I recently gave up my 3% mortgage from 2013 in exchange for a 7% mortgage. It hurts, but it was worth it to get out of Florida.
In the end, my housing costs actually didn’t change that much because my home insurance rates were skyrocketing.
but it was worth it to get out of Florida.
You could put almost any horrific thing in front of that phrase and it sound valid.
I had to keep my arm in a tub of fire ants for 5 minutes, but it was worth it to get out of Florida.
I had to cut off several limbs leading to a bad case of sepsis…
I had to sell a few children (not mine) along the way engage in some other morally questionable activities…
I had to sacrifice my first born like Abraham did his Isaac…
…but it was worth it to get out of Florida
It reads like a country song…
🤌
I could not agree more. The flip side is likely true as well…
“I’d rather put my arm in a tub of fire ants for 5 minutes than move to Florida. “
Also home insurance isn’t tax deductible (to my knowledge unless you’re renting the house and then it counts against the income you made renting) but the interest paid is.
That’s a good point, but I’m definitely paying more taxes now than I was before. My new state has income tax and tangible property (vehicle) tax that Florida didn’t have. I looked up tax distribution for my county and the majority goes into education, so I can’t complain too much.
I’m in year 17 of my 5 year starter home. I can’t afford to upgrade now. I’m gonna die in this house.
Hey, don’t be so glum. You could die at work for example.
I work from home lol
Ok yeah you’re gonna die in your home
Nice, you’re both right.
Same story as everyone else. Bought pre-covid, refinanced, now sitting pretty. We desperately want to move, but I would have to make like $50k more a year for the same quality of life.
Rent it out or sell it and move. How is it not a wash for whatever u want to buy?
Because interest rates are way higher now?
Uhh, because of interest rates. The very thing being discussed here.
I don’t know where OP lives or how much their house costs, but a $400,000 home at 3% is around $1,685/month. Same price at 7% is about $2,660/month.
If it were in a more expensive neighborhood, a $1 million dollar home at 3% is about $4,200/month. At 7%, that makes it $6,650/month. Many average houses in California can cost $1.5 million… so needing an extra $50k/year sounds reasonable to be able to move into a similar house.
You have to get a new loan when buying a different house unless you have the money to pay cash. That means you accept the current rate. I wouldn’t want to spend an extra grand or two per month on a similar house.
Kinda strange reading all these comments about how people dislike their house and where they live, but can’t imagine giving up their mortgage rate.
The almighty mortgage handcuffs, the true American dream.
Oh look it’s me. 3.125%
My wife and I LOVE our house and don’t want to leave, but we definitely thought it was going to be a starter home. We straight up could not afford the mortgage payments anywhere else at today’s rates, even in a much smaller house
I couldn’t afford to buy the house I currently live in, today. The “value” of my house almost doubled in value, and interest rates are close to triple what I have now. There is no way my family is going to move out, it’s pretty stupid that an upgrade of a home, in terms of dollar value, would put me somewhere much smaller.
Had 30 yr 3.84%, refinanced in 2021 to 15 yr 1.999%. it’s the cheapest money I’ll ever have.
2.875 here, my monthly payment is $545. I want to move, but it would be financially stupid to do so
Basically, unless the sale gets you enough to buy the next house in cash, it’s a bad idea, lol.
The value of my house has gone up by about 50% so I could definitely put the money forward, but it still would be a questionable decision.
Oh, yeah. This isn’t the house I wanted to die in, but unless we have another near-negative interest rate drop, we’re here for the long term.
“Are you willing to relocate?” has now become a hard “no.”
And people moved away from cities during COVID to decrease their cost of living and get a bigger place while still being able to work from home. They bought with lover interest rates in their mortgage.
Now employers want a return to office. The employees can’t afford to move back.
Also a lot of people have discovered that no one wants to live in rural areas because they fucking suck. That’s why there’s no people there.
People don’t live in rural areas primarily because of the distance to their jobs and a lack of infrastructure. Otherwise most people would choose rural living over living in a dense city if all other factors were equal.
Closeness to nature, lack of pollution/ city noise, free use of the earth and land, etc.
[citation needed]
I greatly enjoy not having to drive 30 minutes to get groceries or run errands. I very much enjoy dense urban areas where everything is within walking distance or good transit.
Throw in a nice park and some greenery and I’m good. I frankly think most people would pick that than a car centric plot in the middle of nowhere.
For me, it’s not just the closeness of things, but also having a dozen good options for eating takeout, or numerous local coffee roasters or bakeries. I love the idea of living closer to nature on the big island of Hawaii but, it would be rough. To bring the things I love with me I’d also have to roast my own coffee, bake my own bagels and pizza, and brew my own beer. Basically it would be a full time job. I’m happy that these things are still available to me as hobbies, but they are easily outsourced in a real city. And it’s not like you can’t find pizza or beer or coffee on Hawaii, but the quality and variety of those things falls short of what you’d get in a bigger city.
fuck that! give me nyc. I love nature but it’s so inconvenient. it’s something to visit.
Yep it’s awesome to be free of all the hassles of city life, living out in the woods basically with room to do whatever. The air is clean and fresh, and I can piss in the yard day or night.
Being close to a small town, I can even access groceries and restaurants within 10 minutes. Fiber internet is available and affordable. Wouldn’t trade it for any city.
3.25% 30 year… 27 years left.
But I’m OK staying. I’ve made huge improvements. Upgraded the electrical panel from 100A to 200A, added solar panels, added a retractible awning. Hot tub is coming.
It’s a nice house, with a good yard, will be fun to add playground stuff when we have grand-kids.
Not trying to throw shade at your shade, but I don’t think the retractable awning is building a lot of equity.
It’s a freeing feeling when you decide to put money into what you want instead of what has the biggest ROI.
It basically created a 3rd patio space.
I’m one of them. For a lot of reasons my partner and I want to move, but we have a 3% mortgage. Even though we have a large amount of equity, we still can’t afford to buy now. I’m looking a getting a loan from my parents, which is ridiculous considering our situation but almost 8% interest rates mean our payment would just about double from what we have now.
I know. It’s pretty nuts. We’re in the same situation. We want to move, but it makes no financial sense to sell our house with such a cheap mortgage. So we’re thinking about just renting it out for a few years and move into a rental where we want to live until it makes sense to sell. Keep building equity in the meantime. But it may never really make a 100 percent sense to sell.
8%, wow. I remember when it slowly (over years) came down from 17.5% in 1990 in Australia. My credit card at the time had 55 days internet free but the internet was 18.5%, at one point I think it hit 22%.
Credit card rates are similar to that even now in the US but for a while we were at about 2% for mortgages. Mine is 2.75%. Selling this house at some point is going to hurt.
Bought my house just before the crash in 2007. Felt screwed over as I went underwater and was stuck with my 6.5% loan while interest rates and home values plummeted (and because my mortgage was privately held, no HARP refi option.
Finally after nearly 15 years not only go out from under water but built enough equity for a no cost refinance. Got into a 2.25% loan.
Sad part is, despite the lower rate, due to skyrocketing insurance and taxes, my payment is no cheaper
Taxes and insurance is what will knock a lot of us out
Lucky 'mericans. In Canada, fixed mortgages are still renegotiated every 5 years or so, nearly every homeowner with a mortgage is getting wrecked by the interest rates.
We get wrecked by other things. Healthcare costs is my wrecking ball.
I’ve found a simple fix for this by just not getting medical care ever
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In the UK, we have various mortgage products. You can choose to track the national lending rate (plus some %), standard variable or fixed rate for various periods. Of course they calculate the rates for the various periods based on risk.
Right before the rates really started going up, we managed to get 10 years fixed at a very reasonable rate. The mortgage advisor thought we were crazy and that this was “all going to blow over in no time” and was advising a tracker until “the rates returned to normal”.
So this could actually trigger a crash if many need to sell but can’t buy.
Variable rate mortgages and loans are also available. They have not been as popular in the past few years, but when rates were lower, they were more common
You’re absolutely correct!
Its less of a problem of lock in here in Australia. Our rates tend to only be fixed for the first few years. Then you go to the variable rate. We have an opposite problem, where we have what’s known as a mortgage cliff. People who signed up at affordable repayment amounts end that lock in period and have payments jump significantly. Some are forced to sell.
Being locked in seems better than being forced to sell.
I would like to introduce you to 2008…
Yes, just America was affectednbynthe global financial crisis. Unless you mean the sub prime rates, which ISNA different thing than fixed rates. Usually those on a sub prime rate are on a higher rate not lower.
Here in Germany you can decide how long you want your rates to be fixed, with the tradeoff being that longer times of fixed rates usually have slightly higher rates (in German its Zinsbindung).
I am lucky and happy that I chose to do 30 years fixed rates, after those 30 years I only have like 2k€ left anyway, so it doesnt matter what rates I get then really.
The dropping interest rate is one of the main reasons that housing prices have skyrocketed in the past 20 years. People judge housing prices by what they can afford monthly and interest rates directly impact that figure. It’s only a matter of time for housing prices to fall drastically if interest rates remain at 7%.
And yes, I have a 500k loan at 2.5% on a 30yr fixed mortgage. Maybe we’ll sell our house in 15 years, but otherwise, forget it! I have zero interest in paying it off early.
2.75% here. Yeah… I don’t like where I live but I ain’t moving unless I have to
