Quote:
Originally Posted by joey2665
These people you are soaking about would not be purchasing a median priced home of 400k. There are more affordable homes for them under the median at a 200-250k price off the lake with very low property tax. As stated above a mortgage company will not approve a mortgage at 50% ratio. Also missing the extremely favorable rates and down payments for first time homebuyers. Additionally as mentioned in many other places the younger generation is more in favor of renting to have more disposable income.
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That's true, however have you seen what you can buy for that price? A place that is a wreck and needs lots of work so while your income may not be consumed with a house payment the repairs will. Even stuff in the 300-400K range often times need work too!
Floating more debt with a minimal or no down payment leaves no room for error if the market fluctuates south which it does do. If the rates increase that'll erode home values too. Many first time home owners don't sufficiently account for this.
Renting is always an option but often times renting is equally as expensive as buying. The only benefit is not having to worry about the cost of repairs.
I still emphasize that none of these options offer any room for savings and building a long term nest egg or even emergency fund.