Me_irl : me

[–] Fisherswamp@programming.dev 47 points 1 week ago (3 children)

Let's break this down. Plugging these numbers into a mortgage calculator, yes a $600,000 home with a 3% interest rate would be a payment of ~$2024/month. However, this assumes a 20% down payment, $0 property taxes, $0 insurance, $0 HOA etc.

However, an 850k house at an 8.5% interest rate with those same numbers would "only" be $5228/month. Additionally, as other commenters have pointed out, interest rates are not that high.

OP is straight up lying to you at worst, or just cherry picking numbers in a very deceiving way at best.

Not that I'm trying to argue housing is affordable. Just that people will go on the Internet and tell lies to spin a narrative and drive engagement.

[–] BeMoreCareful@lemmy.world 7 points 1 week ago

Donald Trump wants the interest rates to go down, so wealthy people can have more free money.

[–] CorrectAlias@piefed.blahaj.zone 5 points 1 week ago (3 children)

I agree. But I do wish more people knew about USDA loans in the US, it was the only way I could initially buy my home because it means you can put any amount down, even 0% if you so desire. It allowed me to lock in a low rate (3.2%) in 2021.

The catch is that you must not be in an incorporated city or town, and income limits apply (based on your area's COL).

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[–] dparticiple@sh.itjust.works 42 points 1 week ago (2 children)

Point taken, but where are you in the world with an 8.5% mortgage? Rates in the US for 30 year mortgages are around 6.5% right now (source: https://fred.stlouisfed.org/series/MORTGAGE30US)

[–] barkingspiders@infosec.pub 49 points 1 week ago* (last edited 1 week ago) (1 children)

the baseline is around 6.5% but I don't think most people get that, plus it was up around 7.5% six months ago

the numbers in the meme are definitely closer to what we've seen recently

[–] toynbee@piefed.social 9 points 1 week ago (55 children)

When I bought my first house - doing so with decent income but pretty bad credit - I did so at 6.25%.

Everyone in the room recoiled at such an apparently high number.

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[–] schwim@piefed.zip 10 points 1 week ago (1 children)

Nowhere but then the infographic would have been less shocking.

https://www.globalpropertyguide.com/mortgage-interest-rates

[–] dparticiple@sh.itjust.works 20 points 1 week ago (2 children)

My math says that the monthly principal+interest on that house is more like $4,300 a month, assuming:

Purchase price: $850,000
Down payment (20%): $170,000
Loan amount: $680,000
Interest rate: 6.5% fixed
Term: 30 years (360 months)

Not insignificant, but not wildly off like the infographic.

[–] thallamabond@lemmy.world 11 points 1 week ago (1 children)

You gotta roll home owners insurance in there, and taxes.

[–] dparticiple@sh.itjust.works 12 points 1 week ago (2 children)

That's realistic, but the infographic doesn't include tax and insurance. Working backwards, it has:

Home price: $600,000
Down payment (20%): $120,000
Loan amount: $480,000
Interest rate: 3.0% fixed
Term: 30 years (360 months)

The monthly principal-and-interest payment is exactly as the post said, $2024 / month.

Has insurance gone up? Absolutely? Have property taxes generally rise? They have. But this is an honest like-for-like comparison.

[–] Blum0108@lemmy.world 8 points 1 week ago (2 children)

Who has 120k lying around for a down payment?

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[–] ZombiFrancis@sh.itjust.works 6 points 1 week ago (1 children)

$2024 > $4300 is more than double, while also assuming saving an extra $50,000 in downpayment while that cost increased.

Although the down payment has less impact. But nonetheless, that lower payment boosts the loan to about $4600.

Wages aren't doubling.

[–] dparticiple@sh.itjust.works 3 points 1 week ago

Oh, I agree with you, and concur with the spirit of the infographic. I just like accurate calculations!

[–] BCsven@lemmy.ca 6 points 1 week ago (1 children)

We don't do 30 years here anymore. Its 25, and most people can't do the 20% down, its 5% for first time homebuyer

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[–] Spacehooks@reddthat.com 27 points 1 week ago (9 children)

Can Also be titled why birth rates are low or why no one has spending money and sooo much more

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[–] mochisuki@lemmy.world 25 points 1 week ago (3 children)

Gary’s Economics has as usual many great videos about this

https://youtu.be/BJcpgg6-hNA

It sucks because this ridiculous setup distorts everything about the economy and benefits no one except banks and the rich

[–] Asafum@lemmy.world 11 points 1 week ago

and benefits no one except banks and the rich

Ah, so you mean a typical Tuesday on earth. :/

[–] Diplomjodler3@lemmy.world 6 points 1 week ago (1 children)

Gee, I wonder how that came about.

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[–] Imgonnatrythis@sh.itjust.works 3 points 1 week ago

On the bright side, banks and the rich finally having their day in the sun!

[–] kibblebits@quokk.au 18 points 1 week ago

Now do 2016

[–] plz1@sh.itjust.works 16 points 1 week ago (2 children)

Those numbers are so not reality. $2K/month is nowhere near the payment for the first one.

[–] julysfire@lemmy.world 7 points 1 week ago (1 children)

It could be. The very key thing that is left out of both is the down payment amount

[–] Tolos@lemmy.world 6 points 1 week ago (2 children)

600k at 3%, you need 229k down (38%) to pay $2,025/mo (assuming extremely low property tax and insurance).

850k at 8.5%, you need 40k down (4.71%) to pay $6,850/mo (assuming extremely low property tax and insurance).

40k seems like a much more reasonable down payment....

The 600k house at 3% with 40k down would be $2,821/mo. Almost $4k/mo difference from the 850k example.

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[–] LovableSidekick@lemmy.world 3 points 1 week ago* (last edited 1 week ago) (3 children)

It's $2028/mo. Think before you say these things, Mitch.

[–] RagingRobot@lemmy.world 3 points 1 week ago

Yeah I had a 300k house at 3% was around 2k

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[–] Bluefalcon@discuss.tchncs.de 15 points 1 week ago

Both are heavily overpriced.

[–] zaphod@sopuli.xyz 15 points 1 week ago

It would take about 45 years to pay off the house with the monthly payment on the left. The one on the right for some reason randomly increases the monthly payment so that you'd pay off the house in around 24 years.

[–] RedGreenBlue@lemmy.zip 11 points 1 week ago* (last edited 1 week ago)

Well, the banks can't be loaning just anyone money for a home. They need that capital to be able to give loans to billionares, so they can fund their lifestyle and allow them to avoid paying any taxes.

[–] over_clox@lemmy.world 9 points 1 week ago

These days, you gotta have good credit to get a cardboard box..

/s, maybe 🤷

[–] mlg@lemmy.world 8 points 1 week ago (1 children)

Made from the finest in cardboard material that every builder has assured me has the same structural quality as brick.

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[–] auzy1@lemmy.world 8 points 1 week ago

Here in Australia, they just changed a lot of the tax laws. Every shonky house investor out there is freaking out telling everyone how important they are and we'll fail without them lol

[–] Sir_Premiumhengst@lemmy.world 6 points 1 week ago

Only 850k? What's the catch, is the house in North fucking Dakota?

[–] bridgeburner@lemmy.world 6 points 1 week ago (2 children)

I still wonder why US houses are so expensive? I mean they are basically just a couple plywood planks slapped together, what can be so expensive about that?

[–] NerdyTimesOrWhatever@lemmy.today 11 points 1 week ago

Well, when 5 people own all the houses and all the land they can jack up the price and leave the houses empty.

[–] FlexibleToast@lemmy.world 5 points 1 week ago (2 children)

Supply and demand. The 2008 financial crises crushed perspective home home owners and rightfully made it harder to purchase homes for people with low credit. The demand for construction slowed/stopped driving many construction businesses out of business. Now we don't have enough supply or enough construction to meet the supply. Somewhat ironically rents and prices are so high that it is economically viable to start building again. Many new apartments are being built now and for the first time in a very long time rents actually flatlined.

Beyond this there were also issues that made the problem even worse. Land lords started using the same tools to determine rent and even though they weren't directly colluding, in effect they were through the tools. Also Blackstone started buying up as much property as it could during the low interest rates during covid.

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[–] trxxruraxvr@lemmy.world 4 points 1 week ago (1 children)

A house of that size would probably go for over a million euros here

[–] prenatal_confusion@feddit.org 3 points 1 week ago

Deepening on what "here" means but us houses are built like room dividers here in Germany. No hate (okay, a little hate) but objectively there is a reason for that price difference just based on the materials and cost of work.

me_irl