of our own? Because you started a thread on it.
For Fucks Sake!!
I am not even going to open your link.
We have gone down this path before and it has been proven that you don’t know what the hell you are talking about.
Bullshit. Are you saying all those houses listed on Realtor.com do not exist? Just because you wouldn’t want to live there doesn’t mean they aren’t an option to own a home.
No, I asked if this is the future of housing in America. The problem is people expect a McMansion in a top school district for $1,500 a month, those people are who the hedge funds buying up single family homes are going to rent to. People who understand economics and personal finance will continue to buy homes and build wealth.
So you are bitching about the price of housing in a thread you started. But claim I’m bitching.
Where did I bitch about the price of housing? YOU posted this-
If people want to live in a certain house in a certain neighborhood they may have to rent or they can lower their expectations and buy a home they can afford. It’s their choice.
Sitting in your 4 bedroom, 3.5 bath with 3 car garage in the burbs of Chicago, it’s pretty easy to talk about housing being affordable. And how you would have bought one of those “affordable” houses you found. I found one that I don’t think you wanted to live in if you were looking to build your wealth by owning your own home…it was in the deadliest neighrhood in Chicago. Perfect for someone looking to build their weatlth…and you’ll never have to worry about that. Here’s a mission for you - find one of those affordable houses that, in a worst case for you, you would be willing to live in.
Yes if that’s all I could afford. I started out in a crappy apartment in a great neighborhood and saved my money for a down payment on a starter home. Got married, bought that starter home, stayed 8 years and bought my current home. All of my neighbors did the same, they started in smaller less expensive homes and moved up when they could afford it just like most Americans do…except you.
You sound like a spoiled 16 year old who expects a new Corvette on his birthday but instead his parents give him the old family car, a 8 year old Toyota, then throw a temper tantrum like a 2 year old.
But you posted things in crappy neighborhoods.
Overland Park Kansas is a crappy neighborhood?
If people don’t want to buy a home in a neighborhood they think sucks they can earn more money to afford a home they do want or rent an apartment for the rest of their life. Most people I know save for a down payment on a starter home and when they could afford it moved to a better home in a better neighborhood, you and KC must have done it differently.
HE does that so he can sy HE would live there if he had to. That’s why I mention that it’s easy to say that living in an upscale neighborhood. Here’s one for him…I wonder if he’d live here. The price certainly is right.
You certainly know as much about Chicago as Bears does about Kansas City.