Skip to main content

Housing isn’t actually that expensive. It’s a wages issue, not a price issue.

Obviously, it’s double sided. And this is not a full on market analysis. This is just me observing based on my area, which is in the sunbelt.

In summer 2024, I bought a small house. 950 sqft. 3 bed, 1 bath. It’s in a highly desirable area. Big for young professionals and young families, but a bad school zone, so people don’t live here really once their kids hit the age of 4 or 5. People upgrade in size and zoning at that point. Lots of rentals, young families, and some elderly live here.

I paid about $330K for this small, not very updated, 950 sqft 3/1. $330K is fair or even favorable to a buyer for this area, but still. I see the argument everywhere that it’s asinine that these 900 sqft or 1000 sqft 1950’s shoeboxes are going for such insane prices.

Well if you think about it, it’s simply just not an insane price at all. An older friend of mine bought a very similar house in this same area for about $170K in 2006 (or 2007, I’m not entirely sure but it’s one of those years). So, real estate is supposed to appreciate annually by 3% to 5%. If you take my friend’s purchase price of $170K in 2006 and you appreciate it annually by 3%, you get a price today of $330K. Meaning that his property has appreciated fairly, and I paid basically a bang on fair price for this house. However, everyone else would have said I was insane for doing this, and they would say that it’s ridiculous that the house costs this much because they wouldn’t do even the most basic analysis.

So what’s the issue in our situation? It’s wages.

More people need to understand this so that we can fight against the real issue. Employers need to pay better across the board, and wages simply need to be more well rounded generally from top to bottom. I’m not saying the minimum wage needs to be jacked up or anything like that. Maybe it does to an extent, but I’m just pointing out that the real issue for all of this is that we aren’t paid enough.

And yeah, of course prices of everything would increase if wages increased, but it’s not like prices would move directly with wage increases.

We need higher wages.

submitted by /u/bandzbandzbandzz
[link] [comments]

source https://www.reddit.com/r/RealEstate/comments/1rqlh87/housing_isnt_actually_that_expensive_its_a_wages/
Labels:

Comments

Post a Comment

Popular posts from this blog

Aren't comps/CMAs useless with buyer credits at close happening now?

I'm looking into buying a new construction townhouse in my HCOL US city. I'm seeing builders offering interest rate buydowns worth $20k-$60k on $800k homes (rather than just lowering prices) in order to keep their comps high for their other units, now that buyer demand has been declining. I asked my agent about these, and he said these buydowns aren't even the full story: buyers can write all kinds of other credits into an offer, like their closing costs, prepaid sewer fees, etc. Apparently cash buyers can just write in a "buyer credit at close" for any amount in their offer. So a new townhouse that appeared to sell for $800k in the MLS might have actually been a cash offer with a $100k+ buyer credit at close, meaning the buyer only spent $700k or less in total, but to the rest of the world they can only see the $800k! So that made me realize I can't trust comps/CMAs for other new construction townhouses. The sales prices could be way lower than they appear...
1 comment
Read more

Pool fill without engineer oversight

We are in the process of purchasing our first ever home in CA and we just discovered in the disclosures that the new build property we are purchasing previously had a swimming pool which was filled without an engineer onsite to approve the work (details from disclosure below). Is this something we should be concerned with or not? Is it something we should have additional inspections conducted on? We are originally from the UK and not really sure what to do with this information and if it is concerning or not. A POOL DID EXIST PREVIOUSLY. COPING, TILE, GUNNITE AND REBAR WERE ALL REMOVED AND DIRT AND CLEAN DRAIN ROCK WERE USED TO FILL IT IN. COMPACTED FILL WAS NOT USED AND NO ENGINEER APPROVED THE DIRT AND DRAIN ROCK FILL IN submitted by /u/tommot82 [link] [comments] source https://www.reddit.com/r/RealEstate/comments/dpyzw8/pool_fill_without_engineer_oversight/
Post a Comment
Read more

Making offers on houses not listed for sale.

I want to buy a home for retirement. I am looking at lots of options, mostly focusing on the locations that appeal to me. I see lots of Zillow estimates of homes that look like great deals to me. Are these estimates accurate, even though similar houses in the same area that are for sale are usually priced much higher? If so, is it realistic for me to try to make offers to owners that do not have their homes listed? Would a realtor even consider helping me do this? Or, do these values indicate that the houses listed for sale are overpriced, and I should just lowball until someone accepts? Are houses today tending to sell far below list prices, or ??? submitted by /u/chewybrian [link] [comments] source https://www.reddit.com/r/RealEstate/comments/1o4mcon/making_offers_on_houses_not_listed_for_sale/
Post a Comment
Read more