Affordable or not?
It's been couched as a "bad news, good news" sort of deal: The drop in home prices has devastated some who already own homes, but it makes homeownership affordable to more people who don't yet have a foot in the door.
Now comes the Center for Housing Policy, which is warning everyone not to call the affordable-housing problem solved just yet.
If you've got a 10 percent down payment, you'd need to make about $70,000 to get the median-priced home in the Baltimore metro area without spending more than 28 percent of your income on the mortgage, property taxes and insurance. We're talking about a $235,000 place.
Though $70,000 happens to be the median household income in the metro area, there's a lot of two-income couples accounting for that figure. Trying to buy on one salary can be tricky, especially if you're a police officer ($52,000) or a licensed practical nurse ($41,000) or in any of the many professions that pay less.
The center's newest Paycheck to Paycheck report ranks metro areas by price (we're tied for 29th most expensive out of 208), by change in income needed to buy (we're middle of the pack) and by rental costs (we're 27th most expensive out of 210).
Today's story has more, including the experience of a woman looking for a $200,000 home and finding mostly foreclosures. And check out this map of the most and least expensive places.
What's your experience? Is the housing market affordable to you and the people you know?
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Comments
I own my house.But if i was looking now for one i would be going to some of the auctions.
They had one last week by Fayyette and Linwood where they auctioned off a house for $15,000.
The neighborhood was so-so.And the house wasnt perfect. But it was more than livable and was 18 feet wide[as opposed to the usual12-14 ft rowhouse in East Baltimore].
There are tons of vacant houses that could be sold cheaply in order for people to be able to buy a house.
The only two problems are
1-The City is sitting on many of them and doesnt appear to want to sell any of them[like the Dollar House program ]
And
2- They are in areas that have a lot of crime.
Crime really does increase the price of housing in Baltimore because of the simple law of supply and demand.
Yes, there is a huge supply of housing.But there isnt a large supply of housing in safe areas.
If the "rough" neighborhoods were made safer than real estate agents might make less per house.But they could make it up in volumn.And guys like me who fix up houses[i do interior demolition and basement excavation] could work on the houses.
Near the end of the boom it was hard to find work because people had paid so much for their houses that they couldnt afford to have more work done on them
Posted by: Pete from Highlandtown | March 24, 2010 10:30 AM
I would like to add that i am glad that homes are more affordable than they were 2 years ago.
I own a home and i dont want it to lose value.But i also want other people like myself to be able to buy a house.
I bought my house[in 2003] back when a construction laborer like myself could afford to buy a house for $45,000.
I think that is what makes Baltimore so great.That a guy like me can own his own house and be neighbors with people who have a diverse range of incomes.
Posted by: Pete from Highlandtown | March 24, 2010 10:36 AM
Again - Prices for homes in Maryland are nowhere near priced correctly (let alone affordable) for first time buyers. The people still in the Ponzi scheme is another story. If you can get three not very smart people with different incomes - trading up can still take place. When homeowners finally admit that they are not Donald Trump(who himself has gone bankrupt two or three times) and people who can afford some of the outlandish prices stop buying - home prices will drop very fast. People do not understand the value of things...they don't understand that b/c they have a certain amount of money that they have to spend it......a home is a purchase (just like a gallon of milk) if they started asking $10.00 for a gallon of milk - would you buy it?
Posted by: Jon Babble | March 24, 2010 12:06 PM
Question for Pete - can you excavate a basement when the house sits on a slab? Even if it is a split level so only 1/2 the house would have to be excavated? Would it be more cost effective to move if I needed the basement space? I'd prefer not to move and start another mortgage.
Posted by: smirkman | March 24, 2010 2:06 PM
Reply to Smirkman
Smirkman
It depends on the house.I excavate basements in rowhouses where there are no footers[ in other words the brick walls sit on dirt] .
So i have to put a concrete foundation in [about 3 feet at a time].
I always avoid end units because of support issues.So i defintly advoid digging out the basements of single family detached houses.
That doesnt mean that it cant be done.You just really need to be careful.
In Baltimore City it is the law that you are required to have a structual engineer's plan before you get a permit.
Anyone that tells you that you dont need a permit is probably "bad news".
I would defintly consult a structual engineer.
And if you have any more questions about it that i may be helpful with Jamie is more than welcome to give you my e-mail to you so you can ask me directly.
It doesnt sound like i can help you workwise.But i may be able to give you some advice if i knew more details[ what kind of house ect].
Either way , be careful.And dont be afraid to ask any contractor to show you what he is doing.
No construction contractor wants a customer standing over his/her shoulder ALL day long.
But no honest contractor has a problem answering questions or showing you what progress that they have made or what they are doing to ensure the safety of your home. Thats part of our job.
Good Luck!
Posted by: Pete from Highlandtown | March 24, 2010 8:25 PM