Why Do So Many On INGO Hate HOA's?

[Ingomike]

100' on the south, 120' to the north 1 across the street, 1 cati corner (across the street from the south neighbor) my back yard butts up to the people on the block behind me.
Houses on my side of town are +- 100 ' apart

Nice!

 

[Creedmoor]

Did you read the news article in the post he made shortly above my post? I think it'll be readily apparent at that point.

Sorry, I didn't read it.

 

[KLB]

Yes but purchase prices have now also increased. So yes they got 6% more than when they purchased but they are going to have to pay that same 6% more on anything they buy. While our house has increased ~50% in the last 5 years we can't go get a bigger better house with that increase because that's more expensive too. The only thing we're seeing is increased property taxes.

 

[jkaetz]

This fails to account for the increase in downpayment buying power to move up that I laid out in the text. They started with a 3% downpayment and after five years had at least a 10%, if not 20% downpayment on their next house.

I'm not sure how that math works so let's see.
House Purchase Price 100k (easy numbers) 3% DP
House sells for 106k
We'll assume a 7% interest rate over 30 years which means they'll have paid ~$5400 on the principal in 5 years.
Add their initial down payment and appreciation (3k + 6k) subtract 6% closing costs ($6360) and you get ~8k for a new down payment. To make a 10% down payment they now need a purchase price of 80k. To make a 20% down payment they need a 40k house. I sometimes do bad math, but I'm don't think the math supports what you're advocating.

Yes they have more down payment but house prices have also risen and there are a lot of costs associated with selling and this is ignoring all the opportunity costs. You could even say they are great negotiators and got their closing costs down to 3% of the sales price and things only get marginally better. They could then go buy another 100k house and have a 10% down payment but that will likely be a downgrade in the quality of the house to maintain the 100k price point. Appreciation would be great if it was only your house that was appreciating but when its all the houses its a wash.

 

[jamil]

You left out midnight golf/DST - or is it because you're pro-DST that you'll let that one slide?

I’m pro UTC. I’ll settle for DST. But if I couldn’t have that year round, I’d rather just stop flipping clocks back and forth.

Midnight golf? Like at Putt-putt? That’s the only golf I play, but my bedtime is around 11pm on most work nights.

 

[firecadet613]

I'm not sure how that math works so let's see.
House Purchase Price 100k (easy numbers) 3% DP
House sells for 106k
We'll assume a 7% interest rate over 30 years which means they'll have paid ~$5400 on the principal in 5 years.
Add their initial down payment and appreciation (3k + 6k) subtract 6% closing costs ($6360) and you get ~8k for a new down payment. To make a 10% down payment they now need a purchase price of 80k. To make a 20% down payment they need a 40k house. I sometimes do bad math, but I'm don't think the math supports what you're advocating.

Yes they have more down payment but house prices have also risen and there are a lot of costs associated with selling and this is ignoring all the opportunity costs. You could even say they are great negotiators and got their closing costs down to 3% of the sales price and things only get marginally better. They could then go buy another 100k house and have a 10% down payment but that will likely be a downgrade in the quality of the house to maintain the 100k price point. Appreciation would be great if it was only your house that was appreciating but when its all the houses its a wash.

The real magic is not moving every five years. When you do that, all you do with a 30yr mortgage (as your example showed above) is pay interest, barely any principal.

If you have a 30yr, you really need to send more than your "required" payment, even just $100/mo to help pay down the principal quicker. That or try and refi into a 15yr mortgage.

The 7% rate is absolutely killer and will hurt many in the middle class, if you can't pay extra or refi your way out of it, you're just throwing tons of money at interest.

The magic happens when you stay in the same house 10, 15, or 20 years - regardless of your mortgage term or interest rate. That's when you really start to pay down the principal and can turn the tide.

Midnight golf? Like at Putt-putt? That’s the only golf I play, but my bedtime is around 11pm on most work nights.

No, Top Golf. That's my kind of golf. Great food and drinks brought right to you (no need to try and find the "beverage cart" out on the course). They even have heat in the winter and restrooms always just a short walk away!

 

[jamil]

Those people are free-riders. they want a pool available, but rather than just have one built for themselves, at their own expense, they want everyone to pay for it

So yer saying, it’s basically pool welfare.

 

[jkaetz]

The real magic is not moving every five years. When you do that, all you do with a 30yr mortgage (as your example showed above) is pay interest, barely any principal.

If you have a 30yr, you really need to send more than your "required" payment, even just $100/mo to help pay down the principal quicker. That or try and refi into a 15yr mortgage.

The 7% rate is absolutely killer and will hurt many in the middle class, if you can't pay extra or refi your way out of it, you're just throwing tons of money at interest.

The magic happens when you stay in the same house 10, 15, or 20 years - regardless of your mortgage term or interest rate. That's when you really start to pay down the principal and can turn the tide.

Sure, i was just working with the proposed numbers. Taking out new loans on anything repeatedly is a bad idea. Personally i prefer to buy once and cry once. We moved only because we added four more biped feet to our family all at once and our existing 1500 sq ft wasn't going to be enough.

 

[jamil]

My house. No HOA.

View attachment 361986

Oh. “Doggy Daddy”. It’s all making sense now. You’re the coon dog breeder whose dogs are barking all night.

 

[Destro]

I loved living in a HOA community. Served on the board for 8 years, president for 6. The requirements were reasonable, the board ruled with common sense, and we rarely had issues.

$1500 a year covered exterior maintenance, lawn care, and snow removal. I usually think about those days when mowing myself now.

 

[Ingomike]

I'm not sure how that math works so let's see.
House Purchase Price 100k (easy numbers) 3% DP
House sells for 106k
We'll assume a 7% interest rate over 30 years which means they'll have paid ~$5400 on the principal in 5 years.
Add their initial down payment and appreciation (3k + 6k) subtract 6% closing costs ($6360) and you get ~8k for a new down payment. To make a 10% down payment they now need a purchase price of 80k. To make a 20% down payment they need a 40k house. I sometimes do bad math, but I'm don't think the math supports what you're advocating.

Yes they have more down payment but house prices have also risen and there are a lot of costs associated with selling and this is ignoring all the opportunity costs. You could even say they are great negotiators and got their closing costs down to 3% of the sales price and things only get marginally better. They could then go buy another 100k house and have a 10% down payment but that will likely be a downgrade in the quality of the house to maintain the 100k price point. Appreciation would be great if it was only your house that was appreciating but when its all the houses its a wash.

The first thing is that pre bidet the typical appreciation was about 6% per year (2009-2011 not including) over five years, so the typical appreciation on $100k would be about $30k over five years historically.

The rate doesn’t really play into my calculations. I calculated about $10k paid down though you are correct that the current higher rates will the increase interest portion of the payment. The problem with the $100k example is that while the numbers are simple it does not reflect real world, but I will try.


Typically a $100k buyer would move up to the $185k after selling for $130k. They started with a 3% downpayment and after five years had at least a 10% for their next house. They need $18,500 for their 10% downpayment leaving $11,500 for other expenses.

Now if their incomes have stagnated or reduced then that changes things. If their incomes have risen typically over the five years they can qualify for a bigger mortgage with a higher downpayment to buy a bigger or more expensive house that also appreciated similarly to their own.

 

[Ingomike]

The real magic is not moving every five years. When you do that, all you do with a 30yr mortgage (as your example showed above) is pay interest, barely any principal.

I prefer the thirty year mortgage and discipline to make the equivalent 15 year payment. This gives the ultimate in flexibility to those disciplined. Folks must know themselves and their abilities to stick to a plan.

If you have a 30yr, you really need to send more than your "required" payment, even just $100/mo to help pay down the principal quicker. That or try and refi into a 15yr mortgage.

Much cheaper to pay 15 year payments on a 30 year mortgage than pay refi fees.

The 7% rate is absolutely killer and will hurt many in the middle class, if you can't pay extra or refi your way out of it, you're just throwing tons of money at interest.

And that rate is the historical average that lots of folks did just fine with over the last 40 rears.

The magic happens when you stay in the same house 10, 15, or 20 years - regardless of your mortgage term or interest rate. That's when you really start to pay down the principal and can turn the tide.

Very few can buy that home they want first. Most use the move up technique to get to the home and property they really want and if they work at it they can pay things down to be able to get there then stay so they can pay it off.

No, Top Golf. That's my kind of golf. Great food and drinks brought right to you (no need to try and find the "beverage cart" out on the course). They even have heat in the winter and restrooms always just a short walk away!

LOL

 

[firecadet613]

I loved living in a HOA community. Served on the board for 8 years, president for 6. The requirements were reasonable, the board ruled with common sense, and we rarely had issues.

$1500 a year covered exterior maintenance, lawn care, and snow removal. I usually think about those days when mowing myself now.

Blasphemy!

This is the hate all things HOA thread!

 

[KLB]

I loved living in a HOA community. Served on the board for 8 years, president for 6. The requirements were reasonable, the board ruled with common sense, and we rarely had issues.

$1500 a year covered exterior maintenance, lawn care, and snow removal. I usually think about those days when mowing myself now.

Was that for a house or a condo?

 

[jamil]

Blasphemy!

This is the hate all things HOA thread!

No. It's the Why Do So Many On INGO Hate HOA's?

Many of us thought it was a good faith question, and answered. And then found out it was just so Mike could lecture us that we should be of the same opinion as him. Because freedom.

 

[firecadet613]

No. It's the Why Do So Many On INGO Hate HOA's?

Many of us thought it was a good faith question, and answered. And then found out it was just so Mike could lecture us that we should be of the same opinion as him. Because freedom.

Did you really expect anything different?

 

[jamil]

Did you really expect anything different?

Eh, I try always to be hopeful, while tempering expectations to what's practical.

 

[BugI02]

Then why is this circle jerk continuing?

I believe because the only two people who love them some HOAs won't take **** no for an answer

 

[Ingomike]

What thread will @Ingomike start next?
I've learned so much in his threads...

Dew on the grass isn't dew.
Nocturnal twilight is a thing.
DST really gets people wound up (even more then HOAs).
Cyclists really **** people off.

Dew on the grass isn't dew. Not mine
Nocturnal twilight is a thing. Not mine
DST really gets people wound up (even more than HOAs). Not mine
Cyclists really **** people off. Not mine

Seeing a pattern…

 

[Creedmoor]

No. It's the Why Do So Many On INGO Hate HOA's?

Many of us thought it was a good faith question, and answered. And then found out it was just so Mike could lecture us that we should be of the same opinion as him. Because freedom.

Funny how hes not a poster in the gun threads on a gun forum.