I did a 10 year IO arm at 3%. Have 8 years left. Jumbo. Don’t think I’ll be in my house in 8 years. Taking principal and investing. Have optionality in year 8, use funds to pay down. Sell or just refi and extend.
I can’t figure this out. People are throwing money around. Is everyone making $500k a year all of a sudden?
LOL…I keep wondering the same thing although the parent gifts, loan forgiveness, gov’t stimulus, stock market, etc. must be contributors. I also think spending habits/mentality have changed a lot. When I see multiple Lambos flying around my town and the local Ford dealership is selling $90K Raptors the day they hit the lot that’s when I know something is wrong. People are either blowing money they don’t have or they are simply choosing to buy expensive shit instead of investing for retirement, kids college, etc.
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Alot of people getting gift money for downpayments to lower monthly cost.
No joke, id say 1/3 of buyers are getting 30% of the total purchase price gifted
The reason wall street/bond people always miss on real estate calls is theyre rational people. The real estate market is often irrational due to being a necessity. More psychology than logic if that makes sense
OK.
If 125k is rich...I guess NJ isn't have an affordability crisis at all as claimed by some in this thread, bc a giant percentage of the state is very rich.
As of today's report unemployment is the lowest since 1969.
Millennials' average net worth more than doubled during the pandemic. Here’s what advisors say they should do next
Millennials' average net worth more than doubled during the pandemic, and real estate makes up more than one-third of their financial assets.
I guess the media keeps chanting crisis the actual numbers get lost in the shuffle.
Must be. Has to be 10k in loans and 3k and change in stimulus.
It absolutely couldn't be millennials doubling their net worth since 2020, or boomers passing their money on. Not like they're getting older and passing on at all.
Gotta be something nefarious, couldn't be 3.4% unemployment.
I guess you didn’t read the article. First of all, a net worth of $128K is a joke. Second of all, it’s clear that it’s all about spend, spend, spend. You think these folks are maxing out 401ks, 529s, etc?Millennials' average net worth more than doubled during the pandemic. Here’s what advisors say they should do next
Millennials' average net worth more than doubled during the pandemic, and real estate makes up more than one-third of their financial assets.www.cnbc.com
I guess the media keeps chanting crisis the actual numbers get lost in the shuffle.
“Millennials’ average net worth more than doubled during the pandemic, jumping to $127,793 during the first quarter of 2022.”
“However, millennials who recently bought homes may have significant debt, the report found. Nearly 63% of millennial debt is home mortgages, followed by almost 36% in consumer credit.”
Nobody said “nefarious”. Perhaps careless. My net worth was prob $128K when I was in my early 30s and I felt broke! That’s peanuts. I certainly wasn’t buying a multi-million dollar home with a jumbo mortgage, six figure sports car, etc. Instead, I basically invested every extra penny I had and lived modestly. Now I could retire in my 40s if I feel like it. Point is - millennials can’t keep up their current lifestyle/spending while at the same time meaningfully invest for the future. They’ve gone all in on homes, autos, and toys.
I tend to agree - if I wasn’t so hyper-focused on investing in stocks for years I would have pulled the trigger on a vacation home and it would probably be worth 3-4X by now and I would have enjoyed it. Not to mention at some point the Porsche dealership is going to throw me out if I don’t finally buy the Taycan.
I never understood the wisdom in busting ass through the best years of your life to retire early after them. Just never added up.
Job number is stubbornly strong. Fed really wants to see that number to weaken. I did see a chart on CNBC that the revision numbers are trending down.
Agree - and I never busted ass for the same reason you stated - I refused to sell my soul and would never give up time with my kids. It’s one of the reasons I focused so heavily on investing.
I offered to give my nephew the down payment for his house when he purchased it. He didn’t want the money but I’m sure his mom gave him money.
If you click on it on Zillow, Zillow saves it sometimes. I see homes "saved" for me that I clicked on once. I would ignore that.
To answer @T2Kplus20 life events are still happened. Renters still want to buy. Small families become large. And large, small. People still die. Divorce still happens. Job events. That's why there are many buyers.
Well, institutional investors are backing away—- actually running away from real estate:
fortune.com
Wall Street is running away from the housing market. But why?
Invitation Homes, the largest publicly traded holder of U.S. single-family properties, told investors on Tuesday that it's now a net seller of homes.
Hi uncle Dave . Hope to see you at my Memorial Day bbq.
If you’re getting your facts from these journalists, you’re sure to be wrong.Well, institutional investors are backing away—- actually running away from real estate:
Wall Street is running away from the housing market. But why?
Invitation Homes, the largest publicly traded holder of U.S. single-family properties, told investors on Tuesday that it's now a net seller of homes.
Agree - it’s more than just typical life events. There was a time when taxes impacted buying decisions too. In my town, you would have houses with $30K+ in taxes that would sit on the market forever and the spread between those prices and much smaller homes with $15K in taxes was not that huge. High taxes were a major knock against a house. Nowadays, buyers don’t seem to care. Taxes seem irrelevant in the buying equation.
Well of course they are. They need to fit the narrative of job growth
My company has been hiring big time the last few years but even that has slowed now. Looking at the numbers seems like the jobs are hospitality and food services. Things you would normally see this time of year increase (and areas that were slow coming back from the pandemic). My business hotels are mostly back to regular housekeeping and I don’t see as many signs about restaurants being understaffed.
Right, now add in the massive supply/demand problem. Even with rates pushing 7% people DGAS. That is what surprised me the most. Especially people selling with a lot of equity and rolling it into another house. They will crush any first time home buyer trying to compete with them.
For ex: I am getting a listing soon in Perth Amboy. I will sell the hell out of this house because it's in the 400k range. Seller almost has no mortgage and is going to turn around and pay cash for their next home. So when they're looking to buy a 350k home and there are FHA buyers and maybe some 20% buyers (not common in that price range) they will come in with cash, boom house gone.
Uh yeah, every millennial I know is maxing out 401s, nearly all I know got new jobs or promotions since COVID, and yeah they're not retiring tomorrow so obviously their worth is going to be lower now.
A new event is, I never have to work in the office again, so why I don't I move or buy a second home at the Shore?
That was something we didn't see as much before
Also the boomers handing off to millennials as the biggest generation in history is new.
This is not grounded in reality but rather your perception.
There is no evidence that millennials have an overspending lifestyle. It's just "kids today" fist shaking. First it was tell us go to college...we did, and then it was a recession. That made it harder to buy homes, and once we did...no the homes are too much.
Sure enough more millennials will move into investment products, and that will be bad. Rinse and repeat.
FYI - the real status of Millennials (worst of all gens). Lots of irresponsible people out there!
Nearly three-quarters of millennials are living paycheck to paycheck: report
Almost three-quarters of millennials are living paycheck to paycheck, notably higher than other generations, according to a new report. PYMNTS, which reports on financial news and data, and t…
thehill.com
Things have to and will give at some point. The current climate makes zero sense.
Me and my wife do well (nothing crazy but I would say better than a lot of our friends combined and we’ll over the average American couple). We’re in our early/mid 30s and dump a good amount into our 401Ks and live fairly conservatively.
Most of our biggest expenses are on food & drinks out, 1-2 vacations or small trips (NJ shore, short road trip)….and Rutgers tickets (football and basketball season ticket holder). I drive a 10 year old car and would love if it lasted me another 10 years.
We’re currently in a townhouse with a great rate (2.75% on a 15 year mortgage) and hoping keep it as an investment property and be in the market for a new house within the year but it feels like we can’t afford a moderate single family house that checks our criteria in the Camden County area.
Anything that we would like and can comfortable afford while still saving and living our lifestyle is still off the market within 1-3 days. The inventory of houses that we can comfortably afford and check most of our boxes is so low. Meanwhile any houses well over our range are still flying off the market.
Maybe we don’t make as much as we think we do but I have no idea how people are still spending and taking out loans for cars and houses at these prices and rates. It will catch up at some point and hopefully soon people like us who are patient and smarter with their finances can take advantage.
Me and my wife do well (nothing crazy but I would say better than a lot of our friends combined and we’ll over the average American couple). We’re in our early/mid 30s and dump a good amount into our 401Ks and live fairly conservatively.
Most of our biggest expenses are on food & drinks out, 1-2 vacations or small trips (NJ shore, short road trip)….and Rutgers tickets (football and basketball season ticket holder). I drive a 10 year old car and would love if it lasted me another 10 years.
We’re currently in a townhouse with a great rate (2.75% on a 15 year mortgage) and hoping keep it as an investment property and be in the market for a new house within the year but it feels like we can’t afford a moderate single family house that checks our criteria in the Camden County area.
Anything that we would like and can comfortable afford while still saving and living our lifestyle is still off the market within 1-3 days. The inventory of houses that we can comfortably afford and check most of our boxes is so low. Meanwhile any houses well over our range are still flying off the market.
Maybe we don’t make as much as we think we do but I have no idea how people are still spending and taking out loans for cars and houses at these prices and rates. It will catch up at some point and hopefully soon people like us who are patient and smarter with their finances can take advantage.
No chance…because I know plenty that aren’t. In fact, I know a bunch that pulled money out of 401Ks and investments to buy homes and cars although I’ll be the first to admit for some of them the timing was impeccable and they missed the market drop.
Can't do much better than that mortgage! Congrats. Perhaps many others are spending more of their monthly income on housing than you are willing to do? Perhaps you need to save more for a down payment to cut down on mortgage costs? When I got married in late 2005, we moved into a new townhouse rental to let the dust settle. When ended up there for over 2 years because that was the peak of the housing market and we needed to save for a while. By the time we bought in the summer of 2007, the local market took a 20% dump and we had much more for a down payment. Sometimes a little patience is all you need.
I hear you. My wife and I are both professionals and have done well (max out investments, stock plans, pensions, etc.), but I watch friends spend money like it doesn’t matter. Then when I hear millennials have an average savings of $11,000 I laugh. I went to an open house two weeks ago in Morris County it was $1.2M and $25K in taxes. Line was out the door and most of the people were early 30s. Ended up with over a dozen offers over asking. That’s when I said to my wife there is something very wrong here.
Something is definitely wrong these days and it’s called over leveraging. Many people have been taking advantage of a historic low interest rate environment buying/selling items that have only gone up in value(homes, watches, etc). Also wages have gone up for many people who have switched companies and a lot of the younger generation in apt to moving companies in a quicker fashion.
My parents bought a house in Naples 2yrs ago and already put in on the market for a $200k profit to turn around and buy another house. The market has yet to really see any drop due to so much equity in homes.
It’s the way people have created their net worth. Quite insane if you ask me
Lot of young directors and VP out there making big bucks. Also, inheritance money is being pass on to the next generation even before death. Why have they struggle?
I know this is just my small perspective, but most of the millennials I am related to or work with have no kids. Most are approaching 40 and if they have kids, it's just 1. A lot of the women can't have kids (due to various health reasons), but a lot just don't want them. Kids are a big expense with daycare, food/clothes, school tuition, etc., so my take is with no kids, they are able to afford more house as a result. Long term that sucks for the economy, Social Security, etc. but I will be dead by then.
This. A result of the WFH boom is people spreading out. No need to live in a shoebox close to NYC if you're only going in twice a week. That's why Sussex County is booming, Hunterdon etc. People are spreading out. But the counties close to the city the competition is worse than ever.
I just read an article about people leaving NYC and buying houses in Ridgewood, NJ for a million dollars and tearing it down to build a new house, just like Beverly Hills. My sister said that there are two houses being torn down right behind her son house in Ridgewood. I see that in Franklin Lakes all the time.
The rise of the multimillion-dollar 'knock down' house as wealthy millennials war over houses in the suburbs
Teardown buyers are paying "a premium to buy a house and to knock it down and build."
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