The problem is that while you’re being frugal and saving, the house price keeps going up. The longer you save the more you have to save and the less affordable it becomes. If you buy sooner you get that appreciation.
But where is that “average (NEW) house” price of 400,000.00 coming from?
The “math” looks very different when you use a 150,000.00 or 100,000.00 starter used house rather than of the average price of over-hyped new suburbs offering over-sized and over-built McMansions.
20 year mortgage. Condos or mixed-plan apartment style places that you purchase.
I know ALMOST NO ONE who could do a $2800/month mortgage payment.
I guess find a a small box???
Great advice, but as usual people only want to hear what makes them feel good.
Those who have a problem with what Ramsey had to say, and instead refuse to listen to his sound financial advice, will one day find themselves in the poor house wondering what happened.
Yet, in the end times people will hire teachers who will scratch their itchy ears. This is a reference to the endgames in the Scriptures, but it is good advice in all matters relating to one’s life.
Do not listen to anyone who refuses to tell you the truth. Fact is, the truth may not be what you want to hear, but in time it will make you satisfied if you head the advice.
You don’t get a $400,000 house as a starter. You live a little farther from the city and get the $200k house or a mobile. Dave’s advice is excellent and will work for most reasonably employed people. The author of this article is a dope.
Ramsey is a jerk who berates his callers. Calls himself a Christan.
He shilled for that Time Share Exit team who are facing a class action suit. Time Share Exit team basically stole $4,500 from me. They told me to stop paying the maintenance fee for my time share in Vail. I did that for years until ultimately I owed the time share $17,000! Oh but TSET was “we get you out of your time share or your money back.” That’s a lie. After 7 years I tried to get my money back and they claimed that since I didn’t fill out some form in 2019 they would not be giving me the refund.
I ended up negotiating with the time share myself and they let me out of the contract for a mere $2,000. The time share person said the TSET never even tried to contact them! The TSET is just some crooked attorneys. I think the name is Reed/Hein.
And Dave Ramsey is an asshole for recommending them.
Reddit is a leftist site. They HATE Dave Ramsey. If you did a poll about buying a house, most of the respondents would say that the government should give you a house.
No one on Reddit would admit that Dave Ramsey’s home buying advice is made difficult/impossible due to Brandenomics.
Your first home shouldn’t be a median home. It’d be on the lower end. Then, 4-5 yrs later, you sell it and roll the cash into your next house.
Want to buy bigger but can’t afford the monthly?
Get roommates.
Stop expecting to live at the same standard your parents had obtained after decades of saving.
“U.S. homes sold in Dec. 2023 went for a median price of $402,045, according to Redfin. For simplicity’s sake, let’s say you buy a $400,000 home”
When you start with a bad premise, the rest of your argument is flawed. For your first house, you don’t buy one for the median price; you buy a cheap house that might not have a three-car garage, bathrooms for each bedroom, and 3,000 square feet.
I don’t know Dave Ramsey but the advice given here is solid. If you can’t make the numbers work, just don’t buy a house. (Buying a house and then going broke is not fun.)
This advice was a lot easier to follow 50 or 60 years ago when homes were a significantly smaller multiple of the average annual salary.
Exactly what part of everything do you deserve?
People who save 10% of their income give up buying cokes at gas marts, fast food, energy drinks and budget for georcies. They drive old cars and keep phones til they don’t work.
Stupid people feel like a burger, then a candy bar and soda 2 hours later. Entertaining yourself with a credit card is what college grads do.
And the average home was bought by someone who sold their other lower value home and can use the equity from that as a down payment which will drastically reduce their payment on that 15 year mortgage.
If you are going into the market looking for a $400,000 as a first time home buyer you are going to have to indeed make a major amount of moola.
You start small and build up.
If you can’t afford to buy a house then dont buy a house. I don’t know where this mentality of “OMG, I graduated from high school/college last week and I still don’t own a house” came from. I remember seeing a post (not here) from a woman whose son just joined the service and was stationed in San Diego and she was bemoaning the fact that wouldn’t be able to buy a house. One, if you’re an E-3, you shouldn’t be buying houses. Two, you’re in the military, you’re going to be moving around a lot.
Basically what he’s saying is if you can’t afford a home, you shouldn’t buy it. The snowflakes can’t accept that. This is one of the reason home prices are though the roof. Today’s generation can’t do without.
It may be “sound” advice, but it isn’t “practical” advice.
Using Ramsay’s formula, only 25% of Americans could afford an “average” home in today’s market. That is after, according to his formula, they save the $80K downpayment.
If they were able to sock away 10% towards a home...this doesn’t include the 10% you are ALSO supposed to be socking away as a rainy day fund AND the 10% you are supposed to be socking away for your retirement AND the 5% you are supposed to be socking away for your kids college fund. This, and taxes, turns your $135K into about $60K. You could do okay with that in New Mexico. It would suck to try to live on that in Florida.
While I love Dave Ramsay, I remember my financial planner and my accountant both being dismissive of him. There are some people, in some parts of the country, in some circumstances, who can follow most of his advice, I was told.
A person has be clear-headed about what he’s doing — is he buying a house for lodging, or as an investment. If he wants his own place to live as soon as possible and the most desirable as possible, then buy the best he can afford with as long a mortgage as it takes, and enjoy. If interest rates drop later, he can always refinance. If he wants an investment then buy the fixer-upper, fix it up and flip it. Trade quality of life for financial gain. But right now it’s very hard to have it both ways unless he has a large cash position.
I listen to Dave daily...and I also agree its sound advice.
The problem I would be facing if I was in the market for a home though....is the possibility of homes getting more and more expensive in line with my saving more and more money....making me basically on a savings treadmill for an ever increasing home price.
Even according to Dave Ramsey...he sees no dip in home prices, and that they will continue to gain in value with no end in sight.
With that in mind...jsut to buy a home that would comfortably fit my family...I might violate his advice with all this in mind.
Each person is in competition with other members of his age cohort. Higher paying jobs go to more accomplished people.
Yet the GOVERNMENT RUN education system instructs their students to be equally mediocre.
Since no one stands out, employers pay as little as possible for talent because mediocre skill levels are all that are available.
If students would realize they are in competition for their way of life, they would reject the exhortation to mediocrity.
But the lure of more "snow days" is irresistible.
This is a classic case of killing the messenger because the message is not what you want to hear. Bottom line - Most can’t afford to buy a conventional family home anymore. The Left has wrecked the dream of home ownership too.