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  #41  
Old Posted Jan 25, 2023, 2:20 AM
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Originally Posted by Chef View Post
Zoning already erodes property rights. As it is we already have tons of laws regulating economic behavior where the right of an individual to maximize profits is curbed to protect the greater interest of society as a whole. Most people aren't libertarian purists when it comes to economic and financial laws. We give up pieces of our freedom so that we can live in a functional society.

Laws preventing Wall Street from becoming America's landlord are probably something most people could be sold on if they think it would be good for the community writ large.
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Originally Posted by Kngkyle View Post
Yep, and that zoning is arguably one of the leading drivers for the lack of new low to middle income housing. Through overly onerous zoning we've made it all but illegal to build anything but luxury housing in many places.
Almost sounds like bad regulations are bad and good regulations are good. I wonder if it would be possible to eliminate the bad ones and keep the good ones? Kind of like with other laws.
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  #42  
Old Posted Jan 25, 2023, 2:52 AM
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Originally Posted by iheartthed View Post
That isn't because there weren't black homeowners. It's because, due to systematic racism, black homeowners weren't able to pass along equity to their descendants.

There were tens of millions of examples of Americans of European descent losing money on homes, rental properties, and farms before the civil rights legislation of the 1960s.
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  #43  
Old Posted Jan 25, 2023, 3:14 AM
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Originally Posted by Kngkyle View Post
Why is "Wall Street" some fictional bogeyman to you? Everyone who has a 401k is "Wall Street".
Saying everyone who has a 401k is wall street is like saying everyone who pays taxes is the government. I think most people understand the term to mean the decision makers.
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  #44  
Old Posted Jan 25, 2023, 3:20 AM
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Originally Posted by JManc View Post
Depends on your income. My grandparents generated more wealth from their home than any savings or retirement. If you don't make a lot, you're probably not going to have much by the time you retire. A 100k doesn't go very far but buying a modest house and spreading the mortgage over 15-30 years is pretty accessible and likely will result in a bigger investment over time.

It's also why many in the black community are further behind the 8 ball in wealth accumulation due to their grandparents/ great-grandparents not having equity to pass on.
I bought my home around the time I started investing in my 401 K.

I owe about $220,000 on my home but it's valued at over $600,000 currently. I anticipate that the value of the house will never dip below what I've actually paid on it. I am looking, right now, at a net gain of almost $300,000 total ($220,000 + the $100,000 or so I've already paid on my mortgage and then assuming I get $600,000 for the house). My current 401K is nowhere near that at this point and the last couple years, I've done max contributions.

But you also have to factor that my mortgage payment would be going to rent anyway and I'm basically paying myself that money long-term if I live here to the length of the mortgage.

But I also understand I am a unique situation, someone who was able to get a house when it was economically viable. Going forward, I don't know how viable this could ever be. The thing is, my mortgage is less than what I would likely be paying in rent unless I went and got a very small studio apartment. And that doesn't stop rents surging. My mortgage may fluctuate based on taxes and escrow misses - but it's not going to do so consistently. What I'm paying today is not going to be dramatically different than what I paid last year. But renting? Good luck. You're at the whim of your complex and you may see a significant increase.

And, of course, you don't get all that money back.
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  #45  
Old Posted Jan 25, 2023, 3:38 PM
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Originally Posted by Comrade View Post
I bought my home around the time I started investing in my 401 K.

I owe about $220,000 on my home but it's valued at over $600,000 currently. I anticipate that the value of the house will never dip below what I've actually paid on it. I am looking, right now, at a net gain of almost $300,000 total ($220,000 + the $100,000 or so I've already paid on my mortgage and then assuming I get $600,000 for the house). My current 401K is nowhere near that at this point and the last couple years, I've done max contributions.

But you also have to factor that my mortgage payment would be going to rent anyway and I'm basically paying myself that money long-term if I live here to the length of the mortgage.

But I also understand I am a unique situation, someone who was able to get a house when it was economically viable. Going forward, I don't know how viable this could ever be. The thing is, my mortgage is less than what I would likely be paying in rent unless I went and got a very small studio apartment. And that doesn't stop rents surging. My mortgage may fluctuate based on taxes and escrow misses - but it's not going to do so consistently. What I'm paying today is not going to be dramatically different than what I paid last year. But renting? Good luck. You're at the whim of your complex and you may see a significant increase.

And, of course, you don't get all that money back.
How long ago did you purchase your house?
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  #46  
Old Posted Jan 25, 2023, 4:11 PM
jmecklenborg jmecklenborg is offline
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Originally Posted by Nouvellecosse View Post
Saying everyone who has a 401k
The entire population of the United States has access to the same stock market. All 401k accounts operate pretty much the exact same way, with the two major deviations being traditional/Roth, then the character of the employer match being another factor (percentage + vesting period).

The value of real estate is, by contrast, almost entirely local. There are some national laws that all lenders must adhere to, plus federal stuff like FHA, Fannie, Freddie, etc., plus an interest rate that is generally the same nationwide, but again, the value of property is local.

So blanket statements like "home ownership is your greatest wealth-building tool" just plain aren't accurate. And if it were easy to predict where the most appreciation will occur in the next 20-30 years, then everyone would be doing it. It's obviously impossible for all 300+ million Americans to physically reside in those specific areas that a crystal ball informs them will appreciate 10X in value in the next 30 years.

This means there will be winners and there will be losers but there is no way to predict who those people and places will be right now.

What the progressive left means by "equality" is equality of outcomes, not equality of opportunities. They say they want everyone to have the chance to buy a home because they want everyone to enjoy appreciation, but giving everyone that chance, as occurred in the 1990s, illustrated the first law of planet earth, which is that equal opportunity = unequal outcomes.

Last edited by jmecklenborg; Jan 25, 2023 at 4:42 PM.
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  #47  
Old Posted Jan 25, 2023, 5:19 PM
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not living in a sexy high cost city, the true benefits of home ownership to me transcend investment potential.

stability: as long as i live up to my end of the bargain with the mortgage payments, no one can kick my family out of our home. as our neighborhood continues to get wealthier around us, no landlord can ever jack the rent on us or sell the bulding to a new owner who might force us to move out of our community*. the value of that peace of mind is immeasurable when you're raising a family, IMO.

predictability: unlike rent, which only ever seems to increase over time, my mortgage payments will be exactly the same in 20 years as they are today. yes, property taxes will always only ever go up, but the base payment of my 30 year fixed loan will never change.

pride: because i own it, i take much greater care of my home than i ever did with any of the rental properties that i lived in when i was younger. not that i was some wreckless savage who intentionally destroyed other people's property, but when something is yours, you simply care more about it and take better care of it.

customization: because my home is mine, if i want to make changes to improve it or otherwise better suit my needs/desires, i don't have to seek the approval of some landlord who may not be on board with my plans. if i wanna redo a bathroom, boom, i redo a bathroom. i'm not at anyone else's mercy.



there probably are better investments than buying a home (in most markets), but for all of the intangibles listed above, especially when it comes to family raising, i would never again want to be subject to the vagaries of the rental game. i enjoy calling my own shots way too fucking much.

besides, i think you'd be hard-pressed to find many financial planners who would say that home ownership, as ONE piece of a diversified investment strategy, is a bad idea in general.



(*) that exact situtation happened to our old neighbors across the street from us. they were tenants in a 2-flat and the landlord sold the building at the market peak last spring, and the new owner wouldn't renew the existing leases because they were going to occupy one of the units, and their family member was going to occupy the other, so our old neighbors very reluctantly ended up moving to a new apartment flat about 1/2 mile north of us. needless to say, we don't see them much anymore, sadly.
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Last edited by Steely Dan; Jan 25, 2023 at 8:58 PM.
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  #48  
Old Posted Jan 25, 2023, 5:27 PM
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A house I recently looked at to purchase was previously listed over the summer/fall of 2022, but then disappeared, presumably because it sold. When I saw the house last week, it did sell in the fall..to an investment firm. They're now trying to sell it for $10,000 more than what they paid, without NO improvements to the house, and it needs plenty. It's not moving at all, my agent said there have been two showings in the past two weeks since it relisted.

Fuck these nameless/faceless corporate entities buying homes in bulk and trying to flip them for a profit, while doing absolutely nothing to improve their conditions. I hope they all go bankrupt this year.
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  #49  
Old Posted Jan 25, 2023, 5:29 PM
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Originally Posted by sentinel View Post
A house I recently looked at to purchase was previously listed over the summer/fall of 2022, but then disappeared, presumably because it sold. When I saw the house last week, it did sell in the fall..to an investment firm. They're now trying to sell it for $10,000 more than what they paid, without NO improvements to the house, and it needs plenty. It's not moving at all, my agent said there have been two showings in the past two weeks since it relisted.

Fuck these nameless/faceless corporate entities buying homes in bulk and trying to flip them for a profit, while doing absolutely nothing to improve their conditions. I hope they all go bankrupt this year.
Talk about bad timing lol.
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  #50  
Old Posted Jan 25, 2023, 5:36 PM
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Originally Posted by jmecklenborg View Post

What the progressive left means by "equality" is equality of outcomes, not equality of opportunities. They say they want everyone to have the chance to buy a home because they want everyone to enjoy appreciation, but giving everyone that chance, as occurred in the 1990s, illustrated the first law of planet earth, which is that equal opportunity = unequal outcomes.
In fact, it was the right that was pushing homeownership for all Americans in the years before the Great Recession rather than the "progressive left." Remember George W. Bush's Ownership Society? He thought homeownership would turn blacks and Latinos into Republican voters. Fed Chairman Greenspan, certainly no leftist, made speeches encouraging homeowners to sign up for HELOCs to take advantage of the relatively low interest rates of the time. Turn your bungalow into a financing vehicle for a new SUV! To the extent that there was an economic boom during the W administration, it was driven by the real estate bubble and all the construction and added consumer spending accommodated by rising real estate prices.

When that bubble finally burst, I recall Republicans blaming it all on Jimmy Carter's attempts to increase homeownership among blacks and Latinos. Not Bill Clinton. There was apparently a Carter-era program initiated for that purpose, and it served as a convenient scapegoat to deflect blame from the Wall Street shenanigans and laissez faire government oversight of lending practices that were the real causes of the real estate debacle. Non-white homeowners only comprised a minority of those in default on their loans, and presumably most of them did not fall into homeownership as a result of a 1970s government program, so the Jimmy Carter is to Blame theory seemed wrong to me.

And no, homeownership is not necessarily the most efficient vehicle for wealth generation, but in practical terms for most Americans it probably is. How many Americans who rent all their lives manage to accumulate significant savings? I would guess very few. Most Americans will not get rich by owning a home. But doing so does provide a substantial measure of economic security. If you have a fixed rate mortgage, you've shielded a major part of your living expenses from inflation. If you manage to pay off your mortgage you own an asset that you can live in rent free or sell or leave to your heirs. Plus the need to make the monthly mortgage payment ensures a level of financial discipline that many Americans otherwise lack. It's a forced savings program. And yes, these benefits vary depending on which part of the country you live in based on how much property values and rents rise. I imagine the benefits are higher in Southern California than Southwestern Ohio.

I often read (including in the comments here) that concerns about investor purchases of residential real estate are overblown. It certainly does look like a trend to me. If it continues to grow it will be yet another factor exacerbating wealth inequality, which we have enough of already.
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  #51  
Old Posted Jan 25, 2023, 6:24 PM
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How many Americans who rent all their lives manage to accumulate significant savings? I would guess very few.
I agree that whatever that percentage is, it's quite small, but it's not because they're renting - it's because they never had a moment where they got organized, read a few books, crafted a plan, and stuck to it.

Part of the "education" problem is that teachers are very often in traditional pension plans, meaning they're not in the 401k/independent IRA world that the majority of the US population operates in. Someone who begins teaching in their early 20s and sticks with it typically retires with a very comfortable pension, with annual benefits well in excess of $50k.

Few people outside of teaching and other public realms (police/fire/etc.) are forced to contribute 9%, or whatever, toward their retirements from Day 1. This is a big reason why pensions "work".

Many people have observed that attending graduate school for 2-4 years is a gigantic financial mistake because students are usually sliding into steep debt during years when they could be contributing to 401ks.


Quote:
Plus the need to make the monthly mortgage payment ensures a level of financial discipline that many Americans otherwise lack.
A lot of people walked away from their upside-down homes in 2011, 12, 13. The purchase of a home can but does not ensure that someone will become more financially literate and responsible.


Quote:
It's a forced savings program. And yes, these benefits vary depending on which part of the country you live in based on how much property values and rents rise. I imagine the benefits are higher in Southern California than Southwestern Ohio.
But nobody who bought a house in LA in the 1970s had any idea that their $100k home would come to be worth $1 million in 2020 whereas that same $100k home in Ohio purchased in 1970 was worth less in 2010 and maybe $150k in 2020.
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  #52  
Old Posted Jan 25, 2023, 6:56 PM
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Originally Posted by sentinel View Post
A house I recently looked at to purchase was previously listed over the summer/fall of 2022, but then disappeared, presumably because it sold. When I saw the house last week, it did sell in the fall..to an investment firm. They're now trying to sell it for $10,000 more than what they paid, without NO improvements to the house, and it needs plenty. It's not moving at all, my agent said there have been two showings in the past two weeks since it relisted.

Fuck these nameless/faceless corporate entities buying homes in bulk and trying to flip them for a profit, while doing absolutely nothing to improve their conditions. I hope they all go bankrupt this year.
Had to remember where I saw this, but hold that last thought lol:

Quote:
In June 2021, Zillow owned 50 homes in California’s capital, Sacramento. Five months later, it had 400. One was an unremarkable four-bedroom, three-bath house in the northwest corner of the city. Built in 2001, it is convenient to several parks and the airport. Zillow paid $700,000 for it.

Zillow put the house on the market for months, but no one wanted it, even at $625,000. Last fall, after it had unceremoniously exited the flipping market, Zillow unloaded the house for $355,000. Low rates had made it seem possible that Zillow could shoot for the moon, but even they could not make it a success.

https://www.nytimes.com/2023/01/23/t...s-layoffs.html
Zillow lost $345,000 on one house, or about the cost of a senior developer for 1 year in the Bay Area.
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  #53  
Old Posted Jan 25, 2023, 6:57 PM
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Anyone else get hammered with unsolicited texts and calls wanting to buy your house? I must get at least a dozen everyday.
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  #54  
Old Posted Jan 25, 2023, 7:11 PM
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Anyone else get hammered with unsolicited texts and calls wanting to buy your house? I must get at least a dozen everyday.
Yes, though not that frequently. When they come as texts or messages on my cellphone I block the sender. That seems to have reduced the frequency I get them over time. I think I've got at least 20 blocked callers on my cellphone.
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  #55  
Old Posted Jan 25, 2023, 7:50 PM
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Originally Posted by JManc View Post
Anyone else get hammered with unsolicited texts and calls wanting to buy your house? I must get at least a dozen everyday.
Yes, and the fact that they are calling tells me they desire the property to rent out. I vowed, unless under extreme circumstances, I will only sell to someone who intends on living in the house.
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  #56  
Old Posted Jan 25, 2023, 8:48 PM
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Originally Posted by Steely Dan View Post
not living in a sexy high cost city, the true benefits of home ownership to me transcend investment potential.
Me too and I know it's shocking....
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Originally Posted by JManc View Post
Anyone else get hammered with unsolicited texts and calls wanting to buy your house? I must get at least a dozen everyday.
For my parents place somehow but not mine, since my area still might be considered undesirable for a few reasons. These places might be eyeballing all the trailer parks, though - now those are a huge scam!
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  #57  
Old Posted Jan 25, 2023, 8:59 PM
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Originally Posted by jmecklenborg View Post
There were tens of millions of examples of Americans of European descent losing money on homes, rental properties, and farms before the civil rights legislation of the 1960s.
What does this have to do with black folks not being able to buy housing property? These whataboutisms really defect from the real issues that should be confronted.
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  #58  
Old Posted Jan 25, 2023, 9:02 PM
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What does this have to do with black folks not being able to buy housing property? These whataboutisms really defect from the real issues that should be confronted.
Hmm, owning rental properties or being excluded from purchasing homes in the first place...
One of these is not like the other.
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  #59  
Old Posted Jan 25, 2023, 9:31 PM
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Hmm, owning rental properties or being excluded from purchasing homes in the first place.
One of these is not like the other.
Exactly, one may have to refer to the history books, but "redlining' was a real thing...
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  #60  
Old Posted Jan 25, 2023, 10:12 PM
jmecklenborg jmecklenborg is offline
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Originally Posted by jd3189 View Post
What does this have to do with black folks not being able to buy housing property?
The problem is the insinuation that the continued economic condition of black Americans as it exists in 2023 is tied to circumstances from over 60 years ago.

Meanwhile, Asian Americans, a demographic that barely existed numerically in the 1960s, now earns and owns significantly more per capita than white Americans.

The numbers:
https://en.wikipedia.org/wiki/List_o...usehold_income


Virtually all of the wealth in the United States has been generated in recent decades. We are exponentially more productive and wealthier in 2023 than we were during the 1960s. The GDP reached $1 trillion for the first time in 1970. It is now in excess of $20 trillion.
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