$5 million for a house? I haven't looked recently but for most parts in the US, that sounds like outside of normal range. I know for a fact that our house is not worth $5 million.
You need $5 million to afford a $1-2 million house if you want to have any money left over for retirement and emergency medical expenses in the US which can easily bankrupt you. That's not including emergency fund for famine or war given the direction the country is going to go with either of the current 2 president choices. If you had $5 million you wouldn't be smart to blow it all on a $5 million house, either.
Houses cost $1-2 million in any city that actually has jobs. Yeah, you can get a shack in Kansas for $200k but good luck finding work there.
Nothing wrong with renting, it's not gonna come with a bidet though.
I don't understand how this comment could even be made in earnest. Normal people don't buy their house with cash, they get a mortgage with a reasonable down payment and a monthly sum they can afford.
Your claim here is that someone who is buying a house, likely early-mid in their career at 25-40 years old, needs to pay for a million dollar house in cash while also having $3-4 million dollars additional cash reserves? For retirement, which they won't be doing for 30 years? What?
> Normal people don't buy their house with cash, they get a mortgage with a reasonable down payment and a monthly sum they can afford.
And this is why "normal people" are broke.
I don't buy stuff with money I don't have. It should never be "normal" to do so.
> For retirement, which they won't be doing for 30 years? What?
They job might be obsolete in 5 years with AI on the horizon.
War may break out given the current incompetents for presidency.
Climate change is happening.
If I had $1 million I would be saving it up and investing it for potential hard times coming, not blow it on a $1 million house.
If I had $5 million, sure, I might throw $1 million of it at a house.
The only time I would take a loan is if I have the cash but I believe I could significantly beat the loan interest rate by investing the balance in something else, AND I have other stable assets in case my plan doesn't work.
Having a mortgage on a house doesn't make you "broke". Just because you are exceedingly conservative with money doesn't mean your standards preclude the average person from obtaining a home.
If your net worth is negative, you are literally, by definition, broke.
If you took out more loans than you have assets, you are broke.
Yeah, the US economy is f'ed up, roofs to live under should not be this expensive. If you think a huge fraction of the economy borrowing money at high interest rates to have basic life necessities, despite being employed, is normal, you have been brainwashed by the system.
If you take out a million dollar loan for a million dollar house, then your net worth is 0. Which is actually a pretty stupid starting point, because most people wouldn't buy a house and get a mortgage without having savings. In other words, if you have $300k 401k, 300k liquid savings, and then buy a $1m house with an $800k mortgage then your net worth is $400k + $100k + $1m - $800k or, in other words, +$700k.
Yes some people push it, no that's not what I'm talking about, as your argument was that you must have enough assets to purchase a house cash before you can "not be broke buying a house."
390k 1,000 ft starter home, two bedrooms two bathrooms, in a literal beachfront town in southern California where you are at most a 10-minute walk from the water. Oh you're picturing something more mcmansion like, sorry that may take a little extra creativity and luck. But you absolutely do not need to spend 2 million, 1 million or even half a million, to live in a highly desirable area in this country. It took me all of about 30 seconds to find, granted I live in the area and have a general sense of where to look for something like this but zooming around the map will find dozens of such examples.
This house is 390K. A few pennies short of a million much less 2.
All in, because sellers pay all fees so the price shown is 95-100% what you pay.
With decent credit you could get this with 10% down, now 40K in the bank is not exactly couch money but it's nowhere near beyond the reach of a single person, much less a couple, before kids and who jointly make an absolutely reasonable 70 to 90k combined given the area that you'd be in.
a-There are very few jobs in Carsbad unless you want to work at a fast food joint. Commuting from there to San Diego or LA (where there are jobs) is not realistic. Being a 10 minute walk from the water doesn't buy you food to eat, unless you plan on fishing every day, nor does it pay for property taxes and other idiotic fees.
b-Buying stuff with money you don't have should never be the "default" way to do things. If you don't have the cash you can't afford it.
