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Out of curiosity I looked for the house that couple is selling. Believe it's this: https://www.zillow.com/homedetails/30206-Telluride-Ln-Evergreen-CO-80439/1375

by annodomini2019 1y ago

Out of curiosity I looked for the house that couple is selling. Believe it's this: https://www.zillow.com/homedetails/30206-Telluride-Ln-Evergreen-CO-80439/13756682_zpid/ https://www.zillow.com/homedetails/30206-Telluride-Ln-Evergr... Notice the price history. 83k in '97, which is about 170k now. Being sold for a 10x profit. Sigh.

fvrghl 1y ago
If you had invested the 83k in the S&P500, you'd be slightly ahead I think if you include maintenance and property taxes. https://www.in2013dollars.com/us/stocks/s-p-500/1997?amount=83000&endYear=2025 https://www.in2013dollars.com/us/stocks/s-p-500/1997?amount=...
- bobbiechen 1y ago
  If you count the S&P 500, you should also count 20+ years of rent, right?
- annodomini2019 1y ago
  You don't get to live in the S&P500. Also don't really get the point of this response. Both just prove assets are wildly out of reach for young people now compared to then.
- munksbeer 1y ago
  What about if you had 8k as a deposit only, so you either invest in S&P500 and rent instead, or put the deposit on a house and repay the mortgage? That's the more equivalent scenario.
- myvoiceismypass 1y ago
  Most people are putting up 5-20% of the purchase price, so closer to ~16k -> ~225k after 28 years.
kmeisthax 1y ago
There's a couple of factors that make selling at a profit but below "market value" unattractive to people who should be putting their housing back on the market: 1. $83k is not the total cost of ownership; it's just the loan balance. Just looking at a home mortgage calculator, the out-of-pocket costs of buying an $83k home at the historical interest rate of 1997, which was about 7.6%, is about $363k[0]. 2. Homelessness is a crime in most states, so housing becomes a natural short position that everyone has to cover, just like taxes. Outside of estate sales, it is very rare for a home seller to not also be a home buyer. The monetary value of the home is, for them, a way to accelerate and account for what would otherwise be a barter transaction. So if you're expecting to have to buy a home for a million dollars, and you've already spent $350k on the loan, then $1.2 million means you'd be about $150k in the negative, not counting closing costs and moving costs, compared to doing nothing. The $1.3m asking price is close to break even for people who aren't planning on dying anytime soon. [0] I used this calculator: https://www.calculator.net/mortgage-calculator.html?chouseprice=83%2C000&cdownpayment=20&cdownpaymentunit=p&cloanterm=30&cinterestrate=7.6&cstartmonth=9&cstartyear=2025&caddoptional=1&cpropertytaxes=1.2&cpropertytaxesunit=p&chomeins=1%2C500&chomeinsunit=d&cpmi=0&cpmiunit=d&choa=0&choaunit=d&cothercost=4%2C000&cothercostunit=d&cmop=0&cptinc=0&chiinc=0&choainc=0&cocinc=0&cexma=0&cexmsm=9&cexmsy=2025&cexya=0&cexysm=9&cexysy=2025&cexoa=0&cexosm=9&cexosy=2025&caot=0&xa1=0&xm1=9&xy1=2025&xa2=0&xm2=9&xy2=2025&xa3=0&xm3=9&xy3=2025&xa4=0&xm4=9&xy4=2025&xa5=0&xm5=9&xy5=2025&xa6=0&xm6=9&xy6=2025&xa7=0&xm7=9&xy7=2025&xa8=0&xm8=9&xy8=2025&xa9=0&xm9=9&xy9=2025&xa10=0&xm10=9&xy10=2025&csbw=1&printit=0&x=Calculate https://www.calculator.net/mortgage-calculator.html?chousepr...

fvrghl 1y ago

If you had invested the 83k in the S&P500, you'd be slightly ahead I think if you include maintenance and property taxes. https://www.in2013dollars.com/us/stocks/s-p-500/1997?amount=83000&endYear=2025 https://www.in2013dollars.com/us/stocks/s-p-500/1997?amount=...

bobbiechen 1y ago
If you count the S&P 500, you should also count 20+ years of rent, right?
annodomini2019 1y ago
You don't get to live in the S&P500. Also don't really get the point of this response. Both just prove assets are wildly out of reach for young people now compared to then.
munksbeer 1y ago
What about if you had 8k as a deposit only, so you either invest in S&P500 and rent instead, or put the deposit on a house and repay the mortgage? That's the more equivalent scenario.
myvoiceismypass 1y ago
Most people are putting up 5-20% of the purchase price, so closer to ~16k -> ~225k after 28 years.

kmeisthax 1y ago

There's a couple of factors that make selling at a profit but below "market value" unattractive to people who should be putting their housing back on the market: 1. $83k is not the total cost of ownership; it's just the loan balance. Just looking at a home mortgage calculator, the out-of-pocket costs of buying an $83k home at the historical interest rate of 1997, which was about 7.6%, is about $363k[0]. 2. Homelessness is a crime in most states, so housing becomes a natural short position that everyone has to cover, just like taxes. Outside of estate sales, it is very rare for a home seller to not also be a home buyer. The monetary value of the home is, for them, a way to accelerate and account for what would otherwise be a barter transaction. So if you're expecting to have to buy a home for a million dollars, and you've already spent $350k on the loan, then $1.2 million means you'd be about $150k in the negative, not counting closing costs and moving costs, compared to doing nothing. The $1.3m asking price is close to break even for people who aren't planning on dying anytime soon. [0] I used this calculator: https://www.calculator.net/mortgage-calculator.html?chouseprice=83%2C000&cdownpayment=20&cdownpaymentunit=p&cloanterm=30&cinterestrate=7.6&cstartmonth=9&cstartyear=2025&caddoptional=1&cpropertytaxes=1.2&cpropertytaxesunit=p&chomeins=1%2C500&chomeinsunit=d&cpmi=0&cpmiunit=d&choa=0&choaunit=d&cothercost=4%2C000&cothercostunit=d&cmop=0&cptinc=0&chiinc=0&choainc=0&cocinc=0&cexma=0&cexmsm=9&cexmsy=2025&cexya=0&cexysm=9&cexysy=2025&cexoa=0&cexosm=9&cexosy=2025&caot=0&xa1=0&xm1=9&xy1=2025&xa2=0&xm2=9&xy2=2025&xa3=0&xm3=9&xy3=2025&xa4=0&xm4=9&xy4=2025&xa5=0&xm5=9&xy5=2025&xa6=0&xm6=9&xy6=2025&xa7=0&xm7=9&xy7=2025&xa8=0&xm8=9&xy8=2025&xa9=0&xm9=9&xy9=2025&xa10=0&xm10=9&xy10=2025&csbw=1&printit=0&x=Calculate https://www.calculator.net/mortgage-calculator.html?chousepr...