Why is DCUM SO conservative with housing?

[Anonymous]

Anonymous wrote:It’s not just DCUM, it’s the people in this area! I know people whose HHIs are likely double ours but they live in old, crappy homes. We are very comfortably able to afford our home, and I’m sure they could too! Perhaps they value passing that money on, or putting it into luxury items

It's definitely a DC thing. Same with old furniture and cars. They prefer passing it to children I suppose.

[Anonymous]

We have the tiny crappy place with a great commute and walk score of 93. Instead of upgrading we bought a kick ass waterfront beach house and go there every weekend. Works out really well for us!

[Anonymous]

Anonymous wrote:I just get confused by the pearl clutching at buying a 1m house on 300k income say, while at the same time everyone seems to have 2 to 3M in retirement accounts by 40 on even more modest income. Something doesn't add up. How can it be super scary to buy a 1M house at 3 to 4 times income and also a given we all need to save way more than that for retirement or starve. Honestly asking

I want to enjoy retirement. I don’t want a big overpriced house.

[Anonymous]

Anonymous wrote:I just get confused by the pearl clutching at buying a 1m house on 300k income say, while at the same time everyone seems to have 2 to 3M in retirement accounts by 40 on even more modest income. Something doesn't add up. How can it be super scary to buy a 1M house at 3 to 4 times income and also a given we all need to save way more than that for retirement or starve. Honestly asking

This is an anonymous forum. The responses you read are from different people. Not everyone here has a $300K income and $2-$3M by 40. We have $1M, but DCUM would still consider us poor because our current income is low while one parent SAH.

[Anonymous]

Anonymous wrote:We have the tiny crappy place with a great commute and walk score of 93. Instead of upgrading we bought a kick ass waterfront beach house and go there every weekend. Works out really well for us!

Same, but you do you, OP!

[Anonymous]

Did anyone click on the link?

I'm surprised that no one has commented on the graph that shows that the current Home Price to Median Household Income Ratio is almost at the same exact level as we were at the peak of the housing bubble back in 2005.

Kinda makes this entire thread lathered in irony.

[Anonymous]

We certainly could have afforded more but we found a great family neighborhood and our kids could walk across a park to a very good school.

[Anonymous]

I don’t like the consumerism of wealthy neighbors. We live in a suburb of now $900-$1M homes that were $600-700k when we bought (on a $350k income.) Some of our neighbors are great, but many are just Mr. and Mrs. Conspicuous Consumption and I hate the message it sends to my kids and the way it makes others feel like they need to keep up.

If that is the way these people act, I cannot imagine trading up to an even more expensive neighborhood and the neighbors I would have there. Sometimes we even joke about moving to a less expensive neighborhood for more down to earth neighbors, but moving is a pain and we like our lot.

[Anonymous]

Anonymous wrote:I don’t like the consumerism of wealthy neighbors. We live in a suburb of now $900-$1M homes that were $600-700k when we bought (on a $350k income.) Some of our neighbors are great, but many are just Mr. and Mrs. Conspicuous Consumption and I hate the message it sends to my kids and the way it makes others feel like they need to keep up.

If that is the way these people act, I cannot imagine trading up to an even more expensive neighborhood and the neighbors I would have there. Sometimes we even joke about moving to a less expensive neighborhood for more down to earth neighbors, but moving is a pain and we like our lot.

This. We used to live in a similar neighborhood and moved for this exact reason. It’s so much better over here. Yes moving is a pain but we are playing the long game - focusing on where and how we want to raise our kids. I am so glad we decided to do it.

[Anonymous]

It also depends on a person's age and whether they have a safety net or not.

[Anonymous]

Anonymous wrote:Did anyone click on the link?

I'm surprised that no one has commented on the graph that shows that the current Home Price to Median Household Income Ratio is almost at the same exact level as we were at the peak of the housing bubble back in 2005.

Kinda makes this entire thread lathered in irony.

OP here. Do you think the DC real estate market is going to crash and stay down for an extended period of time?

I actually do happen to think that some economic pain is in our future as a country. But the housing market is not anything like 2005, when people were buying two, three or four houses for speculation and with no ability to pay the adjustable rate mortgages when rates increased. In particular, the DC area is likely to always have plenty of well-paying jobs to support a healthy housing market. More likely than a sustained crash is just that prices stay high (with some ups and downs of course) and more people get priced out of the market as inequality increases.

It’s always better to buy low of course. But if I were just starting out, I would feel much more comfortable putting a big down payment on a nice house than I would putting money in the stock market right now.

[Anonymous]

I have to day I don't want a big house because then either I have to clean it or pay someone to clean it. When I was a kid I always thought the fancy room no one was allowed to go into was silly and I'm not paying extra for that.

[Anonymous]

Anonymous wrote:Sometimes I just think the people in the house and car threads are the same people with different priorities. Like, I only bought a house for 2x HHI but I spent like 50% HHI on cars every 3-4 years. The difference is that I don't tell anyone in either of those threads what they SHOULD be doing. If you want to go 4x income on house, do it. If you want to drive a mcdonald's happymeal box to work, do it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It’s not just DCUM, it’s the people in this area! I know people whose HHIs are likely double ours but they live in old, crappy homes. We are very comfortably able to afford our home, and I’m sure they could too! Perhaps they value passing that money on, or putting it into luxury items

We fall in this category. We plan to retire early so it’s well worth it to us to live in an older, smaller home. I know you disagree right now, but talk to me again when you’re 52 and still looking at another decade plus of working. We’ll be retired and comfortable by then.

You will not be. Retiring at 52 is simply not doable unless you have the health care solved. Also where you are building equity in your small house, I am building equity in my large house.

Waited into 40s to buy, we’re never made over $200k, and yet we do in fact have health care solved (via the exchange) for early retirement. If you keep your income low enough, it’s even subsidized.

Enjoy your work years!

[Anonymous]

Anonymous wrote:I don’t like the consumerism of wealthy neighbors. We live in a suburb of now $900-$1M homes that were $600-700k when we bought (on a $350k income.) Some of our neighbors are great, but many are just Mr. and Mrs. Conspicuous Consumption and I hate the message it sends to my kids and the way it makes others feel like they need to keep up.

If that is the way these people act, I cannot imagine trading up to an even more expensive neighborhood and the neighbors I would have there. Sometimes we even joke about moving to a less expensive neighborhood for more down to earth neighbors, but moving is a pain and we like our lot.

They are not spending their money at you, they are just spending their money, YOU chose to be bothered by it, as I doubt your neighbors GAF what you think about they spend their money and likely DGAF about you spend yours.