U.S. Unemployment Rate Drops to Lowest Since December 2008

[Jordan]

I honestly doubt the avg American even has a clue what they end up paying on a 100,000 dollar home on a 30 yr fixed rate loan , of any rate by thetime it is done...

I think the average American is much better informed today about personal finance than they were in 2006. Not hard to see that P&I on a 30 year fixed loan is $449 a month, which is much less than one would pay in rent on a similar home of similar value. Except, in this case, they will actually own their home when it is paid off.

I have the utmost confidence in the average American to think that simple test above through. Naturally, they're choosing to buy homes and take the debt at rates that may not exist for very long. It's the best move one can make, and it's helping to bring the American economy back to life, a win-win.

[oyarde]

There has to be jobs to support it and that is never coming back in current climate, best case , stagnation , where almost enough jobs to accomadate those ready to enter.

[Tpoints]

If someone offered to lend you $100,000 at a post-tax rate of 2.8% for the next 30 years would you turn that down?

depends a lot on
1) how much I make now
2) how much I make in the next 10 years
3) what happens if I don't pay back
4) how much other expenses I have

Pre- or post- tax rate doesn't really matter, either I have money to pay back or I don't. I don't make borrowing decisions on the interest rate between 1% and 10%.

[Tpoints]

I think the average American is much better informed today about personal finance than they were in 2006.

That's only because of prophets and geniuses like Ron Paul, Peter Schiff, Alex Jones, Gerald Celente, Webster Tarpley.

[Zippyjuan]

I honestly doubt the avg American even has a clue what they end up paying on a 100,000 dollar home on a 30 yr fixed rate loan , of any rate by thetime it is done...

What is the cost of not buying? The opportunity cost- what else would have been given up instead. What would you spend every month to rent instead and still have nothing at the end of 30 years vs buying and having a re-sellable asset? Say you could rent a comparable place for $1000 a month. In 30 years you would have given away $360,000.

My own case is special but I purchased a condo for $108,000 less than fourteen years ago and just finished paying it off early. In that time, if I paid the going rental rate of $1,200 a month I would have spent $200,000 and had nothing for it. I can still sell it for over $150,000. (if I took 30 years to pay it off the rental cost would have come to $432,000!)

[KingNothing]

Zippy, you've got to consider property tax, maintenance costs, mortgage insurance if necessary, home insurance, financing costs, and everything else.

In a lot of cases, renting is still a great financial decision.

[Zippyjuan]

Zippy, you've got to consider property tax, maintenance costs, mortgage insurance if necessary, home insurance, financing costs, and everything else.

In a lot of cases, renting is still a great financial decision.

As I have said many times, that gets added to what they charge you in rent too. You don't escape any of it. And you get nothing in return.

If a person does't plan on staying in one place more than a couple years renting would probably be wiser.

[oyarde]

Zipp is also in California , real estate is different there than normal places.

[GunnyFreedom]

Yeah I've heard this since 2007. At what point will you be wrong?

You have never heard me predict anything before, because I haven't. I expect the crisis around December of 2014 with a series of increasing pain before then starting halfway into 2013.

Just like anyone who predicts things I may be wrong, but I doubt it. We will see.

The primary factor that gave me a rough idea at a timeframe was QE3, which if it continues at the rate pof $40-$90 Billion per month, lagging monetary pressures would begin to really push at consumer price inflation by mid-2013, and with pressure still coming in prices have nowhere to go but up.

A lot depends on what the Fed does then. If they continue or increase the QE3 deluge unabated at that point, the wider crisis I expect around December 2014 becomes inevitable.

[oyarde]

When I was 17 yrs old, I grossed $286.65 per week, good money @ the time, probably around three times "minimum wage"( long time ago ) , I could pay my rent in what I made in a week.Fast forward five yrs , bought my first house , three bedroom , one bath, basement, detached garage on a prestigious street ,nice lot ,38K . I was grossing $364 a week , again , make the house payment with one paycheck.It is , a different world . Kids today @18 or 22 are not going to have the job security I had , are not going to pay the house payment or rent with a weeks pay, are not going to own2 or 3 vehicles that run well that are pd for . Today's prices are for the high earners , not the median income type ,much less the young who wish they were median.