What's up with the twenty somethings??

[sonnyjane]

sonnyjane, Southern California real estate prices boggle my mind. That's a whole different ball of wax. Ditto NYC. I'm astonished by how little you get for a half million dollars. Unless my family lived there the price would force me to move.

Agree. My husband is in military so we aren't here by choice. Our plan is to stay here for the next 11 years of my husband's career and then move to WA (no state income tax!) where houses are MUCH less. It depresses me to no end to do searches up there. As I said, our crap-hole 2/1 townhouse here is valued at $375,000 but in WA I can get a 4/2 with updated baths and kitchen overlooking the ocean (THE FREAKING OCEAN!) for about $285,000. We'd rather just wait and purchase a "forever home" than worry about buying a crappy one and selling it down the road for a marginal profit.

 

[rosetta]

A very outdated 1960s 3 bed semi detached house in my area costs above £600,000 (about $930,000).

We are saving for a huge house deposit instead of buying something we would hate to live in.

ETA we don't want to move out of London, and my husband just got a permanent post here so we are kinda stuck (good thing I love London, except for the ruddy house prices!)

 

[lulu]

I know about London and Paris, too. I watch House Hunters International. I'm very cosmopolitan!

 

[luv2sparkle]

I might be odd, but I have a different take on this. I live in Southern California where housing prices are astronomical. We currently rent a 2 bed/1bath townhouse built in the 70's with nothing "modern" about it. We pay $1800 a month but similar units come up for sale occasionally in our neighborhood for $375,000. A single family home in a safe neighborhood within a 30 minute commute of work would be $600,000 minimum. I'm only 29 so I'm not raking in the dough exactly. I've used every "rent vs own" calculator that they have and for owning to make more sense than renting, I'd have to live there for at least 7 years before I break even. Just for fun I've looked at things we CAN afford and to be honest, they are total dumps. I'm not looking for stainless steel and hardwood floors, but wood paneling, teal bathrooms, and yellow cabinetry is a little more than I want to work on in my spare time. For now I'd prefer to just not own than to own something that I hated simply for the sake of owning. When I do decide to purchase, I want to get a place that's move-in ready. Until that happens, I'm fine staying put.

What I will agree with you on is that "20-somethings" shopping for homes have very unrealistic expectations for their budgets. There's nothing wrong with wanting stainless steel appliances, steam showers, and wood floors, but you also need to understand that you aren't going to get those things for cheap!

Good for you sonnyjane. I so agree with you. We are in Socal too. Things are just different now. I was just having a similar conversation with my daughter, who is thirty, about cars. She has a volvo that she insisted she had to have. It has been a nightmare in repairs. We helped her get a loan to get it after her divorce. We wanted her to get a honda, because we have this awesome mechanic who is so honest it would make you cry, but she had to have the volvo. We have been repairing it or paying for repairs. So, I suggested to DH that we help her get a new car. We would probably save money. Because of the things she needs, I suggested a Prius C-great gas milage, reliable and with a fair amount of extras. The money she would save on gas would in essence lower the cost of the payment. No other car would make that much difference in her budget. But at 50 miles per gallon, it would save her at least a hundred dollars a month. She hated it and said it was ugly. I guess she thinks a mini van would be my vehicle of choice. NOT- I chose the car because of the needs of my family not what I wanted. The same goes for homes. You buy what your family needs not necessarily what you want. Usually what I want is more than my budget. But I guess I am old school, but I sure wish my kids would get it.

 

[LoveLikeCrazy]

Well, i'm nearing the end of my 20-somethings - but i have no interest in a starter house. We have been renting while i finish school and we save for a decent down payment. We want new construction, so we spend Sundays driving around to new developments, talk to builders, and look at land. We have been doing our homework. I'm certainly not very "handy" and neither is my SO and we are both extremely particular about what we want in a home. Neither of us want to get a "fixer upper" that would need major reno to make it "what we want" - we figure why not just buy what we want to begin with? We also are done "moving around" and we are making sure that the house we purchase is where we plan to live for many many many years. I was watching house hunters much of the day and i think obv it depends on area and market prices, but the "things" they were asking for, at the price point they were looking - was ALMOST impossible. They weren't being realistic with their expectations vs budget.

 

[justginger]

I might be odd, but I have a different take on this. I live in Southern California where housing prices are astronomical. We currently rent a 2 bed/1bath townhouse built in the 70's with nothing "modern" about it. We pay $1800 a month but similar units come up for sale occasionally in our neighborhood for $375,000. A single family home in a safe neighborhood within a 30 minute commute of work would be $600,000 minimum. I'm only 29 so I'm not raking in the dough exactly. I've used every "rent vs own" calculator that they have and for owning to make more sense than renting, I'd have to live there for at least 7 years before I break even. Just for fun I've looked at things we CAN afford and to be honest, they are total dumps. I'm not looking for stainless steel and hardwood floors, but wood paneling, teal bathrooms, and yellow cabinetry is a little more than I want to work on in my spare time. For now I'd prefer to just not own than to own something that I hated simply for the sake of owning. When I do decide to purchase, I want to get a place that's move-in ready. Until that happens, I'm fine staying put.

What I will agree with you on is that "20-somethings" shopping for homes have very unrealistic expectations for their budgets. There's nothing wrong with wanting stainless steel appliances, steam showers, and wood floors, but you also need to understand that you aren't going to get those things for cheap!

Others here do exactly what you're doing, sonny. If they love a certain lifestyle, like living a block from the beach, or in a house with period architecture, or in the city center, they rent in order to afford to do so. With the continuous movement upwards in real estate value, it is a hotly debated topic. Some say that despite selling their properties for at a decent profit ($100k +), when they actually done all of the figures, they've barely broken even. Interest, upkeep, those things kill you. Hence their decision to sell off, enjoy a higher quality lifestyle, and rent for the entirety of their lives.

They do tend to be in the minority here, as real estate down here has historically been a sure thing. Almost everyone that is middle class has a least one investment property, if not more. I suppose that will change with my generation though, as these kids are going to be paying off their family homes well into their 50s. Some with 'interest only' loans may be paying FOREVER!

 

[susimoo]

This is a very serious issue in the area I live - these shows are not drama for me to watch, they are reality.

I have 20 something coworkers and friends, lots of them. I AM (just barely!) a 20 something. Myself, and one other coworker, are the anomalies in the sense that we bought "starter houses." My house is average as. A 3 bed, 1 bath in a dreaded eastern suburb (since Perth sits on the west coast, the suburbs west sprawl an hour+ north and south of the city - people will sacrifice HOURS of their days to commute, so they can be within 15 minutes of the beach).

DH and I watch it happen. Kids whose parents had bought them properties before the huge boom in 2006, who can't bear to stay in the 3x1 nearly FREE property - nope, sell it off, get into the minimum requirement of a 4x2 with a pool, mortgaged to the hilt, and THEN start the extreme home makeover isht. Granite this, marble that, double headed showers are mandatory, custom splash backs, who can live without a jacuzzi tub?! Waterfall countertops, glass pool fencing, custom light fittings, don't forget the jarrah floorboards at $20,000 PER ROOM! Or, more commonly, they buy shoebox sized blocks, and then build houses as large as possible, EVERYTHING shiny and brand new. You can't put old furniture in a new house, can you?

I did the math. DH and I will have our modest place, which we've hardly maintained let alone renovated, paid off in 11 years total. Our double mortgage repayments are less than their minimum repayments as well, so we're enjoying the holidays these 20-somethings are always whinging about wishing they could have. At the end of 11 years, if we continue to set aside the same amount we are paying in mortgage payments, for the extra 19 years these kids will be paying on the places, we will have a MILLION dollars in cash. And a paid off house. Staggering.

There is no such thing as delayed gratification here anymore. No one wants to keep up with the Jones, they want to keep up with the Kardashians.

Ginger, I loved your post. You described Perth's attitude to house buying beautifully.

I was so struck by the size of the houses here! I often wonder what people do with so many rooms!
We are in a large rental property (to pack in all our relatives when they visit en mass!) and will be for some time, although we still have our house in Scotland. I am not sure I can face starting again, down under. But truth be told I do not know how else we could get on the property market here!! It's outrageous.

Oh and just as an aside. One thing that never fails to amaze me about houses here, no matter how large or grand. It seems no one places any value in good windows, doors or roofs.

I come from central heating and double glazing land. So when I realized how cold, windy and damned leaky the houses were here I was shocked!!
I remember my first storm here and being utterly bewildered that four rooms had leaks in them. When discussing it later with fellow Perth people, I was simply told all roofs leak sometimes.

Sorry for the thread jack everyone!!

 

[justginger]

Ginger, I loved your post. You described Perth's attitude to house buying beautifully.

I was so struck by the size of the houses here! I often wonder what people do with so many rooms!
We are in a large rental property (to pack in all our relatives when they visit en mass!) and will be for some time, although we still have our house in Scotland. I am not sure I can face starting again, down under. But truth be told I do not know how else we could get on the property market here!! It's outrageous.

Oh and just as an aside. One thing that never fails to amaze me about houses here, no matter how large or grand. It seems no one places any value in good windows, doors or roofs.

I come from central heating and double glazing land. So when I realized how cold, windy and damned leaky the houses were here I was shocked!!
I remember my first storm here and being utterly bewildered that four rooms had leaks in them. When discussing it later with fellow Perth people, I was simply told all roofs leak sometimes.

Sorry for the thread jack everyone!!

Small threadjack continued: Roofs here confuse me as well. People will pay thousands of dollars for security systems, monitored or alarmed, plus roller shutters, "crimsafe" screen doors, you name it. But the roof? Just tiles jigsawed together over wooden/steel beams. You can get on ANYONE'S roof, kick off a tile, and get into their house! Thanks to the tiled roof structure, almost all of them are leaky because when the rain comes down sideways or the wind blows up hard enough, it pushes the water underneath one of the overhanging tiles. But people still adore them - a tile roof brings up the value of a house, has to do with its insulation traits, I think. I can tell you though - if we ever build, our house is going to have a nailed down tin roof. No tiles for me.

And yes - the 'average' house here is MASSIVE. I grew up in a house that was about 1600 square feet, I think. It was a pretty average house in my area, 3 bedrooms, 1 bathroom, two living spaces, finished basement. Here? You walk in display homes and they are regularly around 3,300 square feet. Hell, their house plans don't go under 220 square meters (around 2400 square feet)! If you ask about building something smaller, they look at you like you're crazy. "But you'll of course want a bigger house when you have children, no one ever regrets building a bit larger. I'd recommend 250 at least (2,700)." Like my childhood was woeful due to lack of floor space?

New homes here have EVERYTHING. You have your panoramic, surrounding sliding glass doors that make your back patio inside OR outside. You have a games room, a living room, a formal lounge, AND a tiered theater room. You have double everything in the ensuite - his and hers toilets, sinks, shower heads. Each room must have a walk in closet. The kitchens all have above standard height ceilings. It feels like no one can have anything 'normal' anymore - everything is bigger, better, best! And YOU'RE the odd one for requesting anything less than what the youth of society has deemed 'necessary' (which we all see is complete bollocks).

LovesLikeCrazy - to answer your question of why you shouldn't just buy what you like now - because it's expensive, and often a poor financial move. I am not speaking for you, because I don't know your situation at all. I'm speaking for the people in my own life who have used that question/statement as justification for their demands for instant gratification and complete satisfaction. It used to be that people understood how money worked. Then somewhere along the way, people started getting greedy, and want everything NOW. They put their long-term financial security at risk by maxing out their borrowing capability to have all their desires with no patience necessary.

Some very quick, basic numbers to explain what I'm trying to say. I won't go into specific figures, because of course 'average' and whatnot is all relative to where you live. Example: myself in a starter house vs my coworker in her forever house. My required monthly mortgage repayments are less than half her's. We pay pretty much the same as she does though, so that means we are paying double payments. Additionally, she elects to only pay monthly, as it is slightly less each year than paying fortnightly, while we do pay fortnightly (this results in one extra payment each year). With these double payments, it means that my house will be paid off in just at 11 years, while her's will stretch the entirety of 30 years. The amount of interest saved for us cutting 66% off our loan duration is approximately $240,000. Yes, $240,000 just in saved interest. Add in the fact that, as mortgage-free, we'll have an extra money to save, you can see how it adds up. $240,000 in interest saved, plus the amount we were paying for the mortgage for that period of 19 years equals 1.03 MILLION dollars in our bank account BEFORE the magic of compounding interest.

Both my coworker and I will live in paid-off houses, but one of us is going to be a millionaire (though a millionaire without a double headed shower, woe is me ). Unless, of course, I decide to upgrade before that full million dollars is saved -- but it still means that I'll be able to upgrade to another mortgage-free house. The money we could have been spending late into our working years due to wanting instant house gratification will pad our retirement nicely.

NOW can you see how it can be a poor financial decision to want perfection immediately?

 

[distracts]

I don't really believe in "fixer-uppers." Twenty years ago, my parents bought a house that is big but needed a lot of work to make perfect. I have spent TWENTY YEARS listening to them complain about wanting to fix it up. About a decade ago they did the kitchen. A few weeks ago they started another room. It was just always too expensive or time-consuming or starting the project would disrupt life/use of the room too much. And many of my friends had parents who did more or less the same thing. Most of them don't actually fix up the houses until they retire. I think a fixer-upper might be doable if you get it years and years before you have kids, but it seems that once you have kids, the time and money needed to fix it up is no longer available for most people. So it seems kind of pointless to me. I know it's more expensive, but I also think quality of life is worth a lot.

With that said, my apartment during college had neither heating or air conditioning (in TEXAS. I often had to go to the library to do work because my computer overheated and shut off at home), dishwasher, or laundry on the premises (I drove to my parents' house to do laundry). The kicker? Still over 1k a month, plus utilities. At one point, someone in the apartment above me drained their bathtub and a pipe broke, and all that water drained down into the ceiling above my bathroom and it all caved in, along with buckets and buckets of water. CLASSY.

Because of the things she needs, I suggested a Prius C-great gas milage, reliable and with a fair amount of extras. The money she would save on gas would in essence lower the cost of the payment. No other car would make that much difference in her budget. But at 50 miles per gallon, it would save her at least a hundred dollars a month. She hated it and said it was ugly.

SHE SHOULD GET THE PRIUS. omg. I am a sports car girl through and through, but I drive a TON for my job and the $400 a month I save by driving my Prius is AMAZING and worth it. One day, I'll own a Tesla (DREAM BIG, right!?) but for now the Prius that I got because my dad wanted to buy a new one and just gave me his old one is perfect.

 

[FrekeChild]

We are in the midst of buying our first house, a starter home, if you will. But for a lot of people, it's an upgrade home. I'd bet that we sounded a lot like a lot of the first time buyers on House Hunters to our poor real estate agent because we were really picky. But there was also a series of problems that we were coming up against.

1. That whole mortgage bust? Well, that made home prices drop like crazy. Which caused investment people/companies to move in and buy homes for ridiculously cheap prices (typically around 50%-60% of the price a property would have sold for 6 years ago) and started renting them out. Not realizing this, instead of buying a house for cheap last summer, we rented. As did everyone else that had their homes foreclosed on, which made rental prices go through the roof. So this spring, there were about 20 buyers for every one house that hit the market, and barely any houses going up for sale. So we'd go look at a $150k house the second day it was on the market, and then talk to our real estate agent about it, and he'd inform us that not only did it already have 15 offers, but that the offers were for $150k...PLUS a guaranteed $50k cash. Our real estate agent told us that he hadn't ever seen this low of an inventory in the 25 years he's been doing it.

So, homes that were in our price range? Blown totally out of our price range.

2. We had conflicting ideas of what we wanted. My husband preferred newer construction, I preferred 1930-50s. I liked the idea of a project and a fixer upper, he, although he's really handy, wanted move in ready.

3. We agreed on everything as far as floor plans/numbers of bed/bathrooms, square footage, location/areas, schools, which, for us were the non-negotiables. Which was the only thing we were really looking for since we disagreed so heartily on the age/condition of the home. This also narrowed the pool of eligible houses by a huge margin.

What we ended up with:
late 1990s
original owner, relocating, move-in ready
great location, <5 minute commute for my husband
3 bedroom, 2 bath + office
granite, stainless steel kitchen
great room
high ceilings, tile, carpet in bedrooms
swimming pool, fruit trees, mature landscaping
1,800 sqft

We lucked the hell out. I saw the listing pop up as soon as it was listed. I got an appointment to see it first thing the next day, we put an offer in right away for asking price, and they verbally accepted it that night. They had told their agent that the first person that walked in and offered full price could have it. Luckily they held to their word - they got a higher offer the next morning. If we hadn't lucked out like this, we probably would have given up on house hunting because it was so awful looking at 40 different houses that didn't fit our criteria and/or were being bid up like crazy.

ETA: We're also both 31, and I'm a stay at home mom (for now) and he has a decent job that he's been in school for forever. So we've lived in the crappy apartments, and even with my dad for a while to help save cash. This house is far from our ideal, but it's perfect for what we're looking for for right now, and probably for a good many years, should we decide to stay there.

 

[Rhea]

A very outdated 1960s 3 bed semi detached house in my area costs above £600,000 (about $930,000).

We are saving for a huge house deposit instead of buying something we would hate to live in.

ETA we don't want to move out of London, and my husband just got a permanent post here so we are kinda stuck (good thing I love London, except for the ruddy house prices!)

I started crying when I read your post. We've been looking at buying recently (DH - 29 and me - 32 if that matters) and this is what we're up against too. A two-bedroom flat in a block with a small balcony cost £365,000 - £500,000 in our area. Forget semi-detached or a free-hold! DH works from home so we need a 2nd bedroom. We'd pay a hefty price in stamp-duty and fees and don't want to move again in the next few years (because that's really really expensive as well!) so we want a nice home that we can see ourselves in for a good 5-10 years. At our age and discussing children it doesn't make sense to live in "starter" flat where we'd have the expense of moving in a couple years to an area with better schools...or a flat where DH's office has to be in our living room.

For us it's not about the granite counter-tops or hardwood floors, it's about saving ourselves the cost and hassle of moving later by getting a nice flat the first time around. My mother does think that we're spoiled and she said as much when my sister and her boyfriend bought a house recently as well; their goals in house hunting were in line with ours. But my mother was in her early-20s when she bought her 1st home and she wasn't contending with the inner-city fight to live in a good school district, with a park close by because we won't have our own garden, or the thought that a living room wasn't really the best place to store a newborn (I'm 32 - need to think about this child thing now). I don't want a house for 2-3 years, it's not worth the hassle and fees. It needs to be a much longer-term purchase than that... So damn right I'm picky as a first time house hunter! But as a couple we are nearly out of our 20s

 

[rosetta]

A very outdated 1960s 3 bed semi detached house in my area costs above £600,000 (about $930,000).

We are saving for a huge house deposit instead of buying something we would hate to live in.

ETA we don't want to move out of London, and my husband just got a permanent post here so we are kinda stuck (good thing I love London, except for the ruddy house prices!)

I started crying when I read your post. We've been looking at buying recently (DH - 29 and me - 32 if that matters) and this is what we're up against too. A two-bedroom flat in a block with a small balcony cost £365,000 - £500,000 in our area. Forget semi-detached or a free-hold! DH works from home so we need a 2nd bedroom. We'd pay a hefty price in stamp-duty and fees and don't want to move again in the next few years (because that's really really expensive as well!) so we want a nice home that we can see ourselves in for a good 5-10 years. At our age and discussing children it doesn't make sense to live in "starter" flat where we'd have the expense of moving in a couple years to an area with better schools...or a flat where DH's office has to be in our living room.

For us it's not about the granite counter-tops or hardwood floors, it's about saving ourselves the cost and hassle of moving later by getting a nice flat the first time around. My mother does think that we're spoiled and she said as much when my sister and her boyfriend bought a house recently as well; their goals in house hunting were in line with ours. But my mother was in her early-20s when she bought her 1st home and she wasn't contending with the inner-city fight to live in a good school district, with a park close by because we won't have our own garden, or the thought that a living room wasn't really the best place to store a newborn (I'm 32 - need to think about this child thing now). I don't want a house for 2-3 years, it's not worth the hassle and fees. It needs to be a much longer-term purchase than that... So damn right I'm picky as a first time house hunter! But as a couple we are nearly out of our 20s

Aw Rhea, it sucks doesn't it? I laughed when I saw some of the so called high prices mentioned in this thread. If I could buy at those prices then I'd be laughing all the way to the bank.

We are in our 30s too, so we don't have time for starter homes. As you said, if you want a family, your home has to be able to accommodate it right now. It doesn't actually make sense moving up the ladder slowly unless you can make a healthy profit AFTER paying stamp duties and legal fees. Also remember that our historically low interest rates have only one way to go. Up. This means what we can just about afford right now may very rapidly become what we can't afford at all. Very risky.

The house my in laws could afford on one salary, we can no longer afford on two. I'm not bothered about high specs, I'm quite happy to do up a house myself. The cold hard reality is that to get a detached house (even a complete structural wreck) in my area, you need a minimum of 1 million pounds. If anyone tells me that I'm being a brat for wanting a house where I own all four walls, I may bite their head off.

 

[diamondseeker2006]

This is a timely topic because my daughter who is 20 something just for a contract to sell her first house on Thursday. When she graduated from college, it was less expensive to buy a 1000 sq foot house than it was to rent a 2 br apartment. Now, almost 6 years later, she is married and has a toddler and they want to move before having more children. But she is very sensible and does not want to be in too much debt, so they are looking at houses around 1600-1800 sq ft. Yes, she'd like to add granite countertops as she watches HGTV, but they will do those things as they can afford them and not go into debt doing it. Just wanted to add that starter homes aren't necessarily fixer uppers. They can just be smaller without high end features.

 

[dragonfly411]

lulu - The 20 somethings are the generation of entitlement. Period. My sister expects that and I just laugh at here. I'm 27 mind you. SO and I just bought our first home, everything in it but the dishwasher and AC are original from 1985. The cabinets are ugly. UGLY. The refrigerator was rusty on the front (we've moved it to the utility room as an extra and bought a used one that was in nearly new condition for $50.00 for our kitchen). Our upstairs shower has a leak and is so tiny I can't turn around comfortably in it. We're going to have to gut that entire bathroom and expand it into the office. The floor in the downstairs bathroom and laundry room is this ugly gravel style flooring. But we got 3 acres and a two story home with a new roof in the contract for 110k. And our location is ideal. We're off a country road, nothing but old old farming families with farms around us for about four miles, and then immediately into two small towns on either side that have grocery and drug stores as well as hardware and farming supply stores. I never expected granite counters or stainless steel, those are things you add as you make your home your own. I was just happy we found something that wasn't falling apart in our price range with land!!!

 

[ame]

The show makes me nuts, but it's more the Americans trying to buy overseas that makes me crazier. They clearly have done NO research on what's available there, what their money gets them there and they have no grasp on reality and I want to beat them all.

 

[gem_anemone]

I was 30 when we bought our house (DH was 24). We are both professionals and have double income with no kids and a little savings/retirement money to put down on the house. Some might say that we overdid it. It is 2100 sq ft with 3 bedrooms, 2 full baths, attached 2-car garage, marble and hardwood floors (no granite, although we are considering putting it in some day). Nicer than the house my family moved into when I was 18. Most of the rooms have been remodeled in the last 10 years. BUT... DH and I are both horrible at remodeling and we have no friends who can help us. Hell three years later and I still have a couple rooms unfurnished (embarrassing!). We bought the house for our future needed space, not for current. We didn't want to have to upgrade the home or add on until some point in the future where we could afford to have someone else do it for us. We knew we were a little over our heads the first year of home ownership, but since purchasing it we have both gotten promotions and raises at work, paid some things off, and basically we are doing OK financially now.

In all honesty I don't think we over did it. In the past three years we have been getting used to having three bedrooms worth of space for two people. We are expecting and now we have to try to figure out how to give up one room for the baby. We are not really agreeing on who is going to give up their "space" - me or him. It's looking like it's going to be me, which sucks because "my" room has the walk-in closet and "our" room has no space for all my clothes/shoes etc. Bleh......

 

[lulu]

Thanks for all the comments. I guess I'm not sated yet because I'm recording a few more today. A glutton for punishment!

 

[Dancing Fire]

My daughter got really luck when she bought a like new 2100 sq ft house in the fall of 2011 for $278K. We offered the bank $3K over their asking price and they accepted our offer. Today her house would sell for about $340K.

 

[JewelFreak]

"We bought the house we want forever now, because we plan to have a family & don't want to move again." Common theme. Super, if you have a trust fund or are really good at investing profitably. Or if you bought it for an affordable price, planning to fix it up. Not so super if you went out on a limb with your loan. If these economic times teach us anything, it should be that we never know what's going to happen. Bank on everything just getting better, and you're standing on the edge of a dangerous cliff.

DH & I borrowed only what we could re-pay on one salary, just in case one of us lost a job, even in boom times. It was a bit painful resisting temptation to go higher, but the picture of having to sell was even more agonizing. And damn-all if it didn't happen! His dept. was eliminated & everyone dumped with 2 weeks' notice. Before the downturn. Last thing we expected, but at least one we'd prepared for.

My parents bought a move-up house in their 30s -- okay, but not a dream house. They didn't get that until their late 40s, and even that needed a lot of cosmetic work. It was a fabulous place -- but here again, watch out. My father died suddenly 3 years later. I learned to plan so as to weather hard times. Not to go around afraid of the future, but to realize life has so many bumps & hairpin turns, it's essential to use the noggin. Instant gratification often comes at a high price.

--- Laurie

 

[justginger]

"We bought the house we want forever now, because we plan to have a family & don't want to move again." Common theme. Super, if you have a trust fund or are really good at investing profitably. Or if you bought it for an affordable price, planning to fix it up. Not so super if you went out on a limb with your loan. If these economic times teach us anything, it should be that we never know what's going to happen. Bank on everything just getting better, and you're standing on the edge of a dangerous cliff.

DH & I borrowed only what we could re-pay on one salary, just in case one of us lost a job, even in boom times. It was a bit painful resisting temptation to go higher, but the picture of having to sell was even more agonizing. And damn-all if it didn't happen! His dept. was eliminated & everyone dumped with 2 weeks' notice. Before the downturn. Last thing we expected, but at least one we'd prepared for.

My parents bought a move-up house in their 30s -- okay, but not a dream house. They didn't get that until their late 40s, and even that needed a lot of cosmetic work. It was a fabulous place -- but here again, watch out. My father died suddenly 3 years later. I learned to plan so as to weather hard times. Not to go around afraid of the future, but to realize life has so many bumps & hairpin turns, it's essential to use the noggin. Instant gratification often comes at a high price.

--- Laurie

I'm glad you were well prepared, Laurie - so many people did NOT use their noggins and paid dearly, emotionally and financially.

 

[rosetta]

I would never ever but a house that we couldn't pay off on one salary! Plus we have excellent insurance that would pay off the entire mortgage if the main bread winner dies (heaven forbid) but even then, big mortgages make me very nervous. Anything more than 2x our salaries would be difficult for me to rest easy with

 

[Nyc2chigal]

NOT THIS 20 something YEAR OLD!!!

I'm 27, and the house SO and I purchased had original EVERYTHING when we bought it.

We updated gradually to what I can now call a house straight out of a magazine!



I noticed those pretentious young buyers on that show, and thought "The outdated ceiling fans were the deal breaker?? Really?? "


I think there are a bunch of people from my generation that get into things (marriage, buying a house, etc) without being wise or educated.

Insignificant things are blown up, and important things are never considered.

Things that can be changed shouldn't even be an issue...

The AREA, sewage, integrity of the house, etc. SHOULD BE.

 

[Rhea]

"We bought the house we want forever now, because we plan to have a family & don't want to move again." Common theme. Super, if you have a trust fund or are really good at investing profitably. Or if you bought it for an affordable price, planning to fix it up. Not so super if you went out on a limb with your loan. If these economic times teach us anything, it should be that we never know what's going to happen. Bank on everything just getting better, and you're standing on the edge of a dangerous cliff.

DH & I borrowed only what we could re-pay on one salary, just in case one of us lost a job, even in boom times. It was a bit painful resisting temptation to go higher, but the picture of having to sell was even more agonizing. And damn-all if it didn't happen! His dept. was eliminated & everyone dumped with 2 weeks' notice. Before the downturn. Last thing we expected, but at least one we'd prepared for.

My parents bought a move-up house in their 30s -- okay, but not a dream house. They didn't get that until their late 40s, and even that needed a lot of cosmetic work. It was a fabulous place -- but here again, watch out. My father died suddenly 3 years later. I learned to plan so as to weather hard times. Not to go around afraid of the future, but to realize life has so many bumps & hairpin turns, it's essential to use the noggin. Instant gratification often comes at a high price.

--- Laurie

I understand what you mean, but in some places that's simply not possible. Our rent on a two-bedroom flat in London was nearly 40% of our take home pay at the time that we moved in. London property prices are so sky-high that I can't ever imagine being able to survive without having a partner to help pay. I had a work colleague who inherited £100,000 and had a £29,500 yearly salary and who just has that money in the bank because getting a mortgage was a problem even with that kind of money. I'm no longer at that place of work so don't get updates on his house-hunt as a single person any longer. At the time he was looking for a 1 bedroom, 1 bathroom and hoping for a conversion in a terrace rather than a purpose built flat. My friends who bought 10 years ago were able to do it as individuals but now it really has to be done as a couple.

I'd rather rent and save to have a bigger house to begin with. And I don't mean a 4 bedroom, 2 bathroom detached home on a plot of land. We're saving for a 800 - 900 sq foot, 2 bedroom, 1 bath flat and hoping that we get a balcony! At our ages (29 & 32) and with one of us working from home, and the potential for children sooner rather than later it doesn't make sense to buy the 1 bedroom starter flat that we could afford. Even then it'd still be some place we could afford, not I or him by ourselves. We could probably live in a one bedroom for a couple of years, but we'd probably lose at least £12,000 on the sale of it by the time we paid taxes, fees, and the cost of moving. Stamp duty alone on a £270,000 flat would be £8,100!! That's £8,100 in fees that we never ever see again and add no value to our home. To me, it makes sense to think longer term and get a longer-term home the first time.

A 1 bedroom, 1 bathroom 550 sq foot flat with balcony, in an "up and coming area" near us cost £265,000. We could afford that. I'd prefer to avoid it because the comprehensive schools in that area leave a lot to be desired. It'd still take both salaries to afford it.

I'm not talking dream home here. I'm not talking about plans for a family sometime in the future. I'm talking currently. And that's lots of people's reality, not as spoiled 20-sometimes, but as professional couples with descent jobs living in expensive cities. I honestly can't see the point of buying a 1 bedroom, which we can afford, and cramming DH's only place of work into a living room, never mind the possible child my GP told me I need to be thinking about within the next 2 years because of problems we found out about last year. I'd love to have my own yard and a 3rd bedroom and 2nd bathroom terraced house - but that's dream house! And I hope I can afford that in my 40s!

 

[iheartscience]

I think one major difference between buying a house now and buying a house 50 years ago is that most people marry later and buy later, so many can afford to buy a larger house on 2 salaries. Plus if you don't get married until you're 27 or 28 and you buy a house shortly after, and plan to have kids, it wouldn't make any sense to get a "starter house" and then sell it in a few years. Closing costs aren't cheap! But I also think there's a much greater emphasis on homes in general. HGTV, Pinterest, blogs, etc. didn't exist when my parents were buying. Obviously people shouldn't try to keep up with the Joneses, but that's usually what happens when people are exposed to constant marketing and don't consciously fight it.

I do think it's ridiculous for 2 people to buy a 3000+ square foot house when they're planning on maybe one or two kids. I grew up in a 2600 square foot house with 4 siblings and 2 parents and there was PLENTY of room. We barely used the living room-everyone hung out in the kitchen and the den right off the kitchen.

And I'm not even super "green" but heating and cooling a giant house isn't doing the environment any favors, not to mention the bank account when it comes to paying utilities or maintenance.

 

[Dancing Fire]

I think one major difference between buying a house now and buying a house 50 years ago is that most people marry later and buy later, so many can afford to buy a larger house on 2 salaries. Plus if you don't get married until you're 27 or 28 and you buy a house shortly after, and plan to have kids, it wouldn't make any sense to get a "starter house" and then sell it in a few years. Closing costs aren't cheap! But I also think there's a much greater emphasis on homes in general. HGTV, Pinterest, blogs, etc. didn't exist when my parents were buying. Obviously people shouldn't try to keep up with the Joneses, but that's usually what happens when people are exposed to constant marketing and don't consciously fight it.

I do think it's ridiculous for 2 people to buy a 3000+ square foot house when they're planning on maybe one or two kids. I grew up in a 2600 square foot house with 4 siblings and 2 parents and there was PLENTY of room. We barely used the living room-everyone hung out in the kitchen and the den right off the kitchen.

And I'm not even super "green" but heating and cooling a giant house isn't doing the environment any favors, not to mention the bank account when it comes to paying utilities or maintenance.

Sounds like us.We bought our only house (2350 sq ft) raised 2 kids, and now the eldest daughter had already moved out so there are plenty or room left.

 

[packrat]

The house we have now has three bedrooms, and all three closets in those bedrooms together aren't as big as the closet I had in my room back home. Sometimes you just have to deal, you know? There are five closets, counting those three and the one outside of the bathroom and the coat closet. Those five are about the size of what I used to have. Did we want to live in the country on an acreage? Yes. Could we afford it? No. Did I want to have a house at least as big as the one I grew up in? Yes. Did I get it? Nope. Not by a long shot. Our bedroom and Trapper's bedroom combined is my bedroom at my parents. Sometimes we have to man up and deal w/having less. Would I rather have more? Of course. But, I know people who've had more kids, in smaller houses and somehow managed to not come out of it on the other side unscathed. You do what you gotta do.

We were pretty lame in our wish list. Basement. Attached garage, or space to add one. 3 bedrooms. Everything else can be changed (and most of it has). Lucked out-we're 1.5 blocks from the hospital and elementary school, about 3 from the middle school and preschool where I work now. Around the corner from my gramma, next door to her are my aunt/uncle, and now kitty corner from them are my brother and SIL. Grocery store is right up the street from the middle school. Handy.

After almost 12 years of living here and experiencing home ownership, and having bought a piecea-crap, *if* we moved, we'd have to have enough money to build to our exact specifications, and we'd wait until the kids were older/out of the house b/c of the convenience of town. We'd never in a million years find a place that was move in ready for *us*. Actually, there is one place out in the country that we would do what we could just to get it b/c it is *bad* *ass*. It's the only place that I would make do w/plain white walls or anything plain b/c it is so amazing. My parents and I spent a few years helping w/the landscaping so I've been out there a lot and at least that part I know would be "ready" for us.

 

[madelise]

Perks of being part of a culture with multigenerational living households: You get to get a giant ass house filled with all your loved ones.

Cons: You're never alone.

 

[JewelFreak]

Rhea, I do know what you mean. London prices are insane, as are San Francisco, LA, Tokyo, Paris. It's tough & you can't make the choices people in other areas are able to. DH worked in NYC but living there or even near there meant mucho bucks. I guess it comes down to deciding what trade-offs are bearable -- we bought a house in Conn., which meant a 90-minute door-to-door commute for him. Awful, but he made buds on his train & got work done too, so got sort-of used to it. We loved our 1.5 acres, stone walls, woods & wildlife enough to compensate. For others, it's just not worth it.

In San Francisco we wanted to live in the city -- couldn't buy a small closet for what we had to spend. (Partly because we still owned our Amsterdam flat, so had little for a down payment.) We weren't willing to go for a 5% down risk, so rented for 9 years. I still want to cry, thinking of the appreciation that time would've made on anything we'd bought, but them's the breaks. The out-of-sight cities are a whole different ball game.

--- Laurie

 

[Rhea]

I apologise in advance for the thread-jack.

Laurie - I know what you mean! I'm new to London. For the first 4 1/2 years of our marriage we lived outside London and I put in 3 - 4 hours daily on the train. It started out okay and I was good for the first couple of years. After that our location and me being saddled with the expensive and loss of time spent on a commute caused so many problems that I moved out. I moved to central London where I lived in a shared house for just over a year while DH moved back in with his parents. Financially it was a huge help for us, very inexpensive living Where we live now was a compromise for both of us and because of the ideal location for us both we pay more in rent than we'd like to. But good lord, I'm not going back to commuting. I understand it wasn't just my commute, but was also my feelings about being the only one to make scarifies. DH was happy with where we lived before. It was cheaper and more convenient for him. I moved to another country, earned more, and got stuck with the commute and the difficulty in making friends through work or home because I was always in the wrong place. We discuss moving out of the city someday, but it's not happening within the next few years! The cycle commute to work I have now helps with my depression and our location is ideal for actually keeping in contact with friends from work rather than feeling like the isolated immigrant I can be. Someday we'll move out Right now my mental health and our marriage is thriving in the city

I do hear that's what people do though, move out of the city when they have children. If we decide to do that I'll need to switch jobs. I can't imagine getting home to a child after that type of commute. When we discussed children a long time ago I noted that most nurseries in our area were open 8am - 6pm. I was never home at those times. I left for work at 7am and returned at about 7pm most days. Maybe some nurseries stay open later? I have a very city based job.

May I ask, who is/was the primary care-giver of your children? This is where we get really stuck. I have the regular schedule whereas DH is self-employed and gets last minute work, often getting a call at noon to attend something that evening. I know that he'd have to run more by me if we did have children. But I don't know how to balance any potential children, the longer commute to get the house we could actually afford, and DH's ever-changing schedule. For now, it's not really a problem as we're staying the city and still discussing children, but I'm a planner!

 

[justginger]

I always see the housing prices in London as astronomical, so haven't previously understood why it was never in the rankings of most expensive cities in the world (while Perth regularly fluctuates between about 8-11). Then I found this: http://www.numbeo.com/cost-of-living/rankings_current.jsp

It's really interesting. It looks like rent for London is about 17% higher than Perth, but the indexed cost of living is 18% lower. Somehow that results in Perth being ranked 10th and London being 29th - anyone understand that?

I guess what I want to understand is if that then makes it easier to save for a house? Housing prices are more, but theoretically Londoners should be able to save easier than Perthians. Is it a case that Perth is a relatively lifeless city in comparison, so those in London spend more on social events and outings? I'm trying to equate how it is harder to buy a property in a city with a 20% lower cost of living than where I am, when we can comfortably do it. It's puzzling.