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Re: Mortgage Rates

By: Decomposed in 6TH POPE | Recommend this post (0)
Fri, 16 Sep 22 8:03 PM | 28 view(s)
Boardmark this board | 6th Edition Pope Board 		Msg. 35606 of 60008
(This msg. is a reply to 35594 by ribit)
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ribit:

Re: “but my house payment in 1970 was $211.00 per mo including taxes and insurance. Dunno how I managed to pay it.”In 1970, my parents rented a 4 bedroom house in CA for $150/mo... or $1,800 annually. The landlord lived next door and liked us, so he offered to sell it to us for $19,000. (We didn't take him up on it and, in fact, had a falling out with him 3 years later.) But the annual rent at the time was 9.47% of the home's value.

Today, Zillow says that 60-year-old house is worth $432,900. If it rented for 9.47% of the home's price, the tenants would have to pay $40,996 annually, or $3,416 monthly.

The house won't rent for anything near that amount. Zillow estimates $2,285/mo. And what that means is that home prices these days are too high or rent prices are too low. Or both. Most likely, it's both. I'd expect rent prices to make a huge move upward. That, in turn, means a huge move upward in the homeless - both folks on the street and adult children moving back in with Mom & Dad. It's a great future that lies just ahead.







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The above is a reply to the following message:
Re: Mortgage Rates
By: ribit in 6TH POPE
Fri, 16 Sep 22 3:52 PM 		Msg. 35594 of 60008

...I don't remember the interest rate, but my house payment in 1970 was $211.00 per mo including taxes and insurance. Dunno how I managed to pay it.

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