Housing Bubble, credit bubble, public planning, land use, zoning and transportation in the exurban environment. Specific criticism of smart growth, neotradtional, forms based, new urbanism and other top down planner schemes to increase urban extent and density. Ventura County, California specific examples.
Sunday, October 28, 2018
Housing v. Household Income Necessary
I don't believe it but this is the graphic (click for larger readable):
I wonder what total payment means, PITI? Denver is nuts, my kids condo is worth over 3 times what she paid for it 12 years ago. Any way the coasts are going to get hit at some point. IMO.
What was the restaurant? BTW, went to grab something at the local Chevy's and found the location closed without warning. Same thing happened with the local Best Buy recently. Both are in more "affluent" areas, too.
The lipstick is wearing off this pig of an economy.
The fine print notes that they use the median home price for the particular area - then they calculate the PITI based on 28% of gross and assume 20% down.
So, it's really the salary needed to buy a "median" home.
Mostly, the chart simply tells you which cities have ridiculously high median home prices.
It's some of the low-end spots that have me gaping.
I mean, I get why Detroit is $46k given the long-running decay.
But Pittsburgh at $38k ... Indi and Louisville @ $42k are surprisingly low.
In the out back here we don't even make the map. I can't figure out why average people waste their time in over priced markets. Lot of decent jobs around the country with cheap living.
Market is happy to start the day but could be gone in a flash!
LOL! Most people have no clue about money not even balancing their check book. Drives me nuts when banking "Do I want a balance on the account?". People must spend everything they get. They barrow for any little problem that comes along especially the dysfunctional who use cash advances stores. Save,LOL!
I agree with most of that. We have a finance system designed to cater to the rich, while keeping the working poor confused and compliant.
Some of that is cultural. But, I wonder how much is a direct result of finance industry meddling and intentional obfuscation and willful misinformation.
I know my grandparents GENERATION (the ones who lived through the Depression and WWII), had the desire and capacity to save. I remember when "Christmas Club" accounts could be set up at banks, to allow people to save for Christmas (instead of relying on credit). When I was born, one of the stock baby shower gifts were US Savings Bonds - (which my Mom used to seed my first savings account - which got opened when I was about 9).
My view is that if one wants a society to have a "saving" mentality, then you need to support that from day one. The problem is, starting salaries today make saving effectively impossible. In '57, my Mom and her cousin could rent a small apt., make a car payment and feed themselves, AND save a small amount while making minimum wage. By 1985, I was making 20% above minimum wage, and could barely make rent, food and car payments each month and couldn't save, and I was a born miser. The instant I got a job that offered 401k, I signed up, and I continued upping my contribution as I got raises.
But, I was almost 30 before I was making enough where I actually had "disposable" income.
Today, it's far worse than when I was in my 20s.
In the 50s, a 20-something man could start off with a job that paid enough to cover rent, food, car, and save for a down payment on a house.
Today, the banking industry makes getting credit cards easy and makes savings accounts worthless. My "savings" account currently has an interest rate of 3 tenths of 1 percent.
The fees charged on savings vehicles today means if you cannot contribute enough fast enough, you pay more in fees than you get in interest. I put $500 in an educational IRA for my niece long ago - (without doing near enough research on it) - but then went through some financial pains thanks to my ex and failed to add to it for several years. By the time I was in a position to add to it - the total value was LESS than my original $500.
When I opened my first IRA (I was still in college), I had been reading all about interest rates for months. So, I knew what was on the horizon. But, when I suggested starting off with the maximum 4-year lock-in rate - the person at the bank sat there trying to convince me to go with the 6-month rate because rates were going to be rising - when every news story for months was saying they would be falling, perhaps for years.
America saved when George Bailey was allowed to run banks.
The banks are all run by Henry Potter these days. Once upon a time, financial advisors were about helping less educated people make informed decisions that would benefit them. Today, it's all about the skim. It's all about figuring out ways to scrape another percent away from the blue collar guys take home without providing any actual service in return.
I really don't know how one could expect working class Americans to save in that environment.
Anybody could save a dollar a week. The trick is not to spend it put it deep under the mattress until it gets up to the fabled $400 mark and then put it in the bank. If you are a miser put 2$ away.
Honest opinion. Anyone who relies on a job is worth what they get. I had a couple of Adult jobs and most on flat rate commission. This is as close to owning your own biz and not take massive headaches and responsibility home with you. No family member taught me anything about money wealth or business. People float through life and take the easy way that yields little. Savings is less about the interest you get but the bank you have to avoid paying interest to the Bankster when a problem arises. When ever you trust your money to others beware. No one is your friend they are out to make money, period. Commonsense does not exist anymore nor does thinking and rational. Dave Ramsey is making a fortune selling commonsense and simple math.
No we do not need to raise the minimum wage. We need to stop importing poverty.
Yes we do! Trickle down doesn't work until you get 3% unemployment, or so, and even I don't think it's gonna happen. Meanwhile the mkt has turned really grouchy. We are in correction territory now, right. How much would a very good, but not great mens' suit cost??
By the way, the hub and I agreed that when we were kids, nobody moved until the got very old and went to a nursing home, or died, or black people moved in (good forbid a black person move into your block.)
A job is worth exactly what justifies the ROI and not a dime more.
If you legislate payrolls then you're guaranteeing that job will be priced out of existence, if not directly then via replacement from outsourcing or automation.
Liz, I bought a very sharp looking suit from Macy's 5 years ago for my wedding for $200-$250, dress shoes $100, good quality fitted dress shirt $50 from JoS Bank, tie $10. All in maybe $450 and I wear it occasionally since then unlike the wife's wedding dress.
While we were back east the weather turned much colder than predicted. I had my lined shell Cunard Line jacket they sell on the boats to Arctic cruise passengers for $199. About $3 three weeks ago. Mrs. Dawg opted for layers but not her fault that wasn't enough. So we went shopping. The Protestant thrift stores on The Cape were great. She got a full shell with hood in the collar jacket Columbia brand for $7. There's a difference twixt cheap and thrifty.
Just don't ask about the Mercedes stuck in the driveway.
#2 son closed on his first house today. The Bank of Mom and Dad helped with the down. My daughter helped too so as to keep the amounts less than tax free allowable. 18% is very ouchy. It is an older house in Richmond, CA. Not in the bad part of town. Now He avoids the commute across the Bay Bridge. Re: housing prices I have no sympathy for those who did not do a little pre-birth planning. Our rentals are our savings accounts. Back in the day, we used to plan for a purchase of a qt of ice cream. The $125 monthly on our first house was a push. That could be done on my salary and a stay at home wife. I made $5000 per year and in two years we saved $2000 and paid $500 down to buy that first house. See a little pre-birth planning goes a long way.
28 comments:
What part don't you believe?
I wonder what total payment means, PITI? Denver is nuts, my kids condo is worth over 3 times what she paid for it 12 years ago. Any way the coasts are going to get hit at some point. IMO.
That is some yearly percentage increase.
Oh, I had to leave the restaurant because it was so loud, we couldn't have a conversation. If anybody cares.
We do care!
What was the restaurant? BTW, went to grab something at the local Chevy's and found the location closed without warning. Same thing happened with the local Best Buy recently. Both are in more "affluent" areas, too.
The lipstick is wearing off this pig of an economy.
55° outside. Hub put on a coat to go outside. To get the fish wrap. It's wonderful.
Humm, people don't buy cars from the Internet.
Out Best Buy went away many years ago.
Do I dare read the news blogs?
What will the mkt do today.
The fine print notes that they use the median home price for the particular area - then they calculate the PITI based on 28% of gross and assume 20% down.
So, it's really the salary needed to buy a "median" home.
Mostly, the chart simply tells you which cities have ridiculously high median home prices.
It's some of the low-end spots that have me gaping.
I mean, I get why Detroit is $46k given the long-running decay.
But Pittsburgh at $38k ... Indi and Louisville @ $42k are surprisingly low.
Pittsburg is nice, I think.
Good Morning! 80F today maybe.
In the out back here we don't even make the map. I can't figure out why average people waste their time in over priced markets. Lot of decent jobs around the country with cheap living.
Market is happy to start the day but could be gone in a flash!
79° here.
MSN Money is telling people how to save money etc. for a recession. As if they would .
LOL! Most people have no clue about money not even balancing their check book. Drives me nuts when banking "Do I want a balance on the account?". People must spend everything they get. They barrow for any little problem that comes along especially the dysfunctional who use cash advances stores. Save,LOL!
LBD,
I agree with most of that. We have a finance system designed to cater to the rich, while keeping the working poor confused and compliant.
Some of that is cultural. But, I wonder how much is a direct result of finance industry meddling and intentional obfuscation and willful misinformation.
I know my grandparents GENERATION (the ones who lived through the Depression and WWII), had the desire and capacity to save. I remember when "Christmas Club" accounts could be set up at banks, to allow people to save for Christmas (instead of relying on credit). When I was born, one of the stock baby shower gifts were US Savings Bonds - (which my Mom used to seed my first savings account - which got opened when I was about 9).
My view is that if one wants a society to have a "saving" mentality, then you need to support that from day one. The problem is, starting salaries today make saving effectively impossible. In '57, my Mom and her cousin could rent a small apt., make a car payment and feed themselves, AND save a small amount while making minimum wage. By 1985, I was making 20% above minimum wage, and could barely make rent, food and car payments each month and couldn't save, and I was a born miser. The instant I got a job that offered 401k, I signed up, and I continued upping my contribution as I got raises.
But, I was almost 30 before I was making enough where I actually had "disposable" income.
Today, it's far worse than when I was in my 20s.
In the 50s, a 20-something man could start off with a job that paid enough to cover rent, food, car, and save for a down payment on a house.
Today, the banking industry makes getting credit cards easy and makes savings accounts worthless. My "savings" account currently has an interest rate of 3 tenths of 1 percent.
The fees charged on savings vehicles today means if you cannot contribute enough fast enough, you pay more in fees than you get in interest. I put $500 in an educational IRA for my niece long ago - (without doing near enough research on it) - but then went through some financial pains thanks to my ex and failed to add to it for several years. By the time I was in a position to add to it - the total value was LESS than my original $500.
When I opened my first IRA (I was still in college), I had been reading all about interest rates for months. So, I knew what was on the horizon. But, when I suggested starting off with the maximum 4-year lock-in rate - the person at the bank sat there trying to convince me to go with the 6-month rate because rates were going to be rising - when every news story for months was saying they would be falling, perhaps for years.
America saved when George Bailey was allowed to run banks.
The banks are all run by Henry Potter these days. Once upon a time, financial advisors were about helping less educated people make informed decisions that would benefit them. Today, it's all about the skim. It's all about figuring out ways to scrape another percent away from the blue collar guys take home without providing any actual service in return.
I really don't know how one could expect working class Americans to save in that environment.
Anybody could save a dollar a week. The trick is not to spend it put it deep under the mattress until it gets up to the fabled $400 mark and then put it in the bank. If you are a miser put 2$ away.
We desperately need to raise the minimum wage.
Honest opinion. Anyone who relies on a job is worth what they get. I had a couple of Adult jobs and most on flat rate commission. This is as close to owning your own biz and not take massive headaches and responsibility home with you. No family member taught me anything about money wealth or business. People float through life and take the easy way that yields little. Savings is less about the interest you get but the bank you have to avoid paying interest to the Bankster when a problem arises. When ever you trust your money to others beware. No one is your friend they are out to make money, period. Commonsense does not exist anymore nor does thinking and rational. Dave Ramsey is making a fortune selling commonsense and simple math.
No we do not need to raise the minimum wage. We need to stop importing poverty.
Yes we do! Trickle down doesn't work until you get 3% unemployment, or so, and even I don't think it's gonna happen.
Meanwhile the mkt has turned really grouchy. We are in correction territory now, right.
How much would a very good, but not great mens' suit cost??
By the way, the hub and I agreed that when we were kids, nobody moved until the got very old and went to a nursing home, or died, or black people moved in (good forbid a black person move into your block.)
A job is worth exactly what justifies the ROI and not a dime more.
If you legislate payrolls then you're guaranteeing that job will be priced out of existence, if not directly then via replacement from outsourcing or automation.
Last suit I bought was early 2000's Shoes, trench coat and all was over a grand. All for a free diner but I have to say it was grand. :)
Liz, I bought a very sharp looking suit from Macy's 5 years ago for my wedding for $200-$250, dress shoes $100, good quality fitted dress shirt $50 from JoS Bank, tie $10. All in maybe $450 and I wear it occasionally since then unlike the wife's wedding dress.
I think I saw a hummingbird.
Yeah, we should buy something very nice that we can wear again!
Ok what would it cost now?
While we were back east the weather turned much colder than predicted. I had my lined shell Cunard Line jacket they sell on the boats to Arctic cruise passengers for $199. About $3 three weeks ago. Mrs. Dawg opted for layers but not her fault that wasn't enough. So we went shopping. The Protestant thrift stores on The Cape were great. She got a full shell with hood in the collar jacket Columbia brand for $7. There's a difference twixt cheap and thrifty.
Just don't ask about the Mercedes stuck in the driveway.
#2 son closed on his first house today. The Bank of Mom and Dad helped with the down. My daughter helped too so as to keep the amounts less than tax free allowable. 18% is very ouchy. It is an older house in Richmond, CA. Not in the bad part of town. Now He avoids the commute across the Bay Bridge.
Re: housing prices
I have no sympathy for those who did not do a little pre-birth planning.
Our rentals are our savings accounts.
Back in the day, we used to plan for a purchase of a qt of ice cream. The $125 monthly on our first house was a push. That could be done on my salary and a stay at home wife.
I made $5000 per year and in two years we saved $2000 and paid $500 down to buy that first house.
See a little pre-birth planning goes a long way.
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