Quote:
Originally Posted by City Wide
your earlier comment is largely why I asked the question about sub $1M condos. I picked the $600K to $900K out of the air; it seemed like a price point that is at or just above what a lot of houses are selling for.
Frankly I don't understand how most people can buy a $700K home, regardless of what name bracket they are in. Where does the down payment and closing costs come from, about $100K. And to carry a $500K to $600K mortgage even at todays low rates might require a $100K++ a year job, min. But I'm still trying to figure out what happened to nickel and dime candy bars
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Two incomes (couple/partnership), a side hustle, maybe a rental property. Living under your means.
It adds up.
I've done a lot of research on who's buying the expensive homes in Northern Liberties ($700K+). To be frank, at least in Northern Liberties, probably 25% of the occupants are doctors. But there are also a lot of executives, consultants, and business owners. Point being, it's probably too expensive at this point for a first time home buyer, unless you buy one of the smaller older homes and are willing to have roommates.
Years ago, when I was 25, I scrapped together a down payment and bought a small house in Northern Liberties because I couldn't afford Old City or Queen Village. Believe me, in spite of what old timers would say, there was nothing there. Literally, the only businesses on 2nd Street at the time were 1. 700 Club (which is how I even knew about the neighborhood, because I loved to party there with my friends) 2. Architectural Antiques Exchange and 3. Standard Tap (which was a significant indicator to me of where the neighborhood would go).
I guess I could have sold that house and rolled the equity into another house, but when I moved to NY for work, I kept it and rented it out. The rent it demands is $1000 more per month than my mortgage (which will be paid off in 7 years).
Last year I bought another house in Germantown (thinking the neighborhood was way underpriced) to slowly rehab and hold. Also as a place to stay when I'm in Philly, which is sometimes every weekend bc NoLibs is occupied. Comps in the neighborhood that have sold recently show my investment has already doubled.
In NY, I live in a rent stabalized apt that I found 6 years ago in an area that wasn't yet hip. All of my friends thought I was crazy, but I knew I needed to lock in a low rent if I had any chance of surviving in NYC for the long term and to save enough money to live here (i.e. buy down the road). Now my apt is being rented in the same building for twice what I pay, and my rent hasn't gone up in 6 years.
There's always an angle. It usually requires you not living, at least initially, where you'd really want to live, but I'm also a person who feels a connection to places where I can be actively involved in improving it.
Anyway...my point is, it's about hustle. Even if you don't think you have the means, you can figure it out. If you live alone, for example, get roommates and pay $450 or $500 a month in rent for 4-5 years so you can save a down payment. Then buy a house in a place that is just starting to percolate.
If I were young with a long time line and buying today, I'd buy in Grays Ferry, Harrowgate, far West Philly (i.e. Cobbs Creek), or Tacony. I'd even consider West Kensington or better blocks in Strawberry Mansion. Or even the parts of Wissinoming and or Mayfair that are walking distance to the end of the El. That's how you build equity. And once you have it, it's a powerful multiplier. It gives you better credit, access to equity, etc. Then you take that equity and roll it over, etc, tap it to buy another place. Whatever. Houses are safer than condos, etc.
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