Something to think about

[CM1995]

A quick internet search says the average monthly mortgage payment payment in Canada is $1800 to $2200 a month. I'm sure there are some that are a lot more.

But why are they increasing an average of $1300 a month in 5 years after origination other than the majority of mortgages in Canada being 5/1 ARMs? Are there not fixed rate mortgages in Canada?

 

[DMiller]

My brother that left CA sold their house that had a Fifty year mortgage, never intended to be paid just folded to next buyer and use whatever value increase as profit against that loan. Bought and paid for a home in CO with proceeds off CA house, doubled size and in last four years doubled in value as more CA evacuees arrive in CO.

 

[mekanik]

Fixed rate is the most common mortgage, 20 to 30 year term mortgages are common here but they have to be renewed at the going interest rate every few years, usually 1 to 5 years. The longer the renewal term the higher the interest rate.

 

[DMiller]

We built when PSF price was under $160, loan for construct was a balloon, converted to a 4% fixed as came to completion. Current loans here are just at 7%. Know of two families in half of our home size paying double what our payments run. I pay extra on the loan and owe less now than when we bought the place in 2010, will get to point will pay it off in less than four years.

 

[92U 3406]

A quick internet search says the average monthly mortgage payment payment in Canada is $1800 to $2200 a month. I'm sure there are some that are a lot more.

That's crazy. That's about 40% of the average monthly gross income in this country.

 

[DMiller]

Payments here for newer loans is equivalent to 50/55% net incomes for many.

Will note, nearly ALL of the current mortgagees are one bad economic day from default.

 

[crane operator]

Fixed rate is the most common mortgage, 20 to 30 year term mortgages are common here but they have to be renewed at the going interest rate every few years, usually 1 to 5 years. The longer the renewal term the higher the interest rate.

If it renews every 1-5 years, at current interest rates, we wouldn’t call that a fixed rate here in the states, it would be a long term adjustable.

If I have a fixed rate loan in the states for 20 years, the interest rate stays the same for the full 20 years of the loan, regardless of what prime rate is.

That’s why cm1995 is saying it’s hard to get longer term owners to move up or down. If I bought a house 8 years ago with a 30 year fixed. That home has likely doubled in value, but the interest rate is still locked for the next 20 years at half of the current interest rates.

So if I want a better home than my current home, I’m faced with this- my house was 175,000 15 years ago, today market value is probably 300,000. But if I sell it to lock in my gains, I’ve got to buy a 450,000 home, to have a nicer home, and borrow 200,000 at a higher interest rate to do it. It would double my monthly payments.

My kids are almost all out of the house, so if I wanted to sell this house, and buy a smaller home, the smaller home is priced more than I gave for mine 15 years ago, so there’s not a huge reason to downsize, my current home is cheaper than anything remotely comparable on the market.


So I ain’t moving.

 

[92U 3406]

The banks here give us some pretty good options for paying down a mortgage though. You can increase your payment a bit and the extra goes straight to the principal. Some will let you drop a lump sum amount against the principal every year penalty free (there is a maximum amount you can put down). When you renew the mortgage at the end of your term you can actually opt to pay it off early without penalty or make a lump sum payment without a limit.

 

[CM1995]

Lumber is back down to $344 per thousand from its high of $1600 in 2021 and $1400 in 2022. Lumber prices and lack of vital items like windows and appliances have pushed our build back.

I actually expect lumber prices to go down slightly further due to the current interest rate hike.

 

[DMiller]

Agreed as to expense. The ONLY way I can walk from this place and buy or build another is if I can recover enough to PAY completely that next buy. In the current market most likely cannot.

We make a Principal ONLY addition to our payments here, actually drops payments off The BACK of the note as interest incurred drops off. On our thirty we will IF ONLY pay as have been will pay off the note in 22, I add more educes it further still where once achieve a level low enough will just drop the end cash against that note and most likely Not have 15 or 16 in the note.

Our local lumber providers still estimate Cost PSF is around $200-210 dependent of owner Sweat equity or actual build labor. Concrete is currently a bad value, due to demand and limited supply, cost per yard delivered is $145/yd Weekday unless ANY wait time, is a added figure, also add a Fuel Surcharge. Saturday, is $185/yd

 

[CM1995]

One can buy a nice new home in a subdivision with resort style community pool and club house for $200-220 PSF. Now these are on a slab 15' away from the next house though.

 

[92U 3406]

One can buy a nice new home in a subdivision with resort style community pool and club house for $200-220 PSF. Now these are on a slab 15' away from the next house though.

I rented a house in a neighbourhood like that for a while. 8 feet between houses and a backyard wide enough to park 2 pickups. Glad to be away from that. Not really a fan of the 600 sq ft footprint houses that they have to have 3 levels just to squeeze in 3 bedrooms.

 

[CM1995]

I rented a house in a neighbourhood like that for a while. 8 feet between houses and a backyard wide enough to park 2 pickups. Glad to be away from that. Not really a fan of the 600 sq ft footprint houses that they have to have 3 levels just to squeeze in 3 bedrooms.

These are 2500-3000 SF on 2 levels but same thing. Most of the masters on the main level with 3 bedrooms up. 2 car garage that only 2 Mini Coopers fit in or could turn around in the driveway.

 

[DMiller]

Been down to visit JY where most homes are slab cookie cutter. Nice for what they cost but far too close in for me. Lived OK in the early 80s, has really changed since those days, seems everything is disposable now, roads, houses, subdivisions. I enjoy walking out of my shop, peeing where I please, not seeing anyone close enough to be modest.

 

[Coaldust]

Despite the higher interest rates, we are still seeing single family homes gain 4-8% annually, in the Valley. I haven’t paid much attention to Anchorage prices, but I guess to say prices are holding steady and perhaps slightly dropping for certain price points. Rental vacancies are certainly rising as people leave Ancorage. The ASD is closing schools, which enforces the theory people are leaving.

In the Matsu, home building is going strong. It’s a mixture of buyers leaving Anchorage, people upgrading, out-of-staters building second homes, retirees building.

 

[Truck Shop]

Hamster cages with a community cesspool to cool off in. Building 200 hamster cages on the edge
of town-garbage track houses. The business around here is building storage units, lots of those
under construction. A place for people to store the crap they don't need and couldn't afford and
pay even more to store it.

 

[DMiller]

Was thru Boone County last week, Columbia MO area, tract housing starts are astonishing and asking MONSTROUS pricing. 1200sf almost two car garage(If have two Smart Cars) all on a 100x80 lot $265,000, have to be insane to walk into that with open arms. Builder wanting to do similar in St Charles County has run into locals road blocks not wanting what will buy those anywhere close.

Here in the little town of Hermann city fathers are whining cannot get New Residents for the Schools and support system companies, then openly allow EVERY B&B permit app to be approved. Have already crossed the point of no return as to unfilled bedrooms in town even during major winery events. Town may implode and we are considering selling while can IF can, to not be here when occurs.

 

[92U 3406]

Was thru Boone County last week, Columbia MO area, tract housing starts are astonishing and asking MONSTROUS pricing. 1200sf almost two car garage(If have two Smart Cars) all on a 100x80 lot $265,000, have to be insane to walk into that with open arms. Builder wanting to do similar in St Charles County has run into locals road blocks not wanting what will buy those anywhere close.

Here in the little town of Hermann city fathers are whining cannot get New Residents for the Schools and support system companies, then openly allow EVERY B&B permit app to be approved. Have already crossed the point of no return as to unfilled bedrooms in town even during major winery events. Town may implode and we are considering selling while can IF can, to not be here when occurs.

My old landlord sold the place I was renting when my lease was up. It sold for more than that with a lot less house and no garage.

 

[DMiller]

Mind you these were all Slab on Grade.

 

[crane operator]

One of my son's friends (early 20's - young wife and a kid) just dropped a downpayment on a new tract house and I think he said its in the 230's, and probably 1,300-1,500 square ft.