Bought my first home right at the end of low interest rates. I wasn’t planning on staying but I can’t afford to move now.
Yeah just to refinance my current mortgage with the current interest rates would raise my monthly expenses the cost of renting an apartment.
Any reason why you can't rent out your current home and rent something else where you want to move to?
That way you could keep building equity with your low interest rates and sell when it makes more sense.
I know that requires being a landlord, but the current market also seems to require some creativity.
Sold high, bought low. New house went up 150k in 10 months. Refinanced at 2.7 and locked it in. It’s our forever home so I’m feeling pretty good about it. We took the profit from the last house and paid off all our debt and invested the rest into the new place.
This is to the letter what we did! Congratulations!
Bought in Dec of 2020. I guess we’re never moving…
Bought in May 2020. Same boat bud.
I know quite a few people in the same boat as you who have rented out their home with a low-interest mortgage and rent something else where they needed to go until it makes more sense to jump back in the market.
I think this a dilemma many, if not most, homeowners will face down the road. What to do with that mortgage from 2020-21.
Great rate. Glad I bought when I did.
We bought at what I thought was the peak, was sure we were overpaying, and mortgage as high as we can manage when tax & insurance figured in.
Since then, prices in the neighborhood have doubled, and houses are being torn down and replaced with two homes on the same lot, enormous houses small yards. Always crazy expensive ones.
I don't like any of this. Don't think it makes sense. The utility of a house can't be more than the prevailing wage in an area can pay, so we'd all be better off with lower housing prices. Sure, our house is valued at 2x what we initially paid (we have since made improvements so maybe even more) but it does nothing for us. Same house. They are way over valued here.
I think I closed in December 2019
My house is literally one of a kind. On the national historic registry and also recognized by the city. Two cute bronze plaques attached to the front near the door. It's a Tutor Revival that has been kept in its original state almost religiously.
It's my favorite house I have ever seen so I'm lucky. Looking at it is just awe inspiring.... It's actually awesome
It sounds awesome but I would personally hate living in a home like that as you're not allowed to do anything to it and any repairs have to be done in a specific (and more expensive) way. It's like living in an HOA on steroids.
That's not really the case. The street view is what is supposed to stay the same. But it isn't really anything binding.
Bought in 2020 and locked in 2.65%. It's a bit of a fixer upper due to the previous home owners' neglect. About $60k in repairs and improvements so far has it feeling more and more like a home. The house value has risen more than I put into it.
My wife and I say almost weekly how bad we feel for others and how lucky we were. The timing was impeccable. Cashed out our 401k, used covid relief checks, and went from a 600sq ft cabin on family property to a 2k+ sq home we owned.
Super, super lucky.
You were extremely lucky with that interest. Congrats! What are you both planning/doing for retirement now? Are you going to try to max your contributions to make up for cashing out?
Absolutely lucky. Thanks!
We increased our contributions to what we can afford and went from $0 in 2020 to $52k now. Just keeping on keeping on.
Trying to pay down all other outstanding debt (car, solar loan) higher than what we can make back through other investments. My wife has a job that will match 7% after a vesting period, so we're waiting for that nice bump to really figure things out from there.
Stole the place.
Wife and I bought Nov 2021. Locked in at 3.25%. Bought a good house in a decent neighborhood. Feel great about it.
I bought in Feb 2022 and holy shit did I sneak in at the end.
Bought mine in March of 2020. Equity on my house is now like $150k and my interest is 3%. Dont want to move but need a bigger house now.
Relieved, honestly. I feel terrible for my friends that are still in the hunt
Pretty darn good. 2% interest rate locked in for 20 years. Sure we overpaid market value and the house lost a little value this year but we are ahead in our mortgage and we are fine with how much we paid for it.
Even if you paid too much, it's still going to appreciate further. Just a slightly longer wait, maybe. And property is supposed to be a long game.
Bought in 2017 but refinanced in 2021 or early 2022 down to low 2%. Basically extended the mortgage by 4 years but God damn an i glad I did that.
Bought in 2019 at 3.75, refinanced to 2.5 in... 2020 or 2021.
It was supposed to be a 3 or 5 year home. Now, we can't afford to sell it. It's small, which was great at the time, but we need more space now. But there's no room on the lot to add on.
The current plan is to build a shed and move my office into it if we need that room for anything.
Can you rent out your current home and rent something more suitable for yourself until it makes sense to jump back in the market?
Many homeowners are becoming "accidental landlords" these days because of this peculiar situation.
Can you rent out your current home and rent something more suitable for yourself until it makes sense to jump back in the market?
We bought in August of 2020 and paid a little less than the previous homeowner paid in 2013. Locked in at 2.75% interest on the mortgage and pay today about $500 more than we did for our apartment rent right before we bought.
The house we bought has two stories but would allow for single floor living as we age. We might move to something smaller when that time comes though.
All in all we feel pretty great and absolutely love our house! It’s on a bluff overlooking the Mississippi River and we call it our treehouse.
It's technically our second place and it's bigger, newer, but needs a bit of updating.
It's not everything we wanted and between closing costs, moving costs, the exhaustion of moving and adjusting to the move I don't think we're going to do it again before we're priced out of the thing we want.
We were hedging against either a bigger market correction or a bigger price explosion. Instead we just got weird global stress and fatigue.
I live in an apartment of broken dreams
Sold our first starter house to fund our dream home that fits us all at a low fixed 30-year rate. Pretty darn fantastic.
Pretty great. Had a small (1050 sq/ft) house built in a semi-rural area and live comfortably. Two bedrooms, two bathrooms, was only ~$210k. Bought about $6k in points to get the interest rate at 2.25%. My mortgage is less than I was paying in rent for a ratty old single bed/bath 640 sq/ft townhome.
Plus I got out of the city. It's quiet. Night sky is beautiful out here. Just stars as far as the eye can see. I got mountain views, deer chilling outside my house. I've got one neighbor across the street and my next closest neighbor is like a quarter mile up the road. It's lovely.
Also, I don't plan on selling, but apparently the place is already worth something like 30% more than the purchase price.
We built in 2018, and refinanced twice in twelve months over the course of the pandemic. We're on a 15-year now with payments only slightly higher than our original 30-yr payments were, which makes me feel like everything is completely arbitrary.
But in any case, I'm glad we like the house. There's no way we could ever move, in this economy.
Great I guess. No mortgage involved, so I’m thrilled that I found my happy place.
We sold our rural starter home in Dec 2020 and made a decent profit, which we used to move back to the city in June 2021. We definitely overpaid on the purchase price (not a lot of choices in our housing market), but our rate is good and the payment is doable, so I think it was a good decision.
I sold my house in a rural area at the end of 2019 and then signed a contract to buy my condo in the middle of a big city right before the covid quarantine started. I think I would have been significantly better off if I had waited six months to do both those things, but such is life. At least I have my low interest rate...
Well, rate is good and though I felt we paid a high price at the time, we’ve actually built a lot of equity in a short time. In hindsight the price was low.
That said, inventory was really limited in 2020, so we had to compromise on location a bit.
I’d like to move to a different neighborhood, but now prices and interest rates are higher. To trade up, I’d be paying 2-3x what my current mortgage payment is.
Offer accepted on a listed c16 farmhouse in q4 2021, after thinking about the original 3y fix mortgage we lined up, I convinced the wife to put up all the profit from the last house, the entire renovation budget (as well as a bunch of profit from a potentially foolish foray into $GME) to get to 75% LTV and a 10y fix on just over £500k @ 1.7%
It took until July 2022 to complete, managed a big discount on offer price due to some confusing wording on the estate agents listing (and the vendors being a bit silly and telling us they needed to sell ASAP cause they were getting a divorce) but managed it before the mortgage offer expired
I'll be almost 40 by the time i need to worry about payments going up, and we'll have way more equity by then - safe to say I'm pretty chuffed
Bought right around early 2021. Got a fixed rate, had a whole bunch of bonuses (first time home buyers, construction bonus, etc.) and got a really damn good deal.
Fixed rate has ended and I’m only going to be able to keep making the new minimum payment if a fucking miracle happens.
Fixed rate has ended
After only two years? Doesn't sound very "fixed" to me.
Where I am there are no fixed-for-the-life-of-the-loan mortgages, so I will have to remortgage at a higher rate in 2025. I expect by then things will have calmed down a little from the worst this year, but will still be significantly more expensive than they are now. However, I will have had five years paying very low interest rates (about 1.6%) and am overpaying. It makes more sense than renting and the place I bought has been a great place to live during the pandemic. I don't know how much the value has increased since I bought it - despite small falls though the wider area has seen average property prices go up about 25% over this time so I'm not in any danger of being stuck unable to move. Even if prices collapsed I would likely be safe from negative equity due to having had a large deposit.
Bank ordered us a stupid high amount to loan. We thought it was stupid high and used just half of it. In do happy er did so.
bought in 2020 .. value of property has increased 50%, land value has doubled - which helps if i need to refinance as the amount owing is less than 80% of the value so i get interest rate discounts. I border a new-ish estate of mcmansions but i have double the block size. If i had some significant cash behind me i'd knockdown, divide the block and build 2 homes. but i dont, but i can dream. i'm happy.. not about interest rates but it's for the future/kids
Bought a fixer upper in June 2020 from a couple way in over their head. Zillow's estimate puts me up 38% from my purchase but with everything Ive added/built/fixed, I think I could double the price if I wanted to sell it- cool house in a now popular neighborhood. Doing well, I guess.
Bought my house in 2019 before the market went crazy and then I refinanced when the interest rates went down to 2.2%. I still can't believe how lucky I got.
Lucky. Still hoping interest rates inflect by 2025.
Why specific bought in '20/'21? Bought the house as single in '00, monthly costs were about 20% less then renting a similar house in worse configtion. The value then in guilders was less then then now in euro. (about 125% rize in value) and I'm paing in morgage about 75% of what I paid when I bought it. (and that will stay the same for another 7y)
It's a good house and way cheaper then letting. I could see ut as investment, but I need a roof to live under. It's a comfortable and very affordable place to live.
Why specific bought in '20/'21?
Because there were a lot of things converging in 2020-21. But thanks for your input as well. Always interesting to hear perspectives.
Yeah, ok, lots of things changed in '20/'21, but housing is a long term investment. Almosta always owning something is cheaper then letting/renting/leasing, as you pay extra to the middleman to take a way some hasstle.
Adding onto what OP said, housing prices have literally more than doubled in the past two years, and interest rates were at record lows during that time, especially in 2020
They doubled before, they'll double again, and crash.
When you sell the house at a huge profit, you'll have to spend all again to buy one back, probably more as you have transfer costs, decorate, move,... Yes, houses have economical value, but for all it's a necessity to be able to live in one.
Bought super cheap in early 2020, refinanced almost immediately to make it even cheaper.
Then I found out I can rent the place out for more than my payment, so o basically couldn’t afford to live there since I get paid to not live there. So I’m renting it out now and it’s free real estate.
Bought another one basically immediately after the first was rented, the bank saw the balance sheet and said another loan is a no-brainer even at a higher rate. Lived in that one for a year, but now I’m renting it out too because again, it’s just better financial sense to do so.
Moved back in with my parents because buying a third house feels risky and I’m tired of moving.
The Mrs and I have agreed we'll never buy and rent out an investment property, even if it makes financial sense.
To fight with other investors over someone else's first home to boulster my own portfolio and then harvest other people's wages because I had a higher initial deposit seems dirty to me.
I refuse to pull the ladder up behind me if and when we can buy our first home.
Wasn’t my idea at first either, but then its hard to say no to free money.
I agree the system is wrong and bad, but we are all living in it. I decided I’m not going to make choices against my own best interest. Hard to compete with people who play by fewer rules than you, so giving myself artificial rules would certainly limit my happiness/wellbeing/etc.
Anyways we all “harvest” money from others in some way or other, either directly or indirectly. Someone working at a restaurant harvests other peoples wages when they want a hamburger. The only way it’s different is that housing is scarce because you can’t build any more in most places where people want to live, but hamburgers are easily obtainable.
Wow. Never heard this variation before.
I know a lot of homeowners with low-interest mortgages from 2020-21 rent out instead of selling if they need to move and rent something else for themselves until it makes sense jump back in the market. But this one was new.
Wow. Never heard this variation before.
I know a lot of homeowners with low-interest mortgages from 2020-21 rent out instead of selling if they need to move and rent something else for themselves until it makes sense jump back in the market.
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Class warfare I what you are describing. Keep drinking that propaganda. A few homes being purchased to be rented by what are basically poor people aren't hurting the housing economy. A low level landlord is no where near the same as a billionaire. Billionaires should learn to reach into wood chippers as a hobby, but my god a landlord is not an automatic enemy of the average person.
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