# But seriously. Those housing prices! How do you do it?

#### Rhea

##### Cyborg with a Tiara
Staff member
I chat with my friends who live in high price housing markets and I am stumped on how this works.
Do y’all mind sharing your stories?

Take California, with their million dollar small homes. (Also NYC, Austin, Seattle, etc) How does a family afford that? Do you never take vacations? Are you able to save for retirement? Is the house the retirement? Do you ever pay off the mortgage?

I have friends with similar incomes, and they pay $4K -$5K per month for a 2-3 bedroom house, not huge and small yards (if any). That seems INSANE to me and I can’t figure out how they budget.

What’s the deal for you?

Context: I live rural and you can buy a 4BR house here with 2000sq feet and 10 acres of land for, say, $150,000 ($300K if you want it to be manager-level fancy). You can get one that needs some updating for $60,000. You can get a nice (brand new) singlewide and 2 acres to put it on for$50,000. So I am used to prices that are not higher than 1 year’s income for most professionals.

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#### bigfield

##### the baby-eater

Here's what I'm using for a bit of context:
Median household income: $78,672 Median value of homes:$538,500
Median monthly owner costs with mortgage: $2,422$4K a month alone is $48,000 a year, which to me is a staggering amount of money to pay on a mortgage. You could maybe manage that on a median CA household income, but I bet it's unusual. I'm guessing that your friends have a household income much higher than the median, and I'm guessing that there aren't many people who can afford these million dollar homes. (I've heard that some people do interest-only repayment plans, but I can't see how that is anything other than financial suicide unless you are aggressively building a real estate portfolio.) I've watched a fair bit of HGTV and the variation in house prices from one TV show to another is incredible. It looks like you can get some absolute bargains if you are willing to live outside of a big city, although it isn't at clear whether those are good places to live (and get a job) overall. #### DBT ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. #### Jimmy Higgins ##### Contributor Here's what I'm using for a bit of context: Median household income:$78,672
Median value of homes: $538,500 Median monthly owner costs with mortgage:$2,422

$4K a month alone is$48,000 a year, which to me is a staggering amount of money to pay on a mortgage. You could maybe manage that on a median CA household income, but I bet it's unusual. I'm guessing that your friends have a household income much higher than the median, and I'm guessing that there aren't many people who can afford these million dollar homes.

(I've heard that some people do interest-only repayment plans, but I can't see how that is anything other than financial suicide unless you are aggressively building a real estate portfolio.)

I've watched a fair bit of HGTV and the variation in house prices from one TV show to another is incredible. It looks like you can get some absolute bargains if you are willing to live outside of a big city, although it isn't at clear whether those are good places to live (and get a job) overall.
My understanding is living outside of LA is called "living in Phoenix".

HGTV pisses me off. Talk about ungreen. Yeah... we're taking this otherwise decent looking house apart, spending $200,000 to improve it, and then flipping it for a$100,000 gain. The amount of trash we are producing and resources we are wasting for vanity will be intense! Granite countertop, GONE! 15 year old cabinets, GONE! Hey, let's needlessly replace this door with a $12,000 door! SMASH! #### rousseau ##### Contributor For many in my generation, the answer is that you can't afford these homes, and have to put off getting married and having children indefinitely. Some of our friends still live with their parents, many have moved to outlying towns where homes are cheaper (and now face rising costs for fuel). My younger acquaintances who just finished up with school are trying to hold on to a glimmer of hope. Last edited: #### rousseau ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. #### DBT ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. They can't, but that's not what I was suggesting. #### Politesse ##### Lux Aeterna I chat with my friends who live in high price housing markets and I am stumped on how this works. Do y’all mind sharing your stories? Take California, with their million dollar small homes. (Also NYC, Austin, Seattle, etc) How does a family afford that? Do you never take vacations? Are you able to save for retirement? Is the house the retirement? Do you ever pay off the mortgage? I have friends with similar incomes, and they pay$4K -$5K per month for a 2-3 bedroom house, not huge and small yards (if any). That seems INSANE to me and I can’t figure out how they budget. What’s the deal for you? Context: I live rural and you can buy a 4BR house here with 2000sq feet and 10 acres of land for, say,$150,000 ($300K if you want it to be manager-level fancy). You can get one that needs some updating for$60,000. You can get a nice (brand new) singlewide and 2 acres to put it on for $50,000. So I am used to prices that are not higher than 1 year’s income for most professionals. I live in an apartment. #### rousseau ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. They can't, but that's not what I was suggesting. I guess what I was getting at is that economies do work for their members, but a perfect, linear idea of progress isn't entirely realistic. Maybe that's what you meant too? #### rousseau ##### Contributor I have two friends with homes around the million dollar mark. One is a doctor who makes 350k/year, the other bought before the market was hot, sold at a profit, and now owes 600k on his Toronto home. One way or another the dots have to connect. My wife and I are also in the 'bought at the right time' camp. She and her sister bought our home in 2005, and we got a good deal when buying her sister out in 2017. #### Jimmy Higgins ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. There is usually the generational whining. I tried to explain to Boomers that the stock market has exploded during their life time. College was affordable. Housing wasn't too expensive. Health care not too nutty. So yeah, you better have done well you lucky fucks! The latest generation has a stock market that just yo-yos like madness, college is through the roof expensive, health care costs continue to increase, and housing gets expensive. I feel like my generation, Late Z'er were the last ones to get out into the old world where you went to college (worked hard... well some did), graduated and got a job, and things work themselves out. I graduated, got a house in '03, and since then the Great Recession and a global pandemic. It isn't WWII, but there were blue collar jobs back then too. #### rousseau ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. There is usually the generational whining. I tried to explain to Boomers that the stock market has exploded during their life time. College was affordable. Housing wasn't too expensive. Health care not too nutty. So yeah, you better have done well you lucky fucks! The latest generation has a stock market that just yo-yos like madness, college is through the roof expensive, health care costs continue to increase, and housing gets expensive. I feel like my generation, Late Z'er were the last ones to get out into the old world where you went to college (worked hard... well some did), graduated and got a job, and things work themselves out. I graduated, got a house in '03, and since then the Great Recession and a global pandemic. It isn't WWII, but there were blue collar jobs back then too. I got very lucky as well as I finished up with school in a booming job market, and managed to become a homeowner just before prices exploded. A few years ago I thought it was a matter of making good decisions, but these days a lot of my peers are hopelessly buried. My acquaintances mostly fall into two camps: those who are making the best of it and those who play the blame game. It's genuinely awful for some, but blaming doesn't pay the credit card bill. Those getting hit the hardest are friends who rejected modern values outright and never even attempted to find a career. Living paycheque to paycheque and barely getting by. #### Elixir ##### Made in America Real estate is risky. My advice: get lucky. You can’t get lucky without facing risk, but real estate DOES appreciate on average, and the longer you can hold onto it the better your chances of ending up in the black. Right now I am facing the prospect of “losing” on a long term (15 yr) real estate deal. But it’s only a loss in terms of “today dollars” spent on the purchase plus taxes, insurance, upkeep, travel etc. AND a major remodel it will need to be marketable. Most of the purchase price was re-couped in rent over the time I’ve owned it and it would yet be profitable if I held it a few more years… and will be close to break even if I sell it this spring. Every other property I ever got into was a clear winner in the end. So I say go for it, esp if you are young and flush enough to hold for 10+ years. #### rousseau ##### Contributor Real estate is risky. My advice: get lucky. You can’t get lucky without facing risk, but real estate DOES appreciate on average, and the longer you can hold onto it the better your chances of ending up in the black. Right now I am facing the prospect of “losing” on a long term (15 yr) real estate deal. But it’s only a loss in terms of “today dollars” spent on the purchase plus taxes, insurance, upkeep, travel etc. AND a major remodel it will need to be marketable. Most of the purchase price was re-couped in rent over the time I’ve owned it and it would yet be profitable if I held it a few more years… and will be close to break even if I sell it this spring. Every other property I ever got into was a clear winner in the end. So I say go for it, esp if you are young and flush enough to hold for 10+ years. The problem for most of us is the initial down payment, and before that our student debt, and before that even finding a well paying job. I have a young cousin who's in this predicament right now. She wants to leave her boyfriend and get her own place (to rent) but is struggling to secure stable employment. Needless to say I'm already thinking about how to help our boys out with property, and one of them isn't born yet. #### bigfield ##### the baby-eater Real estate is risky. My advice: get lucky. You can’t get lucky without facing risk, but real estate DOES appreciate on average, and the longer you can hold onto it the better your chances of ending up in the black. Right now I am facing the prospect of “losing” on a long term (15 yr) real estate deal. But it’s only a loss in terms of “today dollars” spent on the purchase plus taxes, insurance, upkeep, travel etc. AND a major remodel it will need to be marketable. Most of the purchase price was re-couped in rent over the time I’ve owned it and it would yet be profitable if I held it a few more years… and will be close to break even if I sell it this spring. Every other property I ever got into was a clear winner in the end. So I say go for it, esp if you are young and flush enough to hold for 10+ years. I'm not going to get lucky then, because I can't afford risk. I have a responsibility to keep a roof over our heads, and that means buying a house I can afford to pay off, even when interest rates inevitably rise, regardless of its potential to appreciate in value. I'll stay here as long as I can, not because I care about the investment or because I particularly like this house, but because I can't afford to re-enter the housing market in the foreseeable future. Any equity I gain is purely a side-effect of having a family home. #### Jimmy Higgins ##### Contributor Real estate is risky. My advice: get lucky. You can’t get lucky without facing risk, but real estate DOES appreciate on average, and the longer you can hold onto it the better your chances of ending up in the black. Right now I am facing the prospect of “losing” on a long term (15 yr) real estate deal. But it’s only a loss in terms of “today dollars” spent on the purchase plus taxes, insurance, upkeep, travel etc. AND a major remodel it will need to be marketable. Most of the purchase price was re-couped in rent over the time I’ve owned it and it would yet be profitable if I held it a few more years… and will be close to break even if I sell it this spring. Every other property I ever got into was a clear winner in the end. So I say go for it, esp if you are young and flush enough to hold for 10+ years. I'm not going to get lucky then, because I can't afford risk. I have a responsibility to keep a roof over our heads, and that means buying a house I can afford to pay off, even when interest rates inevitably rise, regardless of its potential to appreciate in value. I'll stay here as long as I can, not because I care about the investment or because I particularly like this house, but because I can't afford to re-enter the housing market in the foreseeable future. Any equity I gain is purely a side-effect of having a family home. My Dad bought a house in the South Shore of Massachusetts in 1983. The house was sold for 5x what he bought it for in 2003. No intent of his own was he trying to make a ridiculous sale profit. Zillow thinks the house is about 1.5x its sold price today, nearly 20 years later. And oh my goodness has the front yard garden over grown! #### Elixir ##### Made in America Real estate is risky. My advice: get lucky. You can’t get lucky without facing risk, but real estate DOES appreciate on average, and the longer you can hold onto it the better your chances of ending up in the black. Right now I am facing the prospect of “losing” on a long term (15 yr) real estate deal. But it’s only a loss in terms of “today dollars” spent on the purchase plus taxes, insurance, upkeep, travel etc. AND a major remodel it will need to be marketable. Most of the purchase price was re-couped in rent over the time I’ve owned it and it would yet be profitable if I held it a few more years… and will be close to break even if I sell it this spring. Every other property I ever got into was a clear winner in the end. So I say go for it, esp if you are young and flush enough to hold for 10+ years. The problem for most of us is the initial down payment, and before that our student debt, and before that even finding a well paying job. I have a young cousin who's in this predicament right now. She wants to leave her boyfriend and get her own place (to rent) but is struggling to secure stable employment. Needless to say I'm already thinking about how to help our boys out with property, and one of them isn't born yet. The down payment thing has to be overcome by hook or crook. My first house purchase was an owner -carry situation, and the old lady who sold me the property was a real gem. She let me negotiate the down payment in favor of a five year balloon payment. That gave me time to get it together even if I was going to need a bank to help out with the balloon. As it turned out, I was able to cash her out, having scrimped and saved for five “hard years” (that were really some of the best of my life). The person who let me know about the property had been on the brink of buying it himself, until he discovered a much higher end property that he bought instead. A few years later, he was upside down on that high end property and ended up taking a big loss, while I was free and clear on a property that eventually sold (with improvements) for 20x what I paid for the initial purchase plus interest. So again… get lucky, don’t be greedy, and lower your sights as needed. Be ready to turn it over when conditions warrant, even if you don’t want to. Also be ready to hold; keep reserves to make sure you can. I like to remind myself that they’re not making any more real estate when things look iffy. That dynamic always prevails eventually! ETA the student debt thing is horrible. That is a societal abomination that needs to be made to go away. Certainly limits your options, and that sucks. Last edited: #### southernhybrid ##### Contributor My sister and her husband bought a very small house in a small town in New Jersey about 10 years ago. Their house payment is about 2500 per month. They paid about 400K for the house but they put about 200k down, money from the equity in their previous home. Their real estate taxes are about 10K per year, which is actually low for northern NJ. She told me recently, that they could get over 500K if they were to sell their home. My sister is 70 and the reason she still works is so they can pay their mortgage. Her husband is retired other than for some occasional work he does doing photos for local realtors. I know that's not nearly as high as the OP is talking about, but it's still difficult for people like my sister and her husband to afford a home like the one they have. They both collect SS so that helps too. I don't know my sister's salary, but it's probably at least in the 80K range. I guess their total income is in the 125K range. Maybe a little bit higher, but most everything is more expensive in NJ compared to most parts of the country. We paid off our mortgage about ten years ago, but it was only about 900 per month. My home is twice the size of my sister's home, has a 3/4 acre lot, a large swimming pool and it's all brick. If we were to sell it, it would still be for less than my sister paid for her tiny frame home which hasn't been updated. But, here's the thing. Even in my small southern city, home prices are rising drastically. Some of it may be due to what we commonly call Atlanta sprawl. We are also seeing many people from the northeast moving here as well, including several of my newer neighbors. A few years ago, one could buy a very nice small home on the town's most sought after street for about 120K. The same home now would be about 300K. People can probably afford these homes now due to the unusually low interest rates, but as the fed increases rates this year, these homes will become unaffordable for a lot of people or the values might decrease. I sometimes read the real estate section of the NYTImes. In New York City, a. tiny starter condo usually goes for about 6-800K. But, a lot of New Yorkers don't have cars and that is one thing that helps lower their expenses. Still, it's mostly working couples who buy real estate in New York City. I assume they make higher salaries compared to the rest of the country. I can't imagine paying so much for housing, but it's becoming more common all over the country. Condo fees are also becoming insane. I've owned two condos and our fees were never more than 250 a month. I've seen condo fees that are well over 1000 per month in places like NY City. Even the exurban areas near me are appreciating quite a bit. Plus, homes that have been updated, usually sell within a day or two, especially if they are in what is considered the best locations. But, they sell fairly quickly even in areas that were once considered less desirable. I browse homes in Indianapolis, since my son lives there and we sometimes consider relocating. Prices are rising rapidly in Indy as well, although not quite as much as they are here in Georgia. A lot of retirees are moving to my area, probably due to the climate, lower cost of living and/or this is where they have children. When people move from larger more expensive cities, it often pushes up the prices of the area where they relocate. I read yesterday that home prices in Atlanta. have risen 25% over the past year! ATL used to be considered a very affordable city, but no more due to the rise in rents and houses. I know I'm not answering the question in the OP, but as one who has always enjoyed following the real estate market, I do think the most recent increases are due to supply and demand, largely due to the very low interest rates. Demand has increased due to younger people wanting to buy their first home too. We've owned a lot of homes and while they were all affordable for us, what we could afford, always depended on the interest rates. When we lived in NC, our mortgage rate was 13%. We refinanced when rates dropped a few years later, but they were still about 9%. The last rate we had was about 4.5% after we refinanced down from a 7.5% rate. We lost money on every home we owned, other than the two homes in Florida. One was just a little vacation condo that we owned for 18 years and we lived in the other one for less than 3 years. We moved too often due to husband's job changes and that is part of the reason why we lost money on real estate. We've been in our current home for 23 years and after not increasing in value for about 20 years, it's now worth more than twice what we paid for it. Still that's not a great investment considering how long it took to get us here, as well as how much we've spent maintaining and updating it over the years. I love my house and dread the thought of moving, but it is way more than we need, so unless I die suddenly, we will probably eventually have to downsize. It's just so hard to find a replacement right now as homes are selling within days almost everywhere. I know damn well if we put the house up for sale right now, it would sell within days, possible even in a bidding war. I'd have to buy another home before we could sell this one. #### TSwizzle ##### Let's Go Brandon! Take California, with their million dollar small homes. (Also NYC, Austin, Seattle, etc) How does a family afford that? Do you never take vacations? Are you able to save for retirement? Is the house the retirement? Do you ever pay off the mortgage? What’s the deal for you? Part of California are very expensive and other parts not so much. But living in the 909 is not for the faint of heart. But it really is a bit of a mystery as to how people manage in the typical LA County home. Houses in my neighborhood are at least$900k for about 1,100sf, 3 bed home, the lot size varies. A house across the street from me is on the market at $1.2m, I'd be surprised if they get that much but it will be close. Rentals in my area for a two bedroom apartment is at least$2,800. Both my kids are resigned to leaving California even though they quite like it here. I will try to help them stay if I can.
Imagine paying $800k for a modest home plus the property tax every year, you must be sitting on boxes and eating spam six days a week. But somehow people are doing it but I really don't know how, they must have saved for a significant down payment or something. I bought my house 21 years ago for about$345k. It's almost paid off. I just need the property market to stay hot a couple more years then I will sell up and move, probably out of California.

HGTV pisses me off. Talk about ungreen. Yeah... we're taking this otherwise decent looking house apart, spending $200,000 to improve it, and then flipping it for a$100,000 gain. {snip}

Property investors are very active in LA County just now, you see their ads on TV and hear them on the radio. Parasites. Personally I would never buy a flip because you are overpaying for sure. But I read recently that there is a bill being drafted to tax house profits an extra 25% if the house sells within three years of initial purchase. I believe this bill is to specifically target house flippers. California politicians bang on about "affordable housing" but I don't think this does anything to address the "affordable housing" aspect of the housing market, it just looks like the state is going to make more money. Anyway, so when the young start to move in to areas where they can actually afford a home and the neighborhood starts to improve, there is much gnashing of teeth over the "gentrification" of the area.

#### Tigers!

##### Veteran Member
My daughter and her fiance have brought (Nov. 2022) a house/land package in Lara (Melbourne, Australia) for ~$600k. Small block, the house will be nothing flash. When I was growing up (60s-70s) nobody wanted to live in Lara. A similar block now costs >$700k. Stupid.
At that price both will need to work for decades to pay it off. If one loses their job or is injured etc. then after about 6 months they will be in strife. My daughter is an ambo so the pay is quite reasonable provided she gets the overtime. But if she gets the overtime then she will not spend much time with fiance/hubby or any kids they might have.
I paid $14k for my land in 1991. Installed a kit home for$80k in 1993.
Housing prices in Aust. have lost any links to reality.

#### Rhea

##### Cyborg with a Tiara
Staff member
much. But living in the 909 is not for the faint of heart. But it really is a bit of a mystery as to how people manage in the typical LA County home. Houses in my neighborhood are at least $900k for about 1,100sf, 3 bed home, the lot size varies. A house across the street from me is on the market at$1.2m, I'd be surprised if they get that much but it will be close. Rentals in my area for a two bedroom apartment is at least $2,800. Yeah, those are the kinds of numbers they talk about. They blow my mind. Both my kids are resigned to leaving California even though they quite like it here. I will try to help them stay if I can. Yeah, me, too. I hear them talk sometimes about how “they’ll never own a house,” and I remember thinking that myself when I was first looking and interest rates were 16%. It seemed impossible, but it was possible. Starting small. But they have parents who can and will help, so I imagine they’ll have their house at some point. Their age-mates won’t all be able to without help, perhaps. And it’s true that I could not afford to buy my own parent’s house, and moved out of state. But the point of that is that they can move out of state. I hope for them that remote work really takes off. Then they can live anywhere, even here. <3 Imagine paying$800k for a modest home plus the property tax every year, you must be sitting on boxes and eating spam six days a week. But somehow people are doing it but I really don't know how, they must have saved for a significant down payment or something.
Yeah, I just don’t know.

#### Hermit

##### Cantankerous grump
I chat with my friends who live in high price housing markets and I am stumped on how this works.
Do y’all mind sharing your stories?
This boomer basically sleepwalked his way into it with some hard yakka and a truckload of luck. I never intended to become a home owner. When I came to Australia I was still a schoolboy, a couple of months short of 16. Our first abode was a migrant hostel about 2.5 kilometres from Maroubra Beach. The ocean had fascinated me since we went on a holiday to the north Sea in Germany, so I took a walk down to it the day after our arrival. The weather was shit. Cold, and a stormy southeasterly blew rain into my face on my way. What I saw when I got to the north point of the beach was a revelation. A couple of boys were paddling through mushy whitewater on sticks. Then they turned around, stood up and travelled back towards the shore. This I gotta do!

And that is all I was interested in doing for the next 17 years. Jobs were easy to get, but I only ever kept any one of them for long enough to go on surf trips up and down the coast from Sydney, or to build another kneeboard whenever I broke one. I also got fired from a fair few jobs for taking too many sickies when the surf was too good to waste my time at work. I did not want to get chained to years of mortgage payments or paying off fancy cars. Life was too short for that shit.

The downside was that I was regularly short of money. Things came to a head when I was about to return to Sydney from the Gold Coast where my father lived with my stepmother at the time. My stepmother took me aside and handed me a 50 dollar note, saying "I think you could do with one of these." At the time that would have been the equivalent of a day's wages. I thanked her and thought "Yes, I'm broke again, aren't I?" It was at that point that I was sick of my hand to mouth existence to the point of putting an end to it.

Back in Sydney I found another job easily enough. I enjoyed driving and people were not all that fussed about checking your qualifications or work history at the time. All I had to do is to check the classifieds and turn up at the site of an advertiser seeking a driver 15 minutes before starting time. Once there, I told them how i drove a ute for Brearley's. a 12-tonner for Bowen's, a semi for Cook's or whatever suited the occasion. I obviously didn't tell them that half of the dozen or more of the employers fired me for taking too many unscheduled days off, or that one of them sacked me for squashing a car parked at the entrance of a wharf with the triaxle of a 41 foot trailer. Easy peasy. Nobody even asked me to show them my license.

Two years after my return to Sydney I was still driving for the same company, breaking my record by 18 months or more, and my savings account had grown to a massive eleven grand. I became ambitious. Surely, subcontracting to someone with one's own truck would pay more than driving someone else's for a wage? I checked the "truck with work" ads and wangled some finance after finding a suitable deal. It was a $12,000 loan, and to this day the most stressful financial commitment of my life. Anyway, after a mishap (the engine blew up three months into the venture, leaving me with the princely sum of 64 dollars cash in the bank at Christmas) things went swimmingly. Two and a half years later my bank balance was burgeoning once more. 30 thousand bucks. What on earth was I going to do with all that? Just leaving it there was just stupid. Mhhhh. My landlady was OK, but her husband was a pain, and the rent kept going up. What if...? I lived in Glebe at the time. Lovely, bohemian inner Sydney suburb with lots of second-hand bookshops, sleazy pubs, a cinema showing offbeat movies, a couple of halfway houses with recently released heroin addicts and stuff like that. It suited me down to the ground, but unfortunately it was also in the early stages of becoming yuppiefied. The housing market was out of my price range. But there was nearby Newtown. More affordable, and what's more, more bohemian. Dozens of tiny restaurants with menus from all four corners of the world, opportunity shops, an actual family owned and run greengrocer, and a bunch of daggy pubs with regular pub bands, one which was particularly favoured by gays sat cheek by jowl on the narrow main drag, King Street. Best of all, two fast food franchises, McDonald's and KFC tried to establish themselves there but didn't last long. Wrong demography. Without going into much detail, I finished up buying a tiny single story two-bedroom plus study terrace on a 5 x 30 metre block of land. Built in 1890, it was in dire need of renovation (which never happened while I owned it). Getting the mortgage involved some bending of the rules, but the manager of the building society branch I dealt with was most accommodating. In the end I finished up with a$106,000 mortgage on a house 6 kilometres from Sydney's harbour bridge I bought for $154,000 in 1992. Heaven on a stick. All things must change, though. Yuppies bought run-down terraces and spent fortunes upgrading them. One by one second-hand shops closed down, as did the greengrocer. A special day of mourning was the day Cornstalks closed for good. Then came the return of franchised businesses, KFC and McDonald's. And new ones as well, like Gloria Jeans and some fashion shops, the names of which I can't remember. Time to move out. I looked at moving to Newcastle, a once horrid coal mining city two hours north of Sydney, that scrubbed up quite nicely in recent years, but could not find an area I would feel at home in. Then I got seriously attached to someone which necessitated me moving to South Australia. In 2005 I sold my tiny Newtown terrace for$499k and bought a rather larger, freestanding home on a 900 square metre block of land in a small city 380 kilometres (by road) from Adelaide's CBD for $280. The person who bought my terrace spent somewhere between 2 to 300k on doing it up and sold it in 2010 for just under a million bucks. It is now valued at around 2 million. I will never be able to afford to buy anything in inner Sydney ever again. Luckily, I can't think of a reason why I would want to. The ambience I so liked has been destroyed for good. #### Toni ##### Contributor I tend to assume that the point of societies and economies is the benefit to be had from the arrangement, individually and collectively, that with progress life becomes easier for all its members.....yet considering developments in recent times, that doesn't seem to be the case. Things can't be perfect for everyone, all the time. There is usually the generational whining. I tried to explain to Boomers that the stock market has exploded during their life time. College was affordable. Housing wasn't too expensive. Health care not too nutty. So yeah, you better have done well you lucky fucks! The latest generation has a stock market that just yo-yos like madness, college is through the roof expensive, health care costs continue to increase, and housing gets expensive. I feel like my generation, Late Z'er were the last ones to get out into the old world where you went to college (worked hard... well some did), graduated and got a job, and things work themselves out. I graduated, got a house in '03, and since then the Great Recession and a global pandemic. It isn't WWII, but there were blue collar jobs back then too. Boomer here. We lived through the Viet Nam war, the Cold War, nuclear bomb drills, inflation, stagflation, high unemployment and a host of other economic horrors. We also got to experience measles, mumps abs chicken pox and all have these nice scars from smallpox vaccinations. We were thrilled our kids could get vaccinated against so many childhood diseases abs get antibiotics for ear infections and strep throat which is possibly why I have a small heart murmur. The first of our friends who purchased a home got a mortgage rate of 17-18% ( I forget the exact interest) or what my kids call usury but was a decent rate for the time. We couldn’t afford a house for several years and purchased our first home when we had 3 kids, paying an interest rate that was quite good fir the time but 2-3 times what our kids currently pay on their mortgages. Yes, our houses’ purchase prices were much lower as were our earnings—and our lifestyle. I was almost 50 when I bought my first car. Last fall, my husband bought a brand new vehicle for the first time—because it is so difficult to find decent used cars abs the new one was a little cheaper than the only used one he could find. All of our children purchased homes for significantly more than our first home cost and one is worth probably twice what our current home is worth now, even though their home is less than half the size of our home which is much more updated. But they live in a major city and have easy access to loads of restaurants, bars, clubs, concert venues, shopping, etc. They ‘can’t afford kids’ but mostly that’s because they don’t want to give up their 3-4 nights a week out, etc. 3 have been to Europe, something I’m giving up on thanks to the pandemic and WW3. The only one who had student debt beyond a couple ( unde 3) thousand dollars total has debt because of law school which we could not afford to pay for. I agree that the cost of college and grad school or professional school is prohibitive —and I know because hubby and I paid for our own plus the kids’ undergrad. The cost of daycare is also extremely high and yet day care workers are not well paid. We faced different challenges than our parents did or than our children do now. But we did have the good sense to recognize and appreciate the hardships our parents faced and the sacrifices they made for us. #### Toni ##### Contributor Daughter is in the process of buying a 3-bed/2.5-bath condo in Niles (another suburb NW of Chicago, ~25min drive from where I live), after discovering monthly mortgage costs are comparable to monthly apartment rents of similar size places here in Chicagoland. The down payment was the tough part for her, but Husband & I helped with that. Youngest son just bought his first home—a townhouse after making a similar discovery. Heck, years ago, that’s why we bought our first home—rent went up to equal a mortgage payment. I will never forget telling the landlord when she announced our rent was going up that it was equal to a mortgage payment—and her saying smugly: ‘If you can get a mortgage.’ Damn straight we could and did. #### Toni ##### Contributor Here's what I'm using for a bit of context: Median household income:$78,672
Median value of homes: $538,500 Median monthly owner costs with mortgage:$2,422

$4K a month alone is$48,000 a year, which to me is a staggering amount of money to pay on a mortgage. You could maybe manage that on a median CA household income, but I bet it's unusual. I'm guessing that your friends have a household income much higher than the median, and I'm guessing that there aren't many people who can afford these million dollar homes.

(I've heard that some people do interest-only repayment plans, but I can't see how that is anything other than financial suicide unless you are aggressively building a real estate portfolio.)

I've watched a fair bit of HGTV and the variation in house prices from one TV show to another is incredible. It looks like you can get some absolute bargains if you are willing to live outside of a big city, although it isn't at clear whether those are good places to live (and get a job) overall.
My understanding is living outside of LA is called "living in Phoenix".

#### Toni

##### Contributor
Hunting I understand. Farmers and other wooded land owners often allow others to hunt, with permission. Perhaps not so easily as when I was a girl. Even then, only someone you knew and trusted. Logging? That’s a huge Wow. Asking if you want to sell scap metal? I get that. Asking if they can just have scrap metal? Wow.

#### Rhea

##### Cyborg with a Tiara
Staff member
Around here the scrap metal is lying around in yards and fields, so the scrappers are doing you a favor by cleaning up your yard. Actually, I’ve been trying to find one for a while - we have a couple of hundred pounds in a pile waiting for a pickup to drive up and ask, and I haven’t seen one since the pandemic!

One year I had stone pickers show up and ashk if they could have our pile of rocks in the field. They stack it up on pallets, wrap it in chicken wire and drive it off to the city for stone walks or something. 100 years ago, the farmer who owned this place made two piles, each 200 feet long. So it’s just sitting there waiting for this guy in his tractor trailer with his skid-steer. Someone got some nice flat slate.

#### spikepipsqueak

##### My Brane Hertz

My daughter and her fiance have brought (Nov. 2022) a house/land package in Lara (Melbourne, Australia) for ~$600k. Small block, the house will be nothing flash. When I was growing up (60s-70s) nobody wanted to live in Lara. A similar block now costs >$700k. Stupid.
At that price both will need to work for decades to pay it off. If one loses their job or is injured etc. then after about 6 months they will be in strife. My daughter is an ambo so the pay is quite reasonable provided she gets the overtime. But if she gets the overtime then she will not spend much time with fiance/hubby or any kids they might have.
I paid $14k for my land in 1991. Installed a kit home for$80k in 1993.
Housing prices in Aust. have lost any links to reality.
Quoting Tigers for context. Our market differs from the US.

Bought my first house (3BR, weatherboard, tiled, land 50' x 124', in Melbourne ) in 1983 for $48k. The mortgage was$33k. I was single, living with my boyfriend, (who did not contribute, another story) and had no trouble meeting the mortgage and getting the house restumped, rewired, replastered where necessary, on a mid level salary. Sold that for $142k in 1991 to a young couple starting out. An amount that reflected inflation and the increased value of the place but placed no undue burden on them. By comparison, in 1999 I bought a tiny 3BR weather board, tin roof, land irregular but 10% smaller, in a rural, coastal area for$57K.

Sold that around 2002/3 for $165k with very minor renovations (new water tank, floors sanded and polished, slate surround to heater). Just heard that same house is again for sale. It has had a very substantial renovation and small extension, but even 20 years of inflation cannot justify the$895k they are asking for it. They will get it, however.

In 1999, small empty blocks were going for $11k in the area. In 2002 that skyrocketed suddenly to$80-100k. Covid, and the exodus out of cities, has seen the remaining land fetch in the region of $250k. I just Googled the median house price for Melbourne.$1,101,612

I don't know how young people are ever going to do it.

#### TSwizzle

##### Let's Go Brandon!
I don't know how young people are ever going to do it.

I bought my first property, a one bedroom flat/apartment when I was 20 with a little help from my parents who basically paid the legal fees. I don’t know how young people are going to get on the property ladder. Maybe young professionals will move into the more “diverse” neighborhoods and make something of it.

#### TSwizzle

##### Let's Go Brandon!
I live in a college town that is also a working class town for everything that isn’t related to colleges. The vast overwhelming majority of the rental market is geared for students, with many many previously single family homes converted to student housing. The net effect is that young families and newcomers to town are generally forced into apartments rather than their preferred choice of single family dwellings. {snip}

Surely you must realize that this is intentional. Our overlords do not like the suburbs, they don't like us owning cars and driving them, they don't like us taking flights. They want us jammed in to apartments, working within walking/cycling distance, not eating meat and so on.

#### Hermit

##### Cantankerous grump
I live in a college town that is also a working class town for everything that isn’t related to colleges. The vast overwhelming majority of the rental market is geared for students, with many many previously single family homes converted to student housing. The net effect is that young families and newcomers to town are generally forced into apartments rather than their preferred choice of single family dwellings. {snip}
Surely you must realize that this is intentional. Our overlords do not like the suburbs, they don't like us owning cars and driving them, they don't like us taking flights. They want us jammed in to apartments, working within walking/cycling distance, not eating meat and so on.
Yeah, those shapeshifting reptilian aliens are pure evil.

#### Tigers!

##### Veteran Member
I have turned off the ringer on my phone because I get calls from 8am to 8pm from investors/flippers/assholes wanting to make a "cash offer" on my house.

That reminds me, I need to get our 'leave us the hell alone' sign back up on our mailbox. Damn windy days..

We get a few of these offers per week.

Funny, the offers we get are:
Can I hunt on your land?
Who are they hunting on your land? There are a few pollies here in Australia we could give you.

#### TV and credit cards

##### Veteran Member
People keep talking about greed. I think it's just how capitalism works.
It’s capitalism when it’s my capital gain.
I recommend everyone dip their toe in the rental market if the opportunity presents itself. It will let one know if they are the altruistic individual they think they are.

#### Hermit

##### Cantankerous grump
People keep talking about greed. I think it's just how capitalism works.
It’s capitalism when it’s my capital gain.
I recommend everyone dip their toe in the rental market if the opportunity presents itself. It will let one know if they are the altruistic individual they think they are.
When I bought my first home I did not have capital gain in mind, but when I sold it I did get 3.24 dollars back for every dollar I bought it for 12 years earlier. That is due to the so-called iron law of capitalism - prices being determined by supply and demand.

But yes, capitalist systems accommodate greed the more the greater they are modelled on the laissez-faire principle. What we need is a mixed economy - capitalism, the excesses of which are leavened by socialist regulations.

#### gmbteach

##### Mrs Frizzle

My daughter and her fiance have brought (Nov. 2022) a house/land package in Lara (Melbourne, Australia) for ~$600k. Small block, the house will be nothing flash. When I was growing up (60s-70s) nobody wanted to live in Lara. A similar block now costs >$700k. Stupid.
At that price both will need to work for decades to pay it off. If one loses their job or is injured etc. then after about 6 months they will be in strife. My daughter is an ambo so the pay is quite reasonable provided she gets the overtime. But if she gets the overtime then she will not spend much time with fiance/hubby or any kids they might have.
I paid $14k for my land in 1991. Installed a kit home for$80k in 1993.
Housing prices in Aust. have lost any links to reality.
Quoting Tigers for context. Our market differs from the US.

Bought my first house (3BR, weatherboard, tiled, land 50' x 124', in Melbourne ) in 1983 for $48k. The mortgage was$33k. I was single, living with my boyfriend, (who did not contribute, another story) and had no trouble meeting the mortgage and getting the house restumped, rewired, replastered where necessary, on a mid level salary. Sold that for $142k in 1991 to a young couple starting out. An amount that reflected inflation and the increased value of the place but placed no undue burden on them. By comparison, in 1999 I bought a tiny 3BR weather board, tin roof, land irregular but 10% smaller, in a rural, coastal area for$57K.

Sold that around 2002/3 for $165k with very minor renovations (new water tank, floors sanded and polished, slate surround to heater). Just heard that same house is again for sale. It has had a very substantial renovation and small extension, but even 20 years of inflation cannot justify the$895k they are asking for it. They will get it, however.

In 1999, small empty blocks were going for $11k in the area. In 2002 that skyrocketed suddenly to$80-100k. Covid, and the exodus out of cities, has seen the remaining land fetch in the region of $250k. I just Googled the median house price for Melbourne.$1,101,612

I don't know how young people are ever going to do it.
Things are nuts here in SEQ too.
We paid mid $300k for our 4 bed 2 bath house on 725m 9 years ago. Next door neighbour just sold his three bed, 1 bath house on a similar sized block for$550k. He does have a pool, but it’s on a main road corner. he gutted and redid his place. I know he would have paid \$270k for his house as he bought his just after I bought my old place across the road.
Bilby and I like our home, and while it needs work, we are happy to stay here. I do sometimes want to move to a more rural area, like my brother just has, but we need considerably more cash for that.