Subaru Impreza GC8 & RS Forum & Community banner

1 - 13 of 13 Posts

·
Premium Member
Joined
·
679 Posts
Discussion Starter #1
I may get flamed for this... but I think the answer is:

Wait.

Since we have trillions in national debt and we have to pay it sooner or later, I think (with my limited understanding of economics and real estate) the only thing we can do is inflate our way out of it.

Provided that the wages and salaries stay ahead of inflation (even if it goes up to 15-20%) and that real estate prices stay flat with strict mortgage lending rules, people who are currently priced out can price themselves back in if they sit tight and wait, save up, and hunker down under the storm of inflation.

Otherwise, the status quo will not help people price themselves back into the real estate market UNLESS wages and salaries go up. But wages and salaries are not gonna go up unless they are required to stay ahead of inflation. And inflation now is super-low, so paychecks have no incentive to get bigger on their own.

So the only way I see myself getting priced back into the market is a several years of inflation in the 15% range - PROVIDED that my salaries keep up with the inflation and real estate prices stay flat.
 

·
Banned
Joined
·
1,359 Posts
This is exactly my plan... then again, the housing market in Michigan is the worst in the nation, and is not expected in all honesty to recover any time soon if at all.
As well, gives me time to save up monies for a nice down payment.

Its times like these that make you sit back and wonder how they were ever able to ask as much as they did..prices are so unethically overinflated right now. It's sickening.
 

·
Premium Member
Joined
·
12,694 Posts
Drakuun said:
This is exactly my plan... then again, the housing market in Michigan is the worst in the nation, and is not expected in all honesty to recover any time soon if at all.
As well, gives me time to save up monies for a nice down payment.

Its times like these that make you sit back and wonder how they were ever able to ask as much as they did..prices are so unethically overinflated right now. It's sickening.
Are you fucking serious???

Have you seen the housing market in Northern VA? WORSE IN THE FUCKING NATION!!
 

·
Moderator
2001 A.W. L
Joined
·
13,249 Posts
I highly doubt that is going to work. As the population increases so does the demand for housing. Hell I do volunteer work for this program called green acres which uses state funds to buy up farmland so that they don't get developed on.

You have to lower your expectations in what you want in a house, buy a fixer upper, buy one away from the city (I commute 1.5 hours to work each way), sell it in 7 years when your ARM goes up and upgrade from there. If you wait 10 years it is just going to be that much longer before you can retire.
 

·
Banned
my00 RS BRP
Joined
·
476 Posts
Carisma said:
Are you fucking serious???

Have you seen the housing market in Northern VA? WORSE IN THE FUCKING NATION!!

Actually it is San Fran.....followed by where I live near Seattle.

900 Sq ft condos here sell on the regular in 250-300k mark :jerkit:

Needless to say I will be renting for quite sometime...although the average price to rent a 1bd 1 ba 600 sq ft apartment is $900 per month :(
 

·
Premium Member
Joined
·
679 Posts
Discussion Starter #6
Drakuun -- Sorry, I agree with Carisma on this one. Real estate prices in michigan are nothing compared to northern virginia (where I grew up). My parents lucked out on buying a house there when prices were sub-100K, but now they could sell it for a million even. Even if my parents sold the house now, they STILL won't be able to afford 50% of all the available NOVA housing, much less McLean, VA. What does that imply for single-income earners like me? Answer: fuggedaboutit! Same for SF, NYC, SD, etc.

scoobysnack -- it's a risky proposition, inflating our way out of this mess. If the wages don't keep up with the inflatioin, we're fucked with a capital F. May have to hightail it outta this country if that happens. But the population growth (projected to be ~425M by 2050) won't be as rapid as it was between 1920 and 2000... while it will be slower, it should open up demand for jobs and more competitive salaries while keeping taxes reasonable (government gets more simply due to population increase, not by increasing the tax rates). But then there's still the debt. We all eventually have to pay it. Not now because of the T-bills, but sooner or later that day will come, when the interest rates will blow up. Then all hell will break loose. Double digit inflation and interest rates will kill truly kill the real estate market, while those of us who DON'T own a house will be bystanders whose salaries will HOPEFULLY keep up with the inflation as we stick with renting. But I'm not saying it'll all be doom and gloom... just simply saying that it may get worse before it gets better.
 

·
Banned
Joined
·
1,359 Posts
You house prices may be higher, but remember, you guys actually have a functional economy in VA. They are that high because.. guess why... people are still paying that much for houses out there.

In Michigan, they are auctioning off $500,000 homes for under $100,000 because no one can afford anything in Michigan.. our economy I'm betting is far worse than any other state in the union, in fact last I saw, Michigan, Louisiana, and Mississippi were there top 3 in the nation for Most unemployment, Least desirable places to start or run a business, economic strength / growth.

Out problem up here is far worse than OMG high house prices.
 

·
Premium Member
Joined
·
679 Posts
Discussion Starter #8 (Edited)
Drakuun said:
You house prices may be higher, but remember, you guys actually have a functional economy in VA. They are that high because.. guess why... people are still paying that much for houses out there.

In Michigan, they are auctioning off $500,000 homes for under $100,000 because no one can afford anything in Michigan.. our economy I'm betting is far worse than any other state in the union, in fact last I saw, Michigan, Louisiana, and Mississippi were there top 3 in the nation for Most unemployment, Least desirable places to start or run a business, economic strength / growth.

Out problem up here is far worse than OMG high house prices.
True, your economy isn't doing well as NOVA is. But what really drove house prices up is the foolish population who try to live above their means and the mortgage lending industry gone out of control. You shouldn't pay more than 25% of your gross income on house payments (principal, interest, taxes, AND insurance COMBINED). But people here have been taking 50-60% out of their gross income to keep up with PITI-totaled mortgage payments. Completely ridiculous... and now these people are about to hang themselves with debt when the market is slowing down. Serves them fools right! They've ruined the real estate market for everybody. And cleaning up this mess is going to be painful.

Talk about materialistic consumerism gone amok to the point where nobody can afford anything anymore. Who's fault is that? The big spenders, that is.
 

·
Premium Member
Joined
·
679 Posts
Discussion Starter #9
I realize that I'm getting a bit carried away with this... so rather than grousing about this, look at the trend and what everybody else is doing... and do the opposite.

Everybody wants the american dream, a McMansion, 2 kids, and a dog. Now that the american dream is getting expensive, try going the other way.

That's what I'm gonna do... go against the trend. Save as much as possible, become a cheapskate, piss off some golddiggers, and see what happens :D
 

·
Banned
Joined
·
1,359 Posts
No, hey, I completely agree Venture.. who knows, maybe having the Big 3 crash so hard will eventually be the best thing for Michigan when the REAL housing crash starts everywhere else. Hard to say at this point. Michigan is just fucked beyond all repair.
So long as any manufacturing has a chance at being a union shop, we won't get new plants or businesses to build up here. Unfortunately, theres not nearly enough low to medium income housing here to even support new startups.. so our housing market is perpetually trapped. Many economists have predicted that Michigan may honestly never recover from it's housing bust. At the rate downtown continues to deteriorate, and the Big 3 continue bleeding $ from their arse holes it's not due to get better any time soon. Unfortunately, Nationalk averages and wages won't allow our prices to fall fast enough to met the average income of the middle class around here.

I think in the end our problem is the same as NOVA, but we arrived at it a different way, and have a far larger hole to climb out of to get there then just lowering housing prices. Thats why I thought it was 'worse' IMHO.
 

·
Banned
Joined
·
1,359 Posts
Venturer said:
I realize that I'm getting a bit carried away with this... so rather than grousing about this, look at the trend and what everybody else is doing... and do the opposite.

Everybody wants the american dream, a McMansion, 2 kids, and a dog. Now that the american dream is getting expensive, try going the other way.

That's what I'm gonna do... go against the trend. Save as much as possible, become a cheapskate, piss off some golddiggers, and see what happens :D
Agreed, although I've never been -that type- . The wife and I live very modestly, but it's still hard to make ends meet some times. I said in another thread, I'm making very nearly what I made about 5 years ago.. only difference is today, I'm paying roughly 100% more for gas and food.

We just got a old pop-up camper from a family friend... The wife jokes that now it doesn't matter what happens, we always have a home. I swear sometimes I'd rather live out of that camper than in a house and have to deal with all that crap again.
 

·
Registered
'99 2.5 RS Rally Blue Pearl
Joined
·
937 Posts
yay for nova...wait...

2 houses on my street went for over $1 million each. ground level garage (2-3 cars), and the rest of the house is strait up, 2-3 stories (i hope that made sense)

housing is so expensive...
 

·
Zantrex-3 YES!
Joined
·
15,331 Posts
Land is what is expensive and scarce located near the central business districts; this is why some opt to build up. If you want less expensive land then move away from high density areas. You will have to deal with long commute times so depending upon how you value your own time along with gas expenditures it may or may not be worth it.
 
1 - 13 of 13 Posts
Top