Well that's the issue. Chasing a mortgage payment inflated asset prices. It distorted what people could buy. I'm not saying you over bought or overbid, but a ton of people did. If you refinanced on a home bought before 2021? Yall absolutely made out like bandits.
You’re not enjoying lower mortgage payment. You’re enjoying lower interest rates with higher inflated prices that you can not refinance any lower in the future. “Date the interest rate, marry the home price”
I don’t know who thought it was a good idea to bring mortgage rates up to 6%. And the fed is raising it even more. I wouldn’t buy a house now even if prices went down by 50%.
@baldeagle4710 That's absurd and short sighted. If the price falls low enough at a higher rate, then you're better off in the long run since you're going to get better appreciation. If you bough at the top of the price curve, because lower rates made you afford it? You'll lose appreciation in a correction at a 50% drop. Why wouldn't you buy the cheaper priced asset? This is why rates should never be 2% because it distorts people's idea of what nominal rates should be.
I have a 2.75% 30 year mortgage and my home has around 50% equity. I will own this house 1) until I drop dead or 2) until it is paid off (and I will never pay a penny more toward the mortgage than I have to). I'm sure there are many many just like me.
I don't feel trapped. My low interest rate of 2.6% allowed me to finance my $300K loan for 15yrs. I also was able to put down 20%. I already have over $100K in equity after only 18 Months in the home.
that's awesome -- as someone who didn't buy when rates were low I can tell you I'm envious :) -- but happy for people like you who found a house you like at such an amazing rate.
@@mrwilliamwonder Right, but even if he was forced to move, he's still not trapped. Let's say he bought a home back in 2011 for $475K. Let's also say he's been working from home, his job is located in another city (my situation), but they are now insisting that you've gotta come into the office four days a week. Ok, great, he goes to sell and he gets $745K for his home, pays off the $475K (he wouldn't have hit the principal at this point) and takes the $270K and buys into this high interest rate market. But again, he's got $270K to lower that mortgage. To make things even better, if I were in that situation, I'd get an adjustable rate mortgage, which have lower interest rates and would refinance with rates come down. Sure, ideally you'd prefer to just stay where you are, but in this situation, you're far from trapped if you have to move.
We built 16 years ago a very nice 3000 sq ft home for a little over $100 a sq ft. The same house now would cost around $225 a sq ft and my interest rate is locked in 2.5% vs the current 7%. Long story short I and I would gather many others don’t feel “trapped” in our homes just because I don’t want to pay the housing machine and banks hundred’s of thousands of dollars more in interest payments and price gouging falsely marked up material and building cost.
Can’t buy my first home as a 24year old everything is overpriced and the interest is higher. On top of that there’s barely any houses up for sale near me.
Trapped? I don't think so. I'm enjoying my low, low 2.25% mortgage rate in my mountain home located in the Rockies. In fact, that 2.25% mortgage rate is very liberating.
I feel a bit trapped. We love our home, but we want to purchase the "forever home". I can't help, but think how much cheaper the monthly payment would have been had we purchased sooner. I wasn't expecting mortgage rates to increase that fast.
Mine is 2.00%. With 12.8 left. I’ve been buying 4% CDs with my extra payment. Will pay down my mortgage when the roll over rate drops. (I know it’s not the Ramsey method).
Exactly, I’m at 2.25% here in Southern California. My mortgage payment for a 3200 sq/ft home is now the same as the 700 sq/ft apt we moved out of 5 years ago. I cannot believe people have to shell out $2500 - $3000 to rent a 2 bedroom apartment these days.
I don't feel trapped. I got a good price and fantastic rate on a starter home that helped me to get out of an apartment. When I upgrade, I plan to keep it for a rental.
Now that’s what I’m talking about! My wife and I bought our forever home 5 years ago, and 2 years ago we refinanced it down to 2.45, and bought 2 rentals and have those at 3.25! Smart, have someone else build your equity for you! That’s how wealth is created!
@@dmkfactor1721 the wannabe landlords think they're better than anyone else. that's also how you destroy a whole generation. rents and home prices are coming down very soon. prepare if you bought a overpriced property.
There should be a law that seller credits must be disclosed with the final sale price. A house that sold for $400k but had $20k in seller credits should have to reported as being sold for $380k. It artificially inflates comparable homes.
Feel trapped? You kidding me? No… we feel lucky and happy where we are. We’re at a ridiculously low 2.25%. There’s no trapped with that. The trap, is needing a home, and having to search with 7%+ in your future.
We bought our starter home in 2020 @ 3%. Because the market was crazy, we bid on over a dozen houses and overpaid for the one we got. The house has most of the core things we wanted but, if the interest rates weren't as crazy as they are now, we would likely be looking for a new house early next year. Instead, we're waiting it out another 2 years to see how the market shakes out.
@@billbigshlong382 maybe if you live in a state that allows the homeless to poop in your front yard, but I assure you prices are not going down throught the country
I dont feel trapped at all. Rather relieved and counting all my blessings. I have a 1.99% mortgage 15 years refinanced in 2021 originlly bought in 2018 @ 3.875% 30 years. Now with $130k equity in a little over 5 years. The original price was around $200k (starter home) Im just incredibly lucky as I timed the refinanced just right. It helps when you listen to the wife. 😅
“Trapped” is not the word. It’s more like they are not motivated to sell. They will sell if something changes in the market (greater inventory, lower rates) or in their lives (marriage, divorce, family death, financial pressure).
Yep, that's us. We have a 2.875% mortgage rate currently and moving to a new/better house, even at the same mortgage loan level, would increase the price about $700 just due to higher interests. Again that's for the SAME amount of total debt on the mortgage if we moved.
Yep. I was in a 30 year mortgage but about 5 years in at around 4%. When those rates dropped in 2021, I was looking to sell and buy because I wanted a one story house instead of my 2. But the inventory was ridiculous. So, I said screw it and refinanced with a 2.65 and 20 years. Best decision ever. Didn't take out a dime. Now, I have a 4 bd rm, 3 bathroom, 2 car garage in a gated community in a south Florida neighborhood with excellent schools and no crime for 1,670 per month. I am not getting out of this PERIOD! I One would be nuts to take on a 6-7 percent mortgage now after being in a 2.xx percent.
Good luck with your homeowners insurance doubling every year!! Also when your house gets it's new appraisal for property taxes I'm sure you will feel so grateful.
@@kjay5056 you type that like you are just hoping all these things happen to my household. Nevertheless, for now, we are good to go. My wife and I both easily make well over six figures. With that in mind, I hope we will still be fine and still are grateful in comparison to the BS others are having to put up with around us. But yep... Keep hoping and wishing everyone falls down in the same sinking boat all because a few are hanging on in a life boat. What we are anticipate is not inevitable. So, until that bridge gets here, we march on and still remain positive and for now, comfortable.
The effects of the downturn are beginning to sink in. People are being impacted by the long-term decline in property prices and the housing market. I recently sold my house in the Sacramento area, and I want to invest my lump-sum profit in the stock market before prices start to rise again. Is now the right moment to buy, or not?
Don't depend your market assessments and decisions on hearsay and rumors; I did it in 2020 and ended up with worthless market holdings. Before I started noticing any notable improvements in my portfolio, and I had to completely rebuild it. I've been using the same advisor ever then, and in just two years I've scaled up to $876k. Depending on where you look, a bullish or down market might both produce good profits.
@@carssimplified2195 Thats a good one. I know a lot of folks that made fortunes from the Dotcom crash as well as the 08’ crash and I’ve been looking into similar opportunities in this present market. Could this coach that guides you help?
@@Justinmeyer1000 My Financial adviser is ‘’Christine Jane Mclean’’ she’s highly qualified and experienced in the financial market. She has extensive knowledge of portfolio diversity and is considered an expert in the field. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market
@@carssimplified2195 Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Hard to make broad statements about real estate now. Our metro area on the east coast has a huge supply shortage style. No measurable decline in property houses here.
Roughly £120k in my portfolio are in tech/TSLA stocks, can I get an advice on any other stocks that I can acquire to diversify my reserve across multiple markets while creating a comprehensive portfolio allocation that balances my concerns of risk aversion and returns that meet yearly inflation.
You need to hire a financial advisor to help you diversify your portfolio by including Mutual Funds, Etf's, the 11 GICS groups, inflation-indexed bonds, and stocks of companies with reliable cash flows rather than growth stocks, where prices were based on future prospective earnings.
@@chloeanderson543 That's correct. At first, I wasn't too pleased with my gains compared to my previous performances, I was doing so poorly, I thought I needed to diversify into better assets, so I got in touch with an investment-advisor. That same year, I pulled a net gain of £550k, which is about 10 times more than I average on.
@@kalfmanbrown5953 My portfolio has been in the gutter for the entire year, so I started researching new ways to profit in the market, but everything I tried just seemed to miss the mark. Please let us know the name of your financial advisor
@@darrenphilip247 Having a counselor is essential for portfolio diversification. My advisor is "Trade with Ethan Grayson" who is easily searchable and has extensive knowledge of the financial markets.
@@kalfmanbrown5953 Thanks for this tip. His handle and website popped up on the first page immediately I searched Ethan’s name, I read through his resume and it seems pretty tight. So, I dropped a message & hopefully he replies soon.
Some countries allow "mortgage porting" which would allow you to transfer a loan to another home. That is not common in the US. Not sure about feeling trapped, but the reality is that I have a 3% rate. My mortgage is $2600 a month. If I were to buy another home and keep the loan amount the same, I'd be paying $3400 a month. If I could transfer my loan, I would keep the same payment and use the cash I get from the equity to cover the delta. Instead, I would need to swallow $900 a month for a similarly priced home, or buy a much cheaper home to keep the same payment in order to move.
Interesting perspective, as I am locked in 2.25 courtesy of disabled veterans refi. I also purchased prior to covid. My main concern is the coming rental frenzy as a option. As well as, whole cash buyers. This will surely inflate prices. Many fortunate homes will mortgage free by 2025. That's when the straw will break the camels back.
My rent went up 30 percent in two years. Same across my zip code. My pay up 3 percent. I have to look seriously at leaving the USA for another country to live in. Neither party cares about the middle class. Go ahead attack me and say don’t let the door hit you on the way out lol
I totally agree with you. I love America, but I may have to retire out of the US or at least out of California. Although I own a house, everything (utilities, petrol, grocery, etc.) just keeps going up. I am doing my own gardening, because I can't afford a gardener anymore. I am scared to turn on my AC, because the electric bill is soaring, I am taking public transportation because petrol and insurance costs are high... it's a struggle living a middle class lifestyle.
@@TrendyStone I make lots of money and spend lots of money lol. I like being able to move wherever I like. I live in a very affluent place so my kids have good schools. When they graduate will move to a cheaper locale
Yes, trapped because why would anybody sell when they have a 2.5% interest rate and buy into a 6% interest rate losing considerable buying power? Also you need to learn the difference between their and there, basic english. Lol
He means trapped because people that have low interest rates can't sell or their payments would spike hundreds or even thousands more for the same house due to interest.
All the comments are disconcerting frankly. It sounds like a bunch of people went and bought homes they didn’t really want or need just because interest was so low. Everyone is trying to become a landlord and it’s all going to come down like a house of cards if people start losing their jobs.
Rates would have to come down to say 4% before I’d think about selling and buying again. We bought our home at a shrewd price which eased the pain of a 5.5% interest rate. With our largely labor intensive improvements we’ve upped our value considerably, but I’m not up for paying 6% plus in interest. If need be we’ll enjoy our newly made castle for years to come.
I wouldn't say I am trapped. I would say that I am now a future landlord. And when prices and rates adjust I will buy another home and rent my current home to help offset the cost of a higher mortgage on a new loan. Me keeping my house as rental property instead of putting it on the market for realtors and banks to profit from is a issue to investors more than anyone.
You missed the point. If people can’t or won’t give up their 2.5% loan they won’t upgrade (buy bigger house or build)…which impacts new construction (and free movement), thus total inventory, thus drives up rent payments. High rates impact everyone.
Just sad that the country is turning even more into the "haves" (people who own a home at low interest rates and constantly gaining equity as home values rise) and the "have nots" (people who can not afford homes anymore because prices are going up way faster than wages). Something has got to give otherwise there will be a revolution or something eventually. Homelessness is no longer just for the lazy/drug addicts but for working class people.
I saved up for my house and bought it with cash. Took 15 years of saving and renting. Imagine that, you save for something...then buy it. If you can't afford to rent, then you can't afford to own a house.
When you add in all the costs of owning a home/house (insurance, maintenance, repairs, roof, furnace, mortgage, taxes...), the economics will almost always favor renting over buying. However, people want a "home" and to know that they can choose to live there without the threat of having to move and for life stability, but, you should first rent until you save the coin to comfortably buy. @stevenk195 is spot on.
I don't think I've ever seen two stupider posts on home ownership vs renting in my life. First guy says "if you can't afford to rent, you can't afford to own" (which is probably true, but it doesn't really show much sympathy for people who can't afford to rent--where are they supposed to live)? Second guy says "the economics will almost always favor renting over buying" but seems to forget that the REAL value in owning a home is the fact that your mortgage rate never goes up no matter how long you live there. Try renting a place for 30 years and see how much money you end up shelling out.
@cozyslor not even close bc if they equal the same which they typically do..I'm getting at least my money back when I go to sell due to appreciation..when you leave your rental all you get is a thank you from the landlord
@@User.9.459 This analysis makes zero sense. First, there's no guarantee your property will appreciate, and doubtful inflation adjusted. If Rent = Mortgage then your home better appreciate equal to or greater than the expected return on your down payment if it were invested. Now add in the money it costs to maintain a home, insure a home, etc...Here's a question for you; If I have a $500K 30 year fixed mortgage @3%, and I have $500K of cash, would you advise me to pay off my mortgage?
I live in LA. Got a home for 3.125% interest rate and paying just a little bit above your average rent. 100k+ in equity in 2 years. I'm not trapped, I'm set.
housing is about 30 % higher than it should be. maybe even more. let’s be honest… everyone just been buying homes to live for free in the long run. thinking this home will get them another one. pretty much low interest rates for the past 15 years. your 3% mortgage won’t matter if your property drops 20%
😂😂 exactly, I'm seeing a bunch of newly purchased homes going up for sale in my area. The appraisal values are estimated to drop. Which is likely to happen. Got an email from a homebuilder recently, who has inventory, showing prices have significantly dropped. Pricing was too high and now that speed bump hit and was left holding the bag. Can't ride in a boat upside down for too long. If you got a low low price and good interest rate, hats off too ya. But an overpriced one....ehhhhhh.
Yes, please free me from this burdensome trap of low interest payment. All I really want was to be free to pay more of my money in interest and enrich the banks. Sucks to be me.
"Trapped" is another way of saying that many are just out of the selling market. Many buyers out there are trapped because the supply is so low and the price of entry is too high. It's a stalemate until something breaks.
Exactly. Everyone with a property at a rate under 3% feels fortunate and was smart/fortunate to take adavantage of those rates. The folks who are trapped/screwed are the buyers. High rates and low supply = bad environment to be buying.
What makes him think people assume that houses would be selling of at 7% interest rates? The only reason housing sold off in 07 was because from 04 on most mortgages where adjustanble rate mortgaes and people were forced to sell. This time most got the 30year plus a bunch of cash out to beef consumer spending. The real fear should be when people run out of all that refi money and have to soley depend on there wges to beef up the economy. That will be scary beacuse for the past 20 year or so people have used refi money to spend like crazy.
@@DanielRicany Yes. demand will go crazy, buying and selling. But first their will be some pain. That will be the catlst of the rates dropping. they dont just drop rates for the fun of it. So there will be a crash while they drop the rates followed by the mother of squeezes in stocks and house prices.
The market is getting back to normal. people seem to ignore that before 2008, when we had mortgage rates near where we are now, people would stay in their homes longer than they do today. Since 2008 with historic low rates, it was easy to jump from home to home, and home builders really pulled back on new construction. I wouldn't be surprised if we see new home construction steadily increase and maybe get back to pre-2008 numbers. Also, we might see the reintroduction of starter homes because low-interest rates were causing starter homes to disappear as you could get a lot of house for fairly cheap prices. now with normal interest rates, the amount of house you can get or afford is going to shrink.
I dont mind renting. In my area most houses seem like a massive pyramid scheme. You get an over priced home with a high interest rate. Plus on top of it you pay massive property taxes that have doubled in the past 5 years. Dont forget that huge HOA fee each month.
Broker valuation will take apple to apple comparison.. even Zillow had dropped inventories in 2022 due to this trapping concerns. As a free agent you can be more flexible in renting..
Trapped?? The people who were smart enough to get those homes via their main mortgage or a re-finance then "planned" on being there a long time and not selling.
I refied in 2019/2020 from 4.7 to 3.1 and put my house on 15 years from a 30. Bought my house in 2016 for $148k and now it’s apprised and all other homes in my neighborhood which some have sold in the past couple of years for over $300k. I’m not trapped at all just smart enough to know I cannot get or afford anything better than what I have, and why lose my $200k in equity and “pay up” for something else at 7.2 apr. I have no reason and it would not be smart to do so as things are currently
@@kidwichita what layoffs? Unemployment is below 4%! This isn’t 2004 when IF you got laud off you had no hope. Now you can turn on an app and join the gig economy!
Same goes for folks that bought 0% interest cars and trucks for 84 months right when the pandemic hit. Those folks are going to drive those cars and trucks into the ground because of the rate! It's not being trapped, it's just hedging yourself against inflation for a duration.
One is only trapped if they bought something they never liked, now are upside down, or have a student loan about to come and can’t afford both. I don’t think there’s a ton of that. Trapped is the renter waiting for better inventory hitting the market. Why is anyone talking about how renters are trapped.
Considering the current 7% to 8% rates. And over priced low quality homes being built and sold. We are happily trapped in our home. We can upgrade a few things we always knew we needed. Because paying more for less is not an option.
Columbus Ohio is too expensive! A safe and clean 1 bedroom apartment is over $1,000+/Month. Most people cannot afford this on the crappy wages! Wages would have to be $25/Hour and up for any job to keep up with criminal rental gouging and inflation! PAY gouged pricing to Play ( live ) is a crime system!
There is no shortage of homes. Demand is dead. Nobody is buying. Builders have added record numbers of homes to the market. Supply is climbing across the country. Prices will continue to decline for the better part of a decade.
The Federal Reserve has created damage to single family homes by distortion of interest rates, keeping interest rates at 2% for years to long. This causes bad behavior just like we saw people bidding a house prices to ridiculous prices. The federal reserve still hasn’t corrected this huge disconnect with interest rates and housing. The long-term fixed rate mortgage rate should be 9.0% to 10.0%.
You said it! Interest rate was too low for too long. The Feds had good intentions, but were very short-sighted in their thinking . Almost everyone locked in these ridiculously low rates, and now no one would sell, thereby causing extremely low inventory, so prices are not budging. Just terrible. Yep, I support 10% Interest rate.
No, the politicians created strict lending regulations after 2008, and since then, building never was able to keep up with demand. Let’s stop pointing finger at interest rates, corporate rentals, inflation…. and let’s address the real issue, which is regulations. For decades, liberals were wanting to more like socialist European nations, and with each vote, they get close and closer to Europe, but Europe are very expensive renters nations. People that vote democrat, are people that want more regulations, and they have to know it’s ultimately going to cost a lot more. So, if you vote democrat, don’t even complain, and embrace the high prices, because this was a conscience choice.
Those who feel trapped did not make a wise decision about the home they purchased, or were flippers thinking the financial market would never change. Realtors want people to keep moving around because they make bank on every transaction & keep people behind the 8 ball making payments forever without ever owning their home outright. I's really sad people don't understand how the whole thing works.
I don't know of a single prospective buyer that doesn't dream of being 'trapped' in 2.5% 30 yr mortgage; at 2020 prices to boot. The winners. Now, it's really tough. There are no easy answers for missing out on that opportunity.
Actually no, homeowners with 2.5/3% rates are allowing new owners to assume the old load, dont ask me, ask a mortgage broker. The trap is the soaring home pricings, which will always be an issue. Basic supply and demand.
That’s the absolute problem (or opportunity) which is that it costs $1000 more per month to own a home than to rent a home. What he left out is that these are basic entry level homes for people making under $100-200k/yr. It’s cheaper to rent.
Renting can be as much as buying in certain markets but not everyone can qualify for a mortgage. However they maybe renting g at the same amount they would be paying for the mortgage that they don't qualify for. Happens all the time. So they are forever renters. They are the ones that are trapped.
trapped is a terrible term......people are not trapped they just are not incentivized to upgrade homes....mine...will pay my 2.125% loan in the next year...then be debt free....
Id say air Bnb is hurting supply. I’ve been to about 50 home units that are rented rooms with electric locks on each door rented through air Bnb. Multiple that by 5 % by county and the numbers are astronomical. Go look at air Bnb see how many homes are rented rooms strictly for profit. It’s sick.
Mine is 3 and a quarter. Got it done early 2021 before everything went to hell on inventory and interest rates. I have 280k in positive equity. This news report is for people like the guy I work across who hates my guts. He's gen z, morbidly overweight, and underperforms and has no hope for the future, and he hates my guts because he thinks I think "I"m something Im not" This report is dished out in true ESG/DEI bs fashion, for weak people to think they have ammo or even could hold a candle against the productive among us. The same people who get mad about fat shaming, and people not respecting their pronouns, and being gullible to eat this up. I guarantee you nobody in my position feels "trapped"....but meanwhile, have fun projecting while the rest of us keep it moving.
Duplexes are worth double than a single story home in Toronto so an upstairs addition for 400k would dramatically raise the value beyond the 400k invested
Not trapped. My 3.75% rate is helping me avoid horrible inflation and the builders and banks that are taking advantage of it and price gouging their customers.
People can't sell because they have such low mortgages so moving up or downsizing is a non-starter.. It means most of the housing market is reliant on new builds right now which is problematic in a lot of areas because of the amount of red tape and laws.
Can you tell, till how long they are trapped? Because, as I see if the rates go down the home prices will further go up. One way or the other these rates will bite everyone. Some today and some tomorrow. It’s just a matter of time.
The country is short over 5m houses. Once that demand is met, then prices will go down. This all started the 2008!housing crash, when the politicians tightened lending regulations. I mean, when you regulate something like this, it is definitely going to have a major impact on prices. Essentially, if you vote democrat, this is what you voted for, so do not whine about high prices.
What an Asinine statement and thought process!!! You should feel fortunate to have a two percent mortgage in this high interest environment. No need to over pay for a house when you can wait until this foolishness is over.
People are missing the point. They buyers who feel trapped are the ones who need to either reduce their living situation or grow it according to their family needs. For those that NEED change, theyre in the same shoes as fthb. Low inventory and hight rates. So they have to stay with what they have. Thus further feeding low inventory.
Our first loan in 1987 was 14% adjustable. We suffered for awhile and finally were able to remortgage a few times in 30 years to keep bringing it down. We moved 7 years ago. We were lucky to get a home (in a different state) that was a fair price. We did refinance after 5 years and now have a 2.99% loan. Considering how much we have paid in interest on our first house it's nice to finally catch a break. And yes we will die in this house and our children will split the money.
Not trapped. You can go buy a new home and put the current one on rent. You can offset the high interest cost on new home with any net income from rental home with low interest rate. It’s pretty simple if ur in the position to do it. Also u can refinance the new home year or two from now when the rates come down little bit.
How are they trapped? They have at least a 50% equity and the ability to refinance later after a purchase. The only issue is finding the perfect home...
It's kinda dumb at this point to say that it's hurting supply if new housing is not being built to actually meet demand. Right now it just seems to be re-arranging the deck chairs on the titanic as it's sinking (in this case, the real estate bubble popping).
Americans traditionally carry too much house, a smaller property with much lower maintenance cost is the right choice for most people, this is a good trend and hopefully continues.
If home mortgages traded like bonds I’d be open to moving again. I have a 2.49% 30yr fixed rate mortgage and owe $320k (home is worth $600ish). The bank sold my loan to the Fed, and if they would take a steep cash discount to settle the note I’d do that immediately. Technically, the value of the mortgage should be marked down significantly given that current mortgage rates are 3x higher.
2.25% on 15 years mortgage with Almost %50 equity, not selling and not moving. If i need more rooms i will build more rooms, 7% interest rate on house for 30 years will most likely be a financial suicide.
We aren't trapped. We were smart and are enjoying much lower mortgage payments.
Well that's the issue. Chasing a mortgage payment inflated asset prices. It distorted what people could buy. I'm not saying you over bought or overbid, but a ton of people did. If you refinanced on a home bought before 2021? Yall absolutely made out like bandits.
You’re not enjoying lower mortgage payment. You’re enjoying lower interest rates with higher inflated prices that you can not refinance any lower in the future.
“Date the interest rate, marry the home price”
I don’t know who thought it was a good idea to bring mortgage rates up to 6%. And the fed is raising it even more. I wouldn’t buy a house now even if prices went down by 50%.
@baldeagle4710 That's absurd and short sighted. If the price falls low enough at a higher rate, then you're better off in the long run since you're going to get better appreciation. If you bough at the top of the price curve, because lower rates made you afford it? You'll lose appreciation in a correction at a 50% drop. Why wouldn't you buy the cheaper priced asset? This is why rates should never be 2% because it distorts people's idea of what nominal rates should be.
💯
I do feel trapped with my 2.8% interest rate. Oh poor me.😂❤
2.25 here. I am staying put because Im not stupid
3 here
@@danettewelborn5577 , same here
😄😄😄
Oh no poor you. I don’t have it as bad as you I’m stuck at 2.999%
I have a 2.75% 30 year mortgage and my home has around 50% equity. I will own this house 1) until I drop dead or 2) until it is paid off (and I will never pay a penny more toward the mortgage than I have to). I'm sure there are many many just like me.
Speaking the truth there.
Same here. 2.75% on our 30 year VA mortgage.
Same. I'm at 3% purchased in 2019. I'm happy.
I downsized. Sold my big home and bought a smaller one for cash and now live off the profits.
Same here re: great-great rate on my house. We're not leaving 'til we're heaving !
He said trapped but I think he just means we aren’t going to get a good deal like we did ever again.
People will hesitate greatly
yup, haters gonna hate.
I don't feel trapped. My low interest rate of 2.6% allowed me to finance my $300K loan for 15yrs. I also was able to put down 20%. I already have over $100K in equity after only 18 Months in the home.
Because you have no desire to move. Others must move for a myriad of reasons.
that's awesome -- as someone who didn't buy when rates were low I can tell you I'm envious :) -- but happy for people like you who found a house you like at such an amazing rate.
@@mrwilliamwonder
Right, but even if he was forced to move, he's still not trapped. Let's say he bought a home back in 2011 for $475K. Let's also say he's been working from home, his job is located in another city (my situation), but they are now insisting that you've gotta come into the office four days a week. Ok, great, he goes to sell and he gets $745K for his home, pays off the $475K (he wouldn't have hit the principal at this point) and takes the $270K and buys into this high interest rate market. But again, he's got $270K to lower that mortgage.
To make things even better, if I were in that situation, I'd get an adjustable rate mortgage, which have lower interest rates and would refinance with rates come down. Sure, ideally you'd prefer to just stay where you are, but in this situation, you're far from trapped if you have to move.
Equity?!? How long that’s the conversation about
@@geeked-outbasketball765 Wow! I think you are the first nice comment I have ever seen on youtube. Thank you!
We built 16 years ago a very nice 3000 sq ft home for a little over $100 a sq ft. The same house now would cost around $225 a sq ft and my interest rate is locked in 2.5% vs the current 7%. Long story short I and I would gather many others don’t feel “trapped” in our homes just because I don’t want to pay the housing machine and banks hundred’s of thousands of dollars more in interest payments and price gouging falsely marked up material and building cost.
You got lucky, your timing was right. Others can't all be as lucky.
You don’t speak for those that want bigger homes because their family is getting bigger.
Exactly. Media spinning a narrative again. Too bad for them, many people are catching up and being smart nowadays
Can’t buy my first home as a 24year old everything is overpriced and the interest is higher. On top of that there’s barely any houses up for sale near me.
@@gimne More adult children are living with their parents now
Trapped? We are grateful that we have properties, the ones really hurting are new homebuyers
Lmao I know right. Way to turn a positive into a negative CNBC.
I'm not complaining with my 2.562%. I'll have it paid off sooner than later.
@@kidwichitamine is 3.75 .i am keeping mine... imo you snooze you lose
i dont think anyone is buying
@nappytime25 less demand wayyy less inventories in the market. There is still bidding wars in desirable areas smfh
Trapped? I don't think so. I'm enjoying my low, low 2.25% mortgage rate in my mountain home located in the Rockies. In fact, that 2.25% mortgage rate is very liberating.
Just pay the damn thing off, it's even more liberating. I can testify.
Its always funny when someone intentionally misinterprets the point. Unfortunately- it comes across as stupid and sad as a TH-cam comment.
I feel a bit trapped. We love our home, but we want to purchase the "forever home". I can't help, but think how much cheaper the monthly payment would have been had we purchased sooner. I wasn't expecting mortgage rates to increase that fast.
Mine is 2.00%. With 12.8 left. I’ve been buying 4% CDs with my extra payment. Will pay down my mortgage when the roll over rate drops. (I know it’s not the Ramsey method).
Exactly, I’m at 2.25% here in Southern California. My mortgage payment for a 3200 sq/ft home is now the same as the 700 sq/ft apt we moved out of 5 years ago. I cannot believe people have to shell out $2500 - $3000 to rent a 2 bedroom apartment these days.
I don't feel trapped. I got a good price and fantastic rate on a starter home that helped me to get out of an apartment. When I upgrade, I plan to keep it for a rental.
Now that’s what I’m talking about! My wife and I bought our forever home 5 years ago, and 2 years ago we refinanced it down to 2.45, and bought 2 rentals and have those at 3.25! Smart, have someone else build your equity for you! That’s how wealth is created!
@@dmkfactor1721 the wannabe landlords think they're better than anyone else. that's also how you destroy a whole generation. rents and home prices are coming down very soon. prepare if you bought a overpriced property.
@@gabryy12 🤣🤣🤣🤣 go read Morgan Stanley’s report Zero!
There should be a law that seller credits must be disclosed with the final sale price. A house that sold for $400k but had $20k in seller credits should have to reported as being sold for $380k. It artificially inflates comparable homes.
Yes!
Credits ARE posted on the MLS which will be listed in the comparables that a good agent will give you to decide on the bid
@@yume816 I understand that but that isn't what I said.
this whole real estate agent business is a scam.
If you’re the builder and trying to sell the community, you want to keep those prices as high as you can until you unload all those homes..
Feel trapped? You kidding me? No… we feel lucky and happy where we are. We’re at a ridiculously low 2.25%. There’s no trapped with that. The trap, is needing a home, and having to search with 7%+ in your future.
Not if you pay cash
We bought our starter home in 2020 @ 3%. Because the market was crazy, we bid on over a dozen houses and overpaid for the one we got. The house has most of the core things we wanted but, if the interest rates weren't as crazy as they are now, we would likely be looking for a new house early next year. Instead, we're waiting it out another 2 years to see how the market shakes out.
Prices will never go down. Huge demand + little supply = high prices
You fail to realize we have under built america
@@thedude5040lol. They’re heading down monthly.
@@billbigshlong382 maybe if you live in a state that allows the homeless to poop in your front yard, but I assure you prices are not going down throught the country
We refinanced at that price. We pay a little over 1k for the mortgage, why tf would we move into a higher priced terrible interest rate new home
Being trapped never felt so good
I dont feel trapped at all. Rather relieved and counting all my blessings.
I have a 1.99% mortgage 15 years refinanced in 2021 originlly bought in 2018 @ 3.875% 30 years. Now with $130k equity in a little over 5 years. The original price was around $200k (starter home) Im just incredibly lucky as I timed the refinanced just right. It helps when you listen to the wife. 😅
- damn I didn’t know they dropped that low ! 😮
Imagine being "trapped" in a tornado shelter while the tornado is right above you.
Imagine being trapped in a 2.5% mortgage that will be paid off in 10 years. In a house you love and have tons of equity. Boy it's a living hell.
@@bigmike9433- i guess we will be suffering in silence 😆
“Trapped” is not the word. It’s more like they are not motivated to sell. They will sell if something changes in the market (greater inventory, lower rates) or in their lives (marriage, divorce, family death, financial pressure).
- this right here! I could sell tomorrow, but there’s no incentive.
Yep, that's us. We have a 2.875% mortgage rate currently and moving to a new/better house, even at the same mortgage loan level, would increase the price about $700 just due to higher interests. Again that's for the SAME amount of total debt on the mortgage if we moved.
Oh poor you. Cry me a river
you sold late, and at this point are impulse buying paying 700 dollars higher for your decision.
Yep. I was in a 30 year mortgage but about 5 years in at around 4%. When those rates dropped in 2021, I was looking to sell and buy because I wanted a one story house instead of my 2. But the inventory was ridiculous. So, I said screw it and refinanced with a 2.65 and 20 years. Best decision ever. Didn't take out a dime. Now, I have a 4 bd rm, 3 bathroom, 2 car garage in a gated community in a south Florida neighborhood with excellent schools and no crime for 1,670 per month. I am not getting out of this PERIOD! I One would be nuts to take on a 6-7 percent mortgage now after being in a 2.xx percent.
Good luck with your homeowners insurance doubling every year!! Also when your house gets it's new appraisal for property taxes I'm sure you will feel so grateful.
@@kjay5056 you type that like you are just hoping all these things happen to my household. Nevertheless, for now, we are good to go. My wife and I both easily make well over six figures. With that in mind, I hope we will still be fine and still are grateful in comparison to the BS others are having to put up with around us. But yep... Keep hoping and wishing everyone falls down in the same sinking boat all because a few are hanging on in a life boat. What we are anticipate is not inevitable. So, until that bridge gets here, we march on and still remain positive and for now, comfortable.
%2.5 you ain’t trapped. You’re living like a king!!
not trapped rather blessed
The effects of the downturn are beginning to sink in. People are being impacted by the long-term decline in property prices and the housing market. I recently sold my house in the Sacramento area, and I want to invest my lump-sum profit in the stock market before prices start to rise again. Is now the right moment to buy, or not?
Don't depend your market assessments and decisions on hearsay and rumors; I did it in 2020 and ended up with worthless market holdings. Before I started noticing any notable improvements in my portfolio, and I had to completely rebuild it. I've been using the same advisor ever then, and in just two years I've scaled up to $876k. Depending on where you look, a bullish or down market might both produce good profits.
@@carssimplified2195 Thats a good one. I know a lot of folks that made fortunes from the Dotcom crash as well as the 08’ crash and I’ve been looking into similar opportunities in this present market. Could this coach that guides you help?
@@Justinmeyer1000 My Financial adviser is ‘’Christine Jane Mclean’’ she’s highly qualified and experienced in the financial market. She has extensive knowledge of portfolio diversity and is considered an expert in the field. I recommend researching her credentials further. She has many years of experience and is a valuable resource for anyone looking to navigate the financial market
@@carssimplified2195 Thank you for this tip. It was easy to find your coach. Did my due diligence on her before scheduling a phone call with her. She seems proficient considering her resume.
Hard to make broad statements about real estate now. Our metro area on the east coast has a huge supply shortage style. No measurable decline in property houses here.
My mortgage is $1200 a month on a decent starter house. I’m just gonna ride this out for a few years and see what happens
Roughly £120k in my portfolio are in tech/TSLA stocks, can I get an advice on any other stocks that I can acquire to diversify my reserve across multiple markets while creating a comprehensive portfolio allocation that balances my concerns of risk aversion and returns that meet yearly inflation.
You need to hire a financial advisor to help you diversify your portfolio by including Mutual Funds, Etf's, the 11 GICS groups, inflation-indexed bonds, and stocks of companies with reliable cash flows rather than growth stocks, where prices were based on future prospective earnings.
@@chloeanderson543 That's correct. At first, I wasn't too pleased with my gains compared to my previous performances, I was doing so poorly, I thought I needed to diversify into better assets, so I got in touch with an investment-advisor. That same year, I pulled a net gain of £550k, which is about 10 times more than I average on.
@@kalfmanbrown5953 My portfolio has been in the gutter for the entire year, so I started researching new ways to profit in the market, but everything I tried just seemed to miss the mark. Please let us know the name of your financial advisor
@@darrenphilip247 Having a counselor is essential for portfolio diversification. My advisor is "Trade with Ethan Grayson" who is easily searchable and has extensive knowledge of the financial markets.
@@kalfmanbrown5953 Thanks for this tip. His handle and website popped up on the first page immediately I searched Ethan’s name, I read through his resume and it seems pretty tight. So, I dropped a message & hopefully he replies soon.
Were not trapped, we’re just not incentivized to sell and move to another house.
"Trapped??????" Lmao...YES PLEASE I need help getting rid of my 2.50% rate........
Some countries allow "mortgage porting" which would allow you to transfer a loan to another home. That is not common in the US. Not sure about feeling trapped, but the reality is that I have a 3% rate. My mortgage is $2600 a month. If I were to buy another home and keep the loan amount the same, I'd be paying $3400 a month. If I could transfer my loan, I would keep the same payment and use the cash I get from the equity to cover the delta.
Instead, I would need to swallow $900 a month for a similarly priced home, or buy a much cheaper home to keep the same payment in order to move.
Interesting perspective, as I am locked in 2.25 courtesy of disabled veterans refi. I also purchased prior to covid. My main concern is the coming rental frenzy as a option. As well as, whole cash buyers. This will surely inflate prices. Many fortunate homes will mortgage free by 2025. That's when the straw will break the camels back.
My rent went up 30 percent in two years. Same across my zip code. My pay up 3 percent. I have to look seriously at leaving the USA for another country to live in. Neither party cares about the middle class. Go ahead attack me and say don’t let the door hit you on the way out lol
I totally agree with you. I love America, but I may have to retire out of the US or at least out of California. Although I own a house, everything (utilities, petrol, grocery, etc.) just keeps going up. I am doing my own gardening, because I can't afford a gardener anymore. I am scared to turn on my AC, because the electric bill is soaring, I am taking public transportation because petrol and insurance costs are high... it's a struggle living a middle class lifestyle.
Have you tried a high paying profession? You could do a 12 week coding camp and earn $100k/yr quickly.
And this is the reason why you don't rent in the first place. There are several programs that give out grants to own, or 01% interest rates
@@igotanimac1 Yes, we started out as a young couple with an FHA loan and zero money down.
@@TrendyStone I make lots of money and spend lots of money lol. I like being able to move wherever I like. I live in a very affluent place so my kids have good schools. When they graduate will move to a cheaper locale
Trapped?? Gtfohhhhh what a joke!!! These banks are upset cause nobody is throwing money there way to help improve / increase there bonuses!!
Yes, trapped because why would anybody sell when they have a 2.5% interest rate and buy into a 6% interest rate losing considerable buying power? Also you need to learn the difference between their and there, basic english. Lol
I wouldnt say "trapped". More like sitting comfortably with a very low mortgage payment, why would they sell for ?
He means trapped because people that have low interest rates can't sell or their payments would spike hundreds or even thousands more for the same house due to interest.
How are they trapped? They can payoff their homes sooner. There is no supply because corporations are buying single family homes.
All the comments are disconcerting frankly. It sounds like a bunch of people went and bought homes they didn’t really want or need just because interest was so low. Everyone is trying to become a landlord and it’s all going to come down like a house of cards if people start losing their jobs.
Rates would have to come down to say 4% before I’d think about selling and buying again. We bought our home at a shrewd price which eased the pain of a 5.5% interest rate. With our largely labor intensive improvements we’ve upped our value considerably, but I’m not up for paying 6% plus in interest. If need be we’ll enjoy our newly made castle for years to come.
Same for me.....
I wouldn't say I am trapped. I would say that I am now a future landlord. And when prices and rates adjust I will buy another home and rent my current home to help offset the cost of a higher mortgage on a new loan. Me keeping my house as rental property instead of putting it on the market for realtors and banks to profit from is a issue to investors more than anyone.
EXACTLY....I was literally just thinking the same thing...
“Trapped” - oh the horror, I’m suffering with this financial stability. Someone save me
You missed the point. If people can’t or won’t give up their 2.5% loan they won’t upgrade (buy bigger house or build)…which impacts new construction (and free movement), thus total inventory, thus drives up rent payments. High rates impact everyone.
Exactly!! These morons keep saying “upgrade”… “upgrade”… who says you need to upgrade if you made a solid purchase?
Well if you look at consumer debt right now it's skyrocketing. Credit cards alone are more than 1 *trillion* Not everyone is "stable" like you
@@mg-by7uuNot my problem
@@Bonafide188 This entire discussion confuses macro economics with micro economics. You never took Econ 101.
Just sad that the country is turning even more into the "haves" (people who own a home at low interest rates and constantly gaining equity as home values rise) and the "have nots" (people who can not afford homes anymore because prices are going up way faster than wages). Something has got to give otherwise there will be a revolution or something eventually. Homelessness is no longer just for the lazy/drug addicts but for working class people.
I saved up for my house and bought it with cash. Took 15 years of saving and renting. Imagine that, you save for something...then buy it. If you can't afford to rent, then you can't afford to own a house.
When you add in all the costs of owning a home/house (insurance, maintenance, repairs, roof, furnace, mortgage, taxes...), the economics will almost always favor renting over buying. However, people want a "home" and to know that they can choose to live there without the threat of having to move and for life stability, but, you should first rent until you save the coin to comfortably buy. @stevenk195 is spot on.
I don't think I've ever seen two stupider posts on home ownership vs renting in my life. First guy says "if you can't afford to rent, you can't afford to own" (which is probably true, but it doesn't really show much sympathy for people who can't afford to rent--where are they supposed to live)? Second guy says "the economics will almost always favor renting over buying" but seems to forget that the REAL value in owning a home is the fact that your mortgage rate never goes up no matter how long you live there. Try renting a place for 30 years and see how much money you end up shelling out.
@cozyslor not even close bc if they equal the same which they typically do..I'm getting at least my money back when I go to sell due to appreciation..when you leave your rental all you get is a thank you from the landlord
@@User.9.459 This analysis makes zero sense. First, there's no guarantee your property will appreciate, and doubtful inflation adjusted. If Rent = Mortgage then your home better appreciate equal to or greater than the expected return on your down payment if it were invested. Now add in the money it costs to maintain a home, insure a home, etc...Here's a question for you; If I have a $500K 30 year fixed mortgage @3%, and I have $500K of cash, would you advise me to pay off my mortgage?
Less people are choosing to get married, more are deciding to divorce or live separately. So there will continue to be a demand for homes
We are not "Trapped" we are perfectly happy with the houses and rates we have .. you are the only one who's crying!
There crying cause there bonuses won’t be as big.
I live in LA. Got a home for 3.125% interest rate and paying just a little bit above your average rent. 100k+ in equity in 2 years. I'm not trapped, I'm set.
housing is about 30 % higher than it should be. maybe even more. let’s be honest… everyone just been buying homes to live for free in the long run. thinking this home will get them another one.
pretty much low interest rates for the past 15 years. your 3% mortgage won’t matter if your property drops 20%
😂😂 exactly, I'm seeing a bunch of newly purchased homes going up for sale in my area. The appraisal values are estimated to drop. Which is likely to happen. Got an email from a homebuilder recently, who has inventory, showing prices have significantly dropped. Pricing was too high and now that speed bump hit and was left holding the bag. Can't ride in a boat upside down for too long. If you got a low low price and good interest rate, hats off too ya. But an overpriced one....ehhhhhh.
Yes, please free me from this burdensome trap of low interest payment. All I really want was to be free to pay more of my money in interest and enrich the banks. Sucks to be me.
"Trapped" is another way of saying that many are just out of the selling market. Many buyers out there are trapped because the supply is so low and the price of entry is too high. It's a stalemate until something breaks.
Exactly. Everyone with a property at a rate under 3% feels fortunate and was smart/fortunate to take adavantage of those rates. The folks who are trapped/screwed are the buyers. High rates and low supply = bad environment to be buying.
What makes him think people assume that houses would be selling of at 7% interest rates? The only reason housing sold off in 07 was because from 04 on most mortgages where adjustanble rate mortgaes and people were forced to sell. This time most got the 30year plus a bunch of cash out to beef consumer spending. The real fear should be when people run out of all that refi money and have to soley depend on there wges to beef up the economy. That will be scary beacuse for the past 20 year or so people have used refi money to spend like crazy.
Just wait and see what happens when they drop rates again
@@DanielRicany Yes. demand will go crazy, buying and selling. But first their will be some pain. That will be the catlst of the rates dropping. they dont just drop rates for the fun of it. So there will be a crash while they drop the rates followed by the mother of squeezes in stocks and house prices.
@@DanielRicany Rates aren't coming down significantly anytime soon unless something breaks.
The market is getting back to normal. people seem to ignore that before 2008, when we had mortgage rates near where we are now, people would stay in their homes longer than they do today. Since 2008 with historic low rates, it was easy to jump from home to home, and home builders really pulled back on new construction. I wouldn't be surprised if we see new home construction steadily increase and maybe get back to pre-2008 numbers. Also, we might see the reintroduction of starter homes because low-interest rates were causing starter homes to disappear as you could get a lot of house for fairly cheap prices. now with normal interest rates, the amount of house you can get or afford is going to shrink.
Being trapped sounds awesome! Any trapped people want me to take over their mortgage?
How's that a trap? It's not if you have no plans of selling in the near future.
Trapped my ass. I'm perfectly happy with my 2.65% mortgage thank you very much! I ain't going nowhere!
The prices need to drop at least 40 or 50% before I would even think about buying.
Looks like you won’t ever be buying lol
Keep renting is no fun either.
I dont mind renting. In my area most houses seem like a massive pyramid scheme. You get an over priced home with a high interest rate. Plus on top of it you pay massive property taxes that have doubled in the past 5 years. Dont forget that huge HOA fee each month.
Once interest rates drop, housing prices will skyrocket.
Broker valuation will take apple to apple comparison.. even Zillow had dropped inventories in 2022 due to this trapping concerns. As a free agent you can be more flexible in renting..
Trapped?? The people who were smart enough to get those homes via their main mortgage or a re-finance then "planned" on being there a long time and not selling.
I doubt many of them "planned" it.
Everyone has a plan until they get punched in the face
- Mike Tyson
Lower interest rate, inflated prices = higher property taxes and insurances.
I own three properties in Hawaii outright and never had a mortgage. Life off the grid.
You're assuming everyone actually wants to move. They don't. Most folks are content right where they are.
I refied in 2019/2020 from 4.7 to 3.1 and put my house on 15 years from a 30. Bought my house in 2016 for $148k and now it’s apprised and all other homes in my neighborhood which some have sold in the past couple of years for over $300k. I’m not trapped at all just smart enough to know I cannot get or afford anything better than what I have, and why lose my $200k in equity and “pay up” for something else at 7.2 apr. I have no reason and it would not be smart to do so as things are currently
It’s not cost reductions, it’s the price of materials falling and they are still gouging customers on the final price.
ITS DISGUSTING!!!
Just move on if you don't like prices. No one is stopping you. What an idiot
Guess prices will have to drop then. No way mortgage rates are coming down much anytime soon.
With a low inventory that’ll take a decade to be realized!
It'll come. All these layoffs will lead to many foreclosures
@@kidwichita what layoffs? Unemployment is below 4%! This isn’t 2004 when IF you got laud off you had no hope. Now you can turn on an app and join the gig economy!
@@dmkfactor1721 are you serious? What layoffs?
@@kidwichita didn’t 339,000 new jobs open last month? Can’t people go work instacart and drive for uber now? Your stuck in 2004 bud!
Supply is that short and becoming larger. Builders are trying their best to keep comps high.
Same goes for folks that bought 0% interest cars and trucks for 84 months right when the pandemic hit. Those folks are going to drive those cars and trucks into the ground because of the rate! It's not being trapped, it's just hedging yourself against inflation for a duration.
@stuckcamping
When they loose the house they can sleep in their 75,000 vehicle until the repo truck comes for it.
I still will never get used to seeing 84 and 96 month car loans. So much depreciation and sales tax.
I beg to differ with him...the people "trapped" in homes are those with 6-7% loans...not those with 2-3% loans.
One is only trapped if they bought something they never liked, now are upside down, or have a student loan about to come and can’t afford both. I don’t think there’s a ton of that. Trapped is the renter waiting for better inventory hitting the market. Why is anyone talking about how renters are trapped.
Considering the current 7% to 8% rates. And over priced low quality homes being built and sold. We are happily trapped in our home. We can upgrade a few things we always knew we needed. Because paying more for less is not an option.
Not feeling Trapped, feeling good about our low 2.9% interest rate which allowed us a very nice home.
I got my home at a 4.5 rate. My last apartment was going up on the rent, im good with that
What about all the houses that are being used as airbnbs? They account for a lot of homes off the market.
Columbus Ohio is too expensive! A safe and clean 1 bedroom apartment is over $1,000+/Month. Most people cannot afford this on the crappy wages! Wages would have to be $25/Hour and up for any job to keep up with criminal rental gouging and inflation! PAY gouged pricing to Play ( live ) is a crime system!
There is no shortage of homes. Demand is dead. Nobody is buying. Builders have added record numbers of homes to the market. Supply is climbing across the country. Prices will continue to decline for the better part of a decade.
Depends on what part of the country you’re in
The Federal Reserve has created damage to single family homes by distortion of interest rates, keeping interest rates at 2% for years to long. This causes bad behavior just like we saw people bidding a house prices to ridiculous prices. The federal reserve still hasn’t corrected this huge disconnect with interest rates and housing. The long-term fixed rate mortgage rate should be 9.0% to 10.0%.
You said it! Interest rate was too low for too long. The Feds had good intentions, but were very short-sighted in their thinking . Almost everyone locked in these ridiculously low rates, and now no one would sell, thereby causing extremely low inventory, so prices are not budging. Just terrible. Yep, I support 10% Interest rate.
That won’t fix the supply problem! It’ll only tighten the market even more! Glad we refinanced all our properties a couple years ago!
History of the federal reserve tells us, that higher interest rates, brings down inflation, and breaks the back of housing
No, the politicians created strict lending regulations after 2008, and since then, building never was able to keep up with demand. Let’s stop pointing finger at interest rates, corporate rentals, inflation…. and let’s address the real issue, which is regulations. For decades, liberals were wanting to more like socialist European nations, and with each vote, they get close and closer to Europe, but Europe are very expensive renters nations. People that vote democrat, are people that want more regulations, and they have to know it’s ultimately going to cost a lot more. So, if you vote democrat, don’t even complain, and embrace the high prices, because this was a conscience choice.
@@jesse_- AMEN! 💯
Those who feel trapped did not make a wise decision about the home they purchased, or were flippers thinking the financial market would never change. Realtors want people to keep moving around because they make bank on every transaction & keep people behind the 8 ball making payments forever without ever owning their home outright. I's really sad people don't understand how the whole thing works.
I don't know of a single prospective buyer that doesn't dream of being 'trapped' in 2.5% 30 yr mortgage; at 2020 prices to boot. The winners. Now, it's really tough. There are no easy answers for missing out on that opportunity.
Actually no, homeowners with 2.5/3% rates are allowing new owners to assume the old load, dont ask me, ask a mortgage broker. The trap is the soaring home pricings, which will always be an issue. Basic supply and demand.
That’s the absolute problem (or opportunity) which is that it costs $1000 more per month to own a home than to rent a home. What he left out is that these are basic entry level homes for people making under $100-200k/yr. It’s cheaper to rent.
Maybe in NYC, but not the case elsewhere. Real estate is very local, try to remember that
It is the same for my brother in Utah and my sister in Oregon. Maybe not exactly $1000 but it is hard to justify buying
Renting can be as much as buying in certain markets but not everyone can qualify for a mortgage. However they maybe renting g at the same amount they would be paying for the mortgage that they don't qualify for. Happens all the time. So they are forever renters. They are the ones that are trapped.
trapped is a terrible term......people are not trapped they just are not incentivized to upgrade homes....mine...will pay my 2.125% loan in the next year...then be debt free....
Id say air Bnb is hurting supply. I’ve been to about 50 home units that are rented rooms with electric locks on each door rented through air Bnb. Multiple that by 5 % by county and the numbers are astronomical.
Go look at air Bnb see how many homes are rented rooms strictly for profit. It’s sick.
You get with the right builder. You could still get. 4% mortgage.
Mine is 3 and a quarter. Got it done early 2021 before everything went to hell on inventory and interest rates. I have 280k in positive equity. This news report is for people like the guy I work across who hates my guts. He's gen z, morbidly overweight, and underperforms and has no hope for the future, and he hates my guts because he thinks I think "I"m something Im not" This report is dished out in true ESG/DEI bs fashion, for weak people to think they have ammo or even could hold a candle against the productive among us. The same people who get mad about fat shaming, and people not respecting their pronouns, and being gullible to eat this up. I guarantee you nobody in my position feels "trapped"....but meanwhile, have fun projecting while the rest of us keep it moving.
Duplexes are worth double than a single story home in Toronto so an upstairs addition for 400k would dramatically raise the value beyond the 400k invested
They are only "trapped" if they intend to buy a new home. Therefore this has no net effect relative to supply and demand, very misleading.
Yeah, trapped in a 3br 2bth with 2 car garage on a decent lot we paid $128k 3.28% rate. I'll stay trapped for many years.
@Dave-zl2ky
For that price. It tells me you’re not in a desirable neighborhood. The ghetto.
Not trapped. My 3.75% rate is helping me avoid horrible inflation and the builders and banks that are taking advantage of it and price gouging their customers.
You could always downgrade and pay cash/smaller amount of debt…
We ain't selling ,
We ain’t buying you live in Portland, the cesspool
People can't sell because they have such low mortgages so moving up or downsizing is a non-starter.. It means most of the housing market is reliant on new builds right now which is problematic in a lot of areas because of the amount of red tape and laws.
Im at 2.25% and love it!
you are not trapped by the low rate you just need the house price to fall to get the pmt back down, but god forbid we cannot allow that
Can you tell, till how long they are trapped? Because, as I see if the rates go down the home prices will further go up. One way or the other these rates will bite everyone. Some today and some tomorrow. It’s just a matter of time.
The country is short over 5m houses. Once that demand is met, then prices will go down. This all started the 2008!housing crash, when the politicians tightened lending regulations. I mean, when you regulate something like this, it is definitely going to have a major impact on prices. Essentially, if you vote democrat, this is what you voted for, so do not whine about high prices.
What an Asinine statement and thought process!!! You should feel fortunate to have a two percent mortgage in this high interest environment. No need to over pay for a house when you can wait until this foolishness is over.
Why am I trapped with 2.75% ? I am waiting to buy more when everything drops .
You’re trapped because you bought in the ghetto
People are missing the point. They buyers who feel trapped are the ones who need to either reduce their living situation or grow it according to their family needs. For those that NEED change, theyre in the same shoes as fthb. Low inventory and hight rates. So they have to stay with what they have. Thus further feeding low inventory.
Try 2.375%. for 15 yrs. Why should I pay the fees for people with bad credit?
You date the interest rate, you marry the asset.
Our first loan in 1987 was 14% adjustable. We suffered for awhile and finally were able to remortgage a few times in 30 years to keep bringing it down. We moved 7 years ago. We were lucky to get a home (in a different state) that was a fair price. We did refinance after 5 years and now have a 2.99% loan. Considering how much we have paid in interest on our first house it's nice to finally catch a break. And yes we will die in this house and our children will split the money.
If im “trapped” with my 3% mortgage loan, then I don’t want to be rescued or freed. 😆
Not trapped. You can go buy a new home and put the current one on rent. You can offset the high interest cost on new home with any net income from rental home with low interest rate. It’s pretty simple if ur in the position to do it. Also u can refinance the new home year or two from now when the rates come down little bit.
How are they trapped? They have at least a 50% equity and the ability to refinance later after a purchase. The only issue is finding the perfect home...
It's kinda dumb at this point to say that it's hurting supply if new housing is not being built to actually meet demand. Right now it just seems to be re-arranging the deck chairs on the titanic as it's sinking (in this case, the real estate bubble popping).
Americans traditionally carry too much house, a smaller property with much lower maintenance cost is the right choice for most people, this is a good trend and hopefully continues.
I got my house for 400k @ 2.25% why would I sell??!!? Makes zero sense. My home equity is great. People learned from last housing market crash.
Yeah I am trapped. Trapped with a low payment and high rental income oh noooo Im screwed
If home mortgages traded like bonds I’d be open to moving again. I have a 2.49% 30yr fixed rate mortgage and owe $320k (home is worth $600ish). The bank sold my loan to the Fed, and if they would take a steep cash discount to settle the note I’d do that immediately.
Technically, the value of the mortgage should be marked down significantly given that current mortgage rates are 3x higher.
2.25% on 15 years mortgage with Almost %50 equity, not selling and not moving. If i need more rooms i will build more rooms, 7% interest rate on house for 30 years will most likely be a financial suicide.
I bought my house is 2021 at 3 %
Not feeling trapped feeling blessed