[millenial4freedom]

smells like the 'hope and change' from the Obama era...

[dfwgator]

And I’ll be waiting to scoop up those properties on the cheap when they all default.

[Steely Tom]

Funny.

Be more accurate to say “I can pay it back with inflated dollars in the future.”

[EEGator]

I done can’t read good no how…

Are they stating $7K a month?

[hinckley buzzard]

The DC market area, wealthiest zip codes in the land. Who cares what they pay. They apparently don’t.

[cableguymn]

It’s happening on car notes too.

Unlike real estate cars rarely appreciate and even though I warn people they still think the car will be worth more than they owe so they can just refinance it.

[wardamneagle]

I assume a min down payment of 5% @ $35K or 10% @ $70K or 20% (you get the picture) wasn’t included....

[alternatives?]

I wonder if they have considered the odds of one of them losing their six figure job?

[Hazwaste]

It’s ok, the baked potato in the White House will soon offer Fed mortgage forgiveness for people who over-committed.

[pangaea6]

Middle class is now $270,000? Wow! I just fell way behind

[JonPreston]

I think I’ll find a nice beachfront house and become a squatter.

[Oscar in Batangas]

Buy your wheelbarrow to haul tomorrow’s dollars round in today...before that price goes up, too!

Buckle up, folks

[DEPcom]

” they’ll simply refinance to a lower payment once mortgage rates, presumably, come down.”

From 2002 to 2005, individuals were engaging in interest-only mortgages, anticipating an increase in home values and the opportunity to refinance once interest rates decreased. Unfortunately, many of these individuals faced foreclosure and lost their homes in 2008.

[unread]

If that’s middle class making those kind of payments, I must be one poor dirt grubbing hillbilly..

[Do_Tar]

“Bank Loan Officers Approving $7,000 Loans For Middle Class Buyers”

[Presbyterian Reporter]

“””they’ve already concluded that these high mortgage payments will be “short-lived,” and they’ll simply refinance to a lower payment once mortgage rates, presumably, come down.”””

---

For those of us who have been around for a few decades, today’s 6.9% mortgage interest rate would have been a steal during the 50 years from 1960 to 2010.

[ronniesgal]

does the title say 7k? i’d grab that up 2.

[joma89]

And when they all default, who do you think will foot the bill? The taxpayer of course.

[Brian Griffin]

“The call I just had was a typical area household. One person makes $150,000, the other makes $120,000. So $270,000 total and they said a payment goal of $7,000. I’m still not used to hearing people say that out loud,”

That’s $84,000 out of $270,000, or about 31% of their income.

To pay $84,000 a year in order to get $270,000 a year is a pretty swell deal.

Areas like metro DC have pretty premium jobs and one should expect to have to pay premium housing prices in areas that have lots of premium jobs.

[Tom Tetroxide]

‘always refinance when rates come down in the future’

Problem with that is rates run in 40 year cycles. 1940 to 1980 rates went up. From 1980 to 2020 they went down. Now they are headed up probably until 2060.

[TomGuy]

Sounds ominous, except that a 5%-6% interest/mortgage rate was historically considered 'the norm' going into the Carter years and 8%-10% was 'the norm' until the GWB real estate crisis that shrank interest/mortgage rates to historically low levels.

1920-34 near 6% mortgage average¹
1935-45 just under 4.5% mortgage average¹
1960 - 5.1% mortgage average²
1971 - 7.3% mortgage average¹
1980 - 13.7% mortgage average²
1981 - 16.6% to 18.45% mortgage average²
1990 - 10.1% mortgage average²
2000 - 8.1% mortgage average²
2010 - 4.7% mortgage average²
2020 - 3.1% mortgage average²

sources:

¹Mortgage Rate History: Check Out These Charts from the Early 1900s

²Here's how much home prices have risen since 1950