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Discussion Starter #1
Does it really exist? There is no way I can afford a house, though I think a make an okay salary. If I wanted a house in a safe neighborhood, I would have to move from the West Coast. Can anyone really afford to buy a house? These are the numbers for my area -

Estimated median household income in 2007: $51,391 (it was $47,863 in 2000)

Beaverton: $51,391
Oregon: $48,730


Estimated median house or condo value in 2007: $323,700 (it was $186,100 in 2000)
Beaverton: $323,700
Oregon: $257,300


Based on these numbers, would these people actually qualify to buy a house on their own? Isn't it something like 2-1/2 to 3 times your salary determines how much you supposedly can afford?

How many people had help buying their house, i.e., parents, etc.?
 

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I guess it depends on the area you live in. Here, in Mississippi, $300k will get you a mansion. Most middle class houses run in the 100-200k range. You can find decent homes in the 70-80k range though.

If you go into the rural areas, you can get steals. My parents got their newly remodeled 2800 sq ft. home, 20 acres of land with two ponds, for less than 80k because they live about 20 minutes from the "city" (there's no real cities around here so that's why the quotes are there, lol).
 

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My parents loaned us the down payment, but we qualified for the entire loan amount on our own. They look at the debt to income ratio or something like that to determine what you are eligible for, but we also used stated and unverified income (because we wanted to be able to count my financial aid, which helps to pay the mortgage) which raises the interest rate a little bit. I don't think they even use that anymore. When we bought our home, the asking price was $335,000, but now with the current market status its value is only an estimated $250,000. We already lost our down payment, which is why we could never afford to move into a different home right now. But boy would I have loved to be house shopping in this market for the first time, because if you have the down payment and can get qualified, the prices are right in Phoenix right now (which is also the #3 city for foreclosures in the country currently).
 

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To me the problem is that nobody puts down 20% anymore. You put down 20% on any of your numbers and all of a sudden that house isn't so far out of reach.

My parents saved for 10 years to get that 20%. They didn't feel they were automatically entitled to be home owners. They had no TV, Mom claims they went out for dinner one time a year on their anniversary, one used car, they went tent-camping for vacations, Dad had two suits for work and ate the lunch Mom packed for him everyday. They didn't see a movie for 10 years. Every penny went to saving for that 20% down.

How many people are willing to do that anymore? Not a lot. And who says you are supposed to start with the median house? Everybody I know seems to think they get to start off in a house that is similar to the ones their parents ended up with. They don't want to start in the crappy starter home that their Moms and Dads started with.

Yes there is affordable housing. But it's going to take awhile and it's not going to have granite countertops.
 

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In North Texas, you can get a lot of house for not a lot of money. I have a fairly modest home for my area. We practically live in the ghetto...ha! It's our starter home that we're still in 7 years later....and will be in for quite a bit longer. We'll likely stay here until our child support payments stop. But ... once the CS payments stop, we probably won't need a bigger house so who knows how long we'll stay in our starter home...lol.

We didn't have help. There's no one to help us.

(edited to add that WE pay CS. I worded my post poorly and it sounds like we receive CS. We actually pay $1200 per month)
 

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"Affordable Housing" is a pretty subjective term. In a place like Vancouver, the prices are very high, so people are getting creative. Local government is very slowly waking up to the need for creative solutions to housing and are looking more seriously at different types of infill housing. Look at my own house fopr example:

http://northvancouvermodern.blogspot.com/

This is an example of infill housing designed to make home ownership in the City affordable for me and my parents. We bought a small bungalow in a neighborhood we like that was zoned to allow for two units to be built. So a duplex gets built instead of a single-family home on the same sized city lot. So now my parents and I have homes for less than the cost of buying two detached homes in this neighborhood (and less than the cost of two condos in some instances). Still, not so affordable for me, so I applied for re-zoning to allow me to turn my basement into a rentable suite. Now, I will have a new home that I can afford and my parents will also have a new home that they can afford. The bonus for me, for very little investment, is an income property that will help me pay my mortgage. If I get into a pinch, I can move into the basement suite and rent the main part of the house for a rent that would pay most of my mortgage.

City governments are finally waking up to solutions such as this. They are also looking at lane housing, like carriage houses or garage conversions, etc. The types of affordable housing solutions are only limited by the imagination and the willingness of local government to explore them. Infill housing is typically more affordable housing. Suburbs and sprawl are counterproductive to affordable housing because they rely upon new infrastructure (roads, sewers, power lines, etc) which is expensive. Infill uses existing infrastructure, thus reduicing the overall construction costs substantially. Sadly, lots of folks are opposed to increased density and have the ear of local government.
 

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My first home cost $43,000 in 1980 and I think we put down $1000 on it. (Money that I had from a cashed in insurance policy my grandmother had on me.) Interest rates were at an all time high of about 15-16%. I quitclaimed it to my ex when we divorced and he let it foreclose. My second home was around $80-$90,000 in 1987...and I put about $3,000 down on it...interest rates were around 8% at that time. I had money I had saved in a savings account from grandparents and gifts that I used for that DP.
On the house I am in now, I used money from a great aunt that died so that I was able to put a big chunk down to avoid PMI. I am very fortunate to live in an upscale area of town and got in before the housing prices got out of reach. I could not afford anything in my section right now if I were starting from scratch. I do know that when I bought the first two homes; they were bare bones and we had to "travel" in for work. Nothing was in those areas at that time. We had to "move out" to afford the starter home.
I figure my next home with have green walls and grey floors and many residents up and down the halls!! LOL
Now is the time to buy, if anyone can. Interest rates AND home prices are at an all time low and those two don't usually go hand in hand at the same time.
 

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Is that the price for a brand new home, or average overall? If you can do the work yourself, I think a piece of junk fixer-upper is the way to go.

My parents gifted us $10,000 for the down payment on our house, but that was only 10% down. Of course that was in '97 so we ended up getting a great deal on our little fixer-upper shack on the river.
 

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The price of homes in my area is slowly coming down.

But it had gotten to the point where anything bigger than what we are in now was at least $125K+ more than what our current home is worth. And that was on a city lot. If you wanted any type of land, forgetaboutit!

But again- it really depends on your location. We're close to Toronto- so our prices are higher than say someone an hour south of us, because we are within commuting distance to TO.
 

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Discussion Starter #12
Also, is construction of new "starter" homes a thing of the past. It seems, at least for this area anyway, that all the new homes built are at least 2000 sq feet, many times bigger, unless it is a condo or townhouse. Plus, they seemed not to be bare bones so to speak, but granite countertops, fancy appliances, etc. Maybe this is what drove the prices up. (All this pre-bust.)
 

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Around here anyway, it's worth looking into buying a piece of property and getting a pre-fab house. It can be delivered and put together, pretty much, in a couple of days.
 

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Oh I agree, not always. I just think it's worth checking into.

We were hoping *someday* to put a logger on our property. It's not pre-fab, but it's a build-it-yourself kit which includes everything to complete your house (or not, if you don't need certain things). The one we looked at is delivered complete for $60,000.
That is very economical to me, being that my husband and his friends can do everything themselves.
 

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Housing is very affordable here, but I have seen the trend that a lot of new homes are in the median income range and higher. There is a lot of new construction in affordable ranges (~$125-150k) but it is cheap....vinyl siding, very little brick, popcorn ceilings/textured walls, all carpet and vinyl...etc. These house are still selling like crazy here. They have no resale value, though. For low 200s like our house you get a lot more quality for your buck plus a lasting investment.

We started out in a starter home....Denny bought it with no help from anyone. It appreciated so that we were able to use the money from that house to put down on the new one. I think that's how most people do it around here nowadays.

Here 300k for a condo that isn't on the beach or a river is a crime....most condos are less than $100k and they aren't really that common. Nearly everyone can afford a house here. There are still a couple of decent starter neighborhoods in the low $100s or less if you get a foreclosure/fixer upper.
 

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Oh I agree, not always. I just think it's worth checking into.

We were hoping *someday* to put a logger on our property. It's not pre-fab, but it's a build-it-yourself kit which includes everything to complete your house (or not, if you don't need certain things). The one we looked at is delivered complete for $60,000.
That is very economical to me, being that my husband and his friends can do everything themselves.
That is a really cool idea! Shane would love something like that. We are working on our yard, and this weekend we are borrowing my parent's tractor to do the bulk of it, and he is like a little boy so giddy with excitement! I have to admit, I am kind of excited too...
 

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Cadey, it is a great idea. I just wish we could foresee it in our future right now. We would demo the house we live in now to build in the same spot, and live in a trailer. Like Cam is doing. :)
 

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Yeah! That would be awesome! I think there is something to be said about the pride of ownership when you take part in building your own home too. I see it with my parents and their home, which my dad actually contributed several hundred hours towards building with the construction team.

And think of the possibilities with that thing!

Cadey, it is a great idea. I just wish we could foresee it in our future right now. We would demo the house we live in now to build in the same spot, and live in a trailer. Like Cam is doing. :)
Oops...inserted the quote in the wrong place. Oh well!
 

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My husband and I bought the most house we could afford 14 years ago (I guess you could call it a pre-fab as they made most of it in a factory in 2 weeks, but it took 8 weeks to finish it once it was in place and we had a basement built before it arrived) Since then, while our incomes have gone up at the usual 3% raise most years, that really just barely keeps up with inflation, or even loses - so really, we couldn't afford any more house now than we could them. Of course right now we could probably get more house for the bucks, but last year we wouldn't have been able to buy our own house back. I have no idea how people afford the houses they buy. And while younger people often expect their salaries to go up, they often don't do more than keep up with inflation.
 
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