pccb123 t1_j9fudjz wrote
Reply to comment by Chippopotanuse in As of Aug 2022, the median millennial household income was $106,661. People making at or close to the median household income that are buying houses in MA, where are you able to buy? by BoOo0oo0o
All very true, however, it looks like this post is specific to millennials so, retirees and teachers with 20 years of experience arent really relevant (although getting close).
x 10 for your point on family wealth. Lately, I feel like that is almost always the missing piece to my "how are people affording this?" confusion
UltravioletClearance t1_j9fwewt wrote
Putting down a huge down payment (like close to 50 percent) is the only way buying a $600k+ home on $110k household income makes any mathematical sense. A lot of people who do this tap into family weath or an inheritance for the down payment.
pccb123 t1_j9fwm9h wrote
Absolutely.
occasionally_ganache t1_j9fxm8i wrote
Not quite, even with 10-20% down if you’re willing to have roommates then it works out strongly in your favor versus continuing to rent.
Ready-Interview-9809 t1_j9gi79v wrote
Whatever percentage you need to avoid PMI is gonna make the difference. Look it up.
rakdoc t1_j9guwku wrote
I pay 66/ month for PMI. it’s boring if you have heat great and solid income. it’s 1/50 of my mortgage
WinsingtonIII t1_j9hftbv wrote
PMI is not nearly as big of a deal as people make it out to be. Mine is like $70 per month, I pay more for my cable/internet bill. That's hardly a big deal when you consider what your mortgage will be in most parts of MA anyways.
I don't think there are many situations in a high housing cost state like MA where someone could otherwise afford the mortgage on a house but can't because of the PMI amount.
Ready-Interview-9809 t1_j9hjaoi wrote
I was replying to the “10-20% down” comment. Noting that if someone had the option to put 10-20% down, whatever percentage to avoid PMI would save ( for you $70x12=$840/yr ) and be the better option.
WinsingtonIII t1_j9hpvle wrote
Sure, that said I do think in such a crazy housing market you have to consider the opportunity cost of delaying your home purchase to save up the necessary down payment to hit 20%. But yes, if you can already afford 20% then there's no reason not to just put down the 20%.
We bought three years ago and put down around 10%. If we had waited to save up for 20%, we'd still be saving and wouldn't be able to buy yet. Meanwhile, the value of our house has increased by $100,000 in that same timeframe and the interest rates have skyrocketed. We simply wouldn't be able to buy this house today, whereas we could three years ago.
Paying $840 per year for ~6 years to be locked into a sub 3% interest rate mortgage on a house that cost $100,000 less than it would today is absolutely worth it. The difference in list price and interest rates if we bought today would easily exceed the $70 per month we are paying in PMI.
Ready-Interview-9809 t1_j9hr4m7 wrote
Totally
occasionally_ganache t1_j9gjrev wrote
20% is the amount to avoid pmi, I know because I literally pay pmi
Cupcake-Mountain t1_j9iyd0s wrote
There are loans where you only need 3% to avoid pmi. I know because I only put down 3% and don’t have pmi.
Chippopotanuse t1_j9fxem8 wrote
Millennials are 27-42.
Every teacher I know started around 22. But I mostly know teachers who went to BC and local schools and am not as familiar with folks who transitioned into teaching at age 40.
So yes - there are a whole shit ton of 15-20 year teachers in the millennial age range. I wasn’t referring to 65 year olds but I can see how you might read it that way.
And maybe you missed the “early” in the retiree part.
Boston has a stunning amount of folks who made a lot of money in tech and finance (or who have family wealth) and who leave full-time work in their 30’s / 40’s. Especially to have kids. I saw it all the time back when I did big law. (I left full time employment at age 37).
The millennials right in the middle of this median - the ones who actually do make around $105k as a household and who are between age 27 and 42 - are a very diverse and weird mix of folks with all sorts of different economic and family circumstances in my experience. It’s really hard to lump them into one bucket and generalize.
(Two line cooks who are 40 and who make $50k each are very different than a single 27-year old renter who makes $105k at State Street. Etc…)
pccb123 t1_j9g37o1 wrote
Im a millennial. I agree with you. I was just noting that salaries of teachers with 20 years experience and (early) retirees wouldnt really skew that median too much since there arent that many millennials in either group quite yet. Even the oldest millennial who started right out of college att 22 would just hitting 20 years now. Although I definitely wasnt thinking early retiree meant 30s/40s, and Im sure youre right that there are way more tech/finance people who leave full time work than I considered. Now I'm curious the % of people in their 30s/40s who were able to do so.
Either way, I agree that its hard to lump everyone in/generalize, particularly when it comes to familial wealth, etc.
Electrical_Media_367 t1_j9icuar wrote
I'm a millennial and I graduated college 20 years ago. We're in our 40's now.
pccb123 t1_j9jkzq6 wrote
I know that millennials are in their 30s-40s. I am one. I wasnt suggesting otherwise.
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