Real Estate Crash thread

[Toadman]

We just had a whole thread about this. If you can live on 4x the federal poverty rate plus the annual HSA max you can get an ACA plan for *much* less than $2k per month (in most states).

That thread gets into a number of other strategies for gaming down AGI. Also, not all money you take out of investments is considered income. Roth distributions, for example, are not taxable income.

Just a quick Google search and proverty income level in 2023 for a family of 4 is $30k. If you can't make it on 4x the poverty level, then you are doing something wrong. I long ago passed the income level where I can contribute to a Roth. So, at least I have that going for me.

I guess I need to go check out the early retirment health insurance coverage thread and get educated.

[Cisco Kid]

he stuck in his thumb
and pulled out a plum
and said what a good boy am i

This is how Gen Alpha is seeing housing
.
https://www.tiktok.com/@jessewelles/...48801465699614

[zion zig zag]

Just a quick Google search and proverty income level in 2023 for a family of 4 is $30k. If you can't make it on 4x the poverty level, then you are doing something wrong. I long ago passed the income level where I can contribute to a Roth. So, at least I have that going for me.

I guess I need to go check out the early retirment health insurance coverage thread and get educated.

It wouldn't be 4x the poverty level for a family of four unless you still have two dependents at home.

[singlesline]

There are a lot of things you can do to reduce your reported income. The goal in those early years is to spend cash from freely available savings. No 401k/IRA (non-roth) disbursements. No selling stock at a profit. Maybe make an effort to avoid dividends and interest. No buying/selling homes (I wonder to what extent this is preventing a bunch of early retirees from downsizing/moving and freeing up their homes to new families? it isn't just interest rates that lock people into homes).

You can *spend* more than 4x the poverty level...you just can't earn it that year. Paying down the mortgage can help with this too--may not be optimal from a rate of return perspective, but could be favorable if it keeps you in the low tax brackets by reducing the amount of money you need available to spend.
I'm sure the fancy estate attorneys can come up with all kinds of other crap you can do if you have enough money. Can you put the house in a trust along with enough assets to pay the ongoing bills? Can a trust sell investments to pay for kids to go to college so that you don't have to recognize it as personal income? I have no idea...but those all sound plausible.

Or...you know...we could implement a universal *multi*-payer healthcare system like used in most of Europe and get rid of these bullshit hoops people have to jump through. I'll save the pros and cons of multi- vs single-payer universal for another thread.

[Dantheman]

he stuck in his thumb
and pulled out a plum
and said what a good boy am i

This is how Gen Alpha is seeing housing
.
https://www.tiktok.com/@jessewelles/...48801465699614

Counterpoint: A quick walk through my neighborhood and it becomes pretty obvious that a lot of people should not be homeowners.

It wouldn't be 4x the poverty level for a family of four unless you still have two dependents at home.

Correct, for a 2-person household 4x is about $80k. If you no longer have dependents and aren't saving for retirement anymore that's not bad.

Also, add $10k onto that for HSA contributions. Those come straight off your AGI but you get to keep the money and can invest it.

Bottom line is that AGI is *very* gameable.

[Cisco Kid]

"Not allowed to own a home" sounds pretty uppity to my ears as a counter point. The POS homes in my hood are worth $800k and slums owned by lawyers and RE agents who won't maintain them.

[singlesline]

he stuck in his thumb
and pulled out a plum
and said what a good boy am i

This is how Gen Alpha is seeing housing
.
https://www.tiktok.com/@jessewelles/...48801465699614

The millennials were saying the same thing...right up until they all started buying houses (and are currently the largest group of home buyers).

I see no reason why the Zs and Alphas will be any different.


The curve may be a few years behind...but people are living longer and delaying major life events. Total anecdata, but as a millennial almost none of my urbanite millennial friends owned homes until the last 5 years. The only ones who did are the ones who got married at like 22. The ones who delayed marriage and/or kids until their 30s also delayed home ownership.

It is easy to be 20 and look out at the world and say "gosh, how could I ever afford that". It is another thing to have a more stable job, have a spouse that earns an income, have the fruits of saving for years, have a better understanding of how mortgages work...and suddenly the pieces start to fall into place.

You also see a preference shift...family with little kids suddenly starts looking at the house in the affordable suburb with decent schools that they never would have considered when they lived in a cool nightlife neighborhood at 25. And yeah...they still can't afford a sizable 3br place in the cool neighborhood, but that's OK because they don't go out 3x a week anymore.

[Dantheman]

"Not allowed to own a home" sounds pretty uppity to my ears as a counter point. The POS homes in my hood are worth $800k and slums owned by lawyers and RE agents who won't maintain them.

I did not say and would never say that anyone should not be "allowed" to own a home.

[Dantheman]

The millennials were saying the same thing...right up until they all started buying houses (and are currently the largest group of home buyers).

I see no reason why the Zs and Alphas will be any different.


The curve may be a few years behind...but people are living longer and delaying major life events. Total anecdata, but as a millennial almost none of my urbanite millennial friends owned homes until the last 5 years. The only ones who did are the ones who got married at like 22. The ones who delayed marriage and/or kids until their 30s also delayed home ownership.

It is easy to be 20 and look out at the world and say "gosh, how could I ever afford that". It is another thing to have a more stable job, have a spouse that earns an income, have the fruits of saving for years, have a better understanding of how mortgages work...and suddenly the pieces start to fall into place.

You also see a preference shift...family with little kids suddenly starts looking at the house in the affordable suburb with decent schools that they never would have considered when they lived in a cool nightlife neighborhood at 25. And yeah...they still can't afford a sizable 3br place in the cool neighborhood, but that's OK because they don't go out 3x a week anymore.

Shit, my next door neighbors bought their house in the late '70s for less than $20k and say it was a big financial stretch for them at the time.

[Cisco Kid]

My compass is skewed. Bought our 1st home in '72 for 2X our annual so so income with a 12% mortgage. We had to stretch by waiting to buy a new car after the deal closed.

[MontuckyFried]

I wish our politicians had the stones to REALLY tackle the issue of institutional RE investors in a meaningful way. Although FTC Chair, Lina Khan's done a bang up job doing what she can on a few different consumer fronts, real change needs to come from the legislature. Unfortunately I have zero faith that'll happen. Blackrock, Vanguard, State Street, etc. owns them all.

[Cisco Kid]

I did not say and would never say that anyone should not be "allowed" to own a home.

Sorry . "Shouldn't own a home"

[fastfred]

My compass is skewed. Bought our 1st home in '72 for 2X our annual so so income with a 12% mortgage. We had to stretch by waiting to buy a new car after the deal closed.

this kind of help sums shit up
it seems like everyone feels like they should buy a house for a super low interest rate still have room for two nice cars and big vacations plus all the fun stuff in life and buying endless shit to make you happy

you can't have it all

I fucking sound like a god damn boomer whats wrong with me?
I did just eat 20mg of edibles because I need to check out

[smmokan]

It’s insane to me that neither political party is running on a platform of universal healthcare or even basic shit like a national minimum vacation policy, national minimum sick leave or parental leave.

It will never happen in the US, and the offending party would get zero backing from corporate lobbies. Pinning healthcare to employment is the main way the government and corporations keep “we the people” tied to their job, which is how they’ll continue to take advantage of the American public. It’s all about money in this country, not what’s good for the public.

[Foggy_Goggles]

It will never happen in the US, and the offending party would get zero backing from corporate lobbies. Pinning healthcare to employment is the main way the government and corporations keep “we the people” tied to their job, which is how they’ll continue to take advantage of the American public. It’s all about money in this country, not what’s good for the public.

Boom. And this is why raging at each other is both pointless and the desired distraction of those pulling the strings.

Housing, food, medicine, healthcare, wage stagnation, higher education...all of it. It is no longer managed for the benefit of the people. I find it best to have a bit of levity around it and not get too bogged down. But it is real. Act locally. Be kind to those with other views. It is us versus them. Don't make it us versus us.

[Foggy_Goggles]

It will never happen in the US, and the offending party would get zero backing from corporate lobbies. Pinning healthcare to employment is the main way the government and corporations keep “we the people” tied to their job, which is how they’ll continue to take advantage of the American public. It’s all about money in this country, not what’s good for the public.

Boom. And this is why raging at each other is both pointless and the desired distraction of those pulling the strings.

Housing, food, medicine, healthcare, wage stagnation, higher education...all of it. It is no longer managed for the benefit of the people. I find it best to have a bit of levity around it and not get too bogged down. But it is real. Act locally. Be kind to those with other views. It is us versus them. Don't make it us versus us.

[AdironRider]

Like those issues didn't exist back in the 50s when some would argue housing was more affordable? Tribalism is an inherent human trait after all.

Housing inherently is going to be expensive. It is required for survival (in any sense of longevity) so is going to be priced accordingly.

[J. Barron DeJong]

Housing inherently is going to be expensive. It is required for survival (in any sense of longevity) so is going to be priced accordingly.

How does drinking water factor into this theory of pricing?

[Mazderati]

I fucking sound like a god damn boomer whats wrong with me?

You got old and got a bag. It's the transition from punching up to punching down.


Boomer.

[Toadman]

How does drinking water factor into this theory of pricing?

Water should be priced at market rates. No more subsidizing water. Either that or figure out a way to take all that flood water from the SE USA to AZ, NV, UT, NM, West TX and CA. But at some point some portions of those SW states are not going to be livable for 6 months out of the year. Blows my mind that they keep building in some portions of those states. Where they going to get the water?

[J. Barron DeJong]

Water should be priced at market rates. No more subsidizing water. Either that or figure out a way to take all that flood water from the SE USA to AZ, NV, UT, NM, West TX and CA. But at some point some portions of those SW states are not going to be livable for 6 months out of the year. Blows my mind that they keep building in some portions of those states. Were they going to get the water?

Ha.

Ok. Let’s limit this hypothetical to the Great Lakes area. Drinking water is still critical to survival, but it’s still cheap.

[schuss]

Water should be priced at market rates. No more subsidizing water. Either that or figure out a way to take all that flood water from the SE USA to AZ, NV, UT, NM, West TX and CA. But at some point some portions of those SW states are not going to be livable for 6 months out of the year. Blows my mind that they keep building in some portions of those states. Where they going to get the water?

When have real estate developers ever thought beyond the moment they sell the property?

[XXX-er]

Housing, food, medicine, healthcare, wage stagnation, higher education...all of it. It is no longer managed for the benefit of the people. I find it best to have a bit of levity around it and not get too bogged down. But it is real. Act locally. Be kind to those with other views. It is us versus them. Don't make it us versus us.

I thot the point was to make money god damn it, why do you hate America ?

[byates1]

That's right ppl. A new era.

You will move to Bozeman. You will pay FORTY THOUSAND DOLLARS a year to rent your apartment. We have pre rusted the roofing tin for you.

You will never own anything associated w this property. You will just pay us FORTY THOUSAND DOLLARS a year to rent.

It's a new area of modern living.

At least they have the gaul to set their nuts right on your face.

Sent from my Pixel 8 Pro using Tapatalk

[MontuckyFried]

You will move to Bozeman. You will pay FORTY THOUSAND DOLLARS a year to rent your apartment. We have pre rusted the roofing tin for you.

You will never own anything associated w this property. You will just pay us FORTY THOUSAND DOLLARS a year to rent.

It's a new area of modern living.

What I'd like to know is who are all these chumps willing to pay such exorbitant rents?! KNOCK IT OFF, PEOPLE!!!