Americans locked into lower mortgage rates have been increasingly unwilling to sell their homes.

[Anonymous]

Anonymous wrote:

Anonymous wrote:We're in this camp. I feel like we're doing well financially. There's always someone richer, but overall are very fortunate.

We make ~$400K salary w/ upside to ~$600K+ in a good year, have a $1.6mm investment portfolio/$0.4mm home equity, paid for cars, 35 yrs old. We have a small, old ~$1.3mm house and a $4.4K / month payment (for which we paid $1mm and refi'd into <3% rate). If we want something nicer in same hood, let's say a $2.2mm house and took every single dime of accessible investments ($1mm) and every single dime of post transaction cost home equity ($0.4mm) and bought that for $2.2mm house w/ a $1.4mm down payment, then our payment would go from $4.4K PITI to $8.2K PITI. With childcare and our otherwise lavish lifestyle and desire to save $$$, simply would not work, notwithstanding the giant loss in diversification and liquidity and the comfort that comes with having an investment portfolio that pays for the mortgage.

So when I look at these $2mm homes flying off shelves, I can only conclude that people are wealthier than us (which in our little bubble is probably true in select cases) or simply have a higher willingness to concentrate in home equity.

I hear you all playing the world's smallest violin for me, but it is difficult for me to comprehend home pricing with where rates are.

Wow, all those numbers look eerily close that I had to double check my spouse didn’t post this.

Family money? I’m a bit older with higher income and don’t have anywhere near your stock portfolio.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I'm never moving out of my starter house at a 2.2% mortgage. We just get used to making do with less space.

+1 I also have a 2.2% mortgage. We bought 18 years ago, and our mortgage is $1200/mo. We've raised two kids in our small 1100 sq ft home, and it will be the perfect size for us as empty nesters. I expect my kids to move out in the next few years, and our mortgage is almost paid off. We are in DC and have a decent-sized yard. I'll never sell.

You need a bigger home in retirement. My neighbor has a 7,000 sf house and Xmas, Easter, etc often 6-8 cars in driveway and 20-25 people staying over as they host holidays.

Then you got engagement parties, weddings, watching grandkids, pet sitting.

I have a 7 bedroom house. It is crowded sometimes. One kid brought friends home from college, other doing sleep over with friends, third one in her room me and wife home and pets.

When I was young we had a 1,300 sf house with three little kids. I had that till oldest 18. Now I need way bigger.

Don’t you watch hallmark? Grandparents always have the large homes and kids come home for holidays with grandkids

Why would you need a bigger house. I don't want a bigger one as I don't want to clean it. I have no interest in hosting tons of people. My grandkids will always be welcome and they can have their parents old bedroom. We live just fine in 1000 square feet. House is paid off and its freeing not having a mortgage.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

How does that make sense?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

How does that make sense?

It makes sense because you are not actually obligated to own a house. You are not obligated to live forever in a certain area. If you are deeply unhappy with your home but cannot afford anything better in your area, don’t resign yourself to keeping it forever just because you like your GD mortgage rate!

You can always move! Or rent! Or both!!

Or just stay and be miserable, if that’s what floats your boat.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

How does that make sense?

It makes sense because you are not actually obligated to own a house. You are not obligated to live forever in a certain area. If you are deeply unhappy with your home but cannot afford anything better in your area, don’t resign yourself to keeping it forever just because you like your GD mortgage rate!

You can always move! Or rent! Or both!!

Or just stay and be miserable, if that’s what floats your boat.

You’re paying a big premium for the flexibility of renting.

And, you’re still paying the high cost of financing. Just not directly.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

How does that make sense?

It makes sense because you are not actually obligated to own a house. You are not obligated to live forever in a certain area. If you are deeply unhappy with your home but cannot afford anything better in your area, don’t resign yourself to keeping it forever just because you like your GD mortgage rate!

You can always move! Or rent! Or both!!

Or just stay and be miserable, if that’s what floats your boat.

You’re paying a big premium for the flexibility of renting.

And, you’re still paying the high cost of financing. Just not directly.

Most people who buy end up moving anyway, getting killed on transaction fees and not making enough on appreciation to make up for it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I'm never moving out of my starter house at a 2.2% mortgage. We just get used to making do with less space.

Yep, you are trapped there.

PP here - it's all a question of mindset. Trapped? Or very fortunate to be homeowners?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We're in this camp. I feel like we're doing well financially. There's always someone richer, but overall are very fortunate.

We make ~$400K salary w/ upside to ~$600K+ in a good year, have a $1.6mm investment portfolio/$0.4mm home equity, paid for cars, 35 yrs old. We have a small, old ~$1.3mm house and a $4.4K / month payment (for which we paid $1mm and refi'd into <3% rate). If we want something nicer in same hood, let's say a $2.2mm house and took every single dime of accessible investments ($1mm) and every single dime of post transaction cost home equity ($0.4mm) and bought that for $2.2mm house w/ a $1.4mm down payment, then our payment would go from $4.4K PITI to $8.2K PITI. With childcare and our otherwise lavish lifestyle and desire to save $$$, simply would not work, notwithstanding the giant loss in diversification and liquidity and the comfort that comes with having an investment portfolio that pays for the mortgage.

So when I look at these $2mm homes flying off shelves, I can only conclude that people are wealthier than us (which in our little bubble is probably true in select cases) or simply have a higher willingness to concentrate in home equity.

I hear you all playing the world's smallest violin for me, but it is difficult for me to comprehend home pricing with where rates are.

Wow, all those numbers look eerily close that I had to double check my spouse didn’t post this.

Family money? I’m a bit older with higher income and don’t have anywhere near your stock portfolio.

I just realized we are older too so not exactly the same. Parents paid for college that helped, but all 4 years was less than $20k.

[Anonymous]

Is mortgage portability not a common thing? My mortgage is, per the T&Cs, portable to another property. Is this not common or is it just incredibly complicated to get lender approval?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:We're in this camp. I feel like we're doing well financially. There's always someone richer, but overall are very fortunate.

We make ~$400K salary w/ upside to ~$600K+ in a good year, have a $1.6mm investment portfolio/$0.4mm home equity, paid for cars, 35 yrs old. We have a small, old ~$1.3mm house and a $4.4K / month payment (for which we paid $1mm and refi'd into <3% rate). If we want something nicer in same hood, let's say a $2.2mm house and took every single dime of accessible investments ($1mm) and every single dime of post transaction cost home equity ($0.4mm) and bought that for $2.2mm house w/ a $1.4mm down payment, then our payment would go from $4.4K PITI to $8.2K PITI. With childcare and our otherwise lavish lifestyle and desire to save $$$, simply would not work, notwithstanding the giant loss in diversification and liquidity and the comfort that comes with having an investment portfolio that pays for the mortgage.

So when I look at these $2mm homes flying off shelves, I can only conclude that people are wealthier than us (which in our little bubble is probably true in select cases) or simply have a higher willingness to concentrate in home equity.

I hear you all playing the world's smallest violin for me, but it is difficult for me to comprehend home pricing with where rates are.

Wow, all those numbers look eerily close that I had to double check my spouse didn’t post this.

Family money? I’m a bit older with higher income and don’t have anywhere near your stock portfolio.

I just realized we are older too so not exactly the same. Parents paid for college that helped, but all 4 years was less than $20k.

Same. Not yet 40, so I'm worried I have a spending problem! We got a late start because of grad school, I guess.

[Anonymous]

Anonymous wrote:Is mortgage portability not a common thing? My mortgage is, per the T&Cs, portable to another property. Is this not common or is it just incredibly complicated to get lender approval?

Who is your lender? Is this a VA loan,

No, vast majority of mortgages are not portable.

[Anonymous]

Anonymous wrote:Is mortgage portability not a common thing? My mortgage is, per the T&Cs, portable to another property. Is this not common or is it just incredibly complicated to get lender approval?

Portability is extremely rare. I have a mortgage that is transferrable (to the future buyer of the house) and my realtor said even that is rare.

[Anonymous]

Anonymous wrote:Anything less than 5% at this point is worth more than gold

#noduh

DH says we are staying out until/if we retire and downsize dramatically.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I don’t understand the mindset of living in a house you don’t want anymore just because you got a good deal on it. Eventually housing prices will have to come down because as has been pointed out here, higher interest rates puts many houses out of reach for a lot of potential homebuyers. And of course renting is still an option.

Really? We can’t afford anything better. What’s so hard to understand? And honestly my parents became house poor when they upgraded to a bigger house, so that experience has stayed with me somewhat.

Well we moved out of the area and rent something we like now 🤷🏻‍♀️. You always have options.

How does that make sense?

It makes sense because you are not actually obligated to own a house. You are not obligated to live forever in a certain area. If you are deeply unhappy with your home but cannot afford anything better in your area, don’t resign yourself to keeping it forever just because you like your GD mortgage rate!

You can always move! Or rent! Or both!!

Or just stay and be miserable, if that’s what floats your boat.

You’re paying a big premium for the flexibility of renting.

And, you’re still paying the high cost of financing. Just not directly.

Most people who buy end up moving anyway, getting killed on transaction fees and not making enough on appreciation to make up for it.

+1. Making your current house work better for your family often makes more sense.