Starter homes.......

R

rgp

Well-known Member
Location
Milford,OH
What in your opinion is the price/price range of a starter home?

The real estate 'expert' on the radio just now says....it is in the low to mid hundreds !?

I'm sorry, but too me, so many folks just have the bar set to high.........I bought my first home , my starter home , allot of work, for $15,000 cash . That was in 1988, spent most of that whole summer working on it. Lived there for 13 years......then built this one in 2000.

Now I'm not suggesting that everyone should do it my way but........if a person [or couple] in their 20's-30's believes that they need a starter home, that cost 200-500 thousand dollars ! IMO they are setting themselves up for failure.

Agree?....or am I way off on this?
 

When I started working I was told that you shouldn't buy a home that cost more than 2.5 times your husband's annual salary and it was assumed that you would have a 20% downpayment.

It really depends on the economy, the area, interest rates, etc...

IMO young people should find a cheap apartment and save every nickel until their first kid is ready to start school then buy a home with a monthly payment that allows them to live comfortably and still have the home paid for in fifteen years.

The years fly by so fast that I would shy away from the McMansions and choose a basic ranch home that was big enough for a family and small enough for a retired couple.

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You got your home 30 years ago, and you don't notice prices have risen in the last three decades? The home you bought in 1988, now would cost about $40,000 in today's money. I was going to say that real estate prices vary greatly due to location and demand. But 40 grand is dirt cheap- ANYWHERE. The kind of homes one can buy in my neck of the woods, (Northeastern PA), 40 grand won't buy a place with a roof. I think you have to re-evaluate your housing situation to where the market is today.
 

The housing market is out of control. A modest sized 3 bedroom 1600sq ft home with less than 1/4 acre of land in decent shape in my area is $400-$500K. Any more land than that and you're talking $600K. A fixer upper might be able to be had for $300-$350K depending on how bad of shape it's in. Most younger adults these days don't have the want or the know how to buy a fixer upper and do the work themselves. That's what happens when you have two generations of kids that are told they are too good for manual labor and they must get a college degree to be successful. Meanwhile a good amount of them are in their mid 30's living at home with their parents after college trying to find a job just to pay their student loans. And now we have a shortage of blue collar workers like plumbers, carpenters, mechanics etc.

I honestly don't know where some people get the money to buy the things they have when I know full well they don't have the income to pay for it. Their debt is either enormous or they have some family money, or both. I've always tried to be a "live within or below your means" type of guy. I've always bought the fixer upper and done the work myself.
 
JimW said:
The housing market is out of control. A modest sized 3 bedroom 1600sq ft home with less than 1/4 acre of land in decent shape in my area is $400-$500K.
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You can get that for $125K around here. No problemo. In the San Francisco Bay area where my daughter just recently moved to it would be a million bucks. No exaggeration.
 
The Austin housing market is nuts. $325K gets you a 2/1 with a one car garage, if you're lucky. The small college towns I'm looking at, for a summer home, have such properties for $90-$160K.
 
Trade said:
You can get that for $125K around here. No problemo. In the San Francisco Bay area where my daughter just recently moved to it would be a million bucks. No exaggeration.
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No doubt! They're a million dollars plus in some of the higher end neighborhoods close to Boston here too.
 
You can’t ask a question like this and expect matching answers from a global community.

It depends where you live and what you want. We purchased our first home decades ago but we paid far more than $15,000. That was more of the price of houses back in 1965 where we came from.

Im with Jim here. It depends on what type of house you want and where you want it. If you have skills and don’t mind working then a fix it upper will cost much less. Most people want it ‘open key’ ready and that can cost a lot.

We purchased a lot and had our house custom built. Most things were done with builders grade materials so upgrades were eventually done.

Around here you couldn’t find anything much for under $400,000
 
Nicer starter homes in my area are $650K and up. A 1950s era fixer-upper (and I do mean a fixer!) on my street just went for $575K. Never even hit the market. All cash, no contingencies, no realtor fee. 1400 square feet, 3 BR, 1-3/4 BA, no master suite. Everything needs gutting and replacement: kitchen, baths, all the flooring and even the walls (it features 1970s era paneling right now). The roof needs replacing and there are plenty of exterior fixes required including stucco, wood rot repair, etc., etc. The flipper will have to put at least $80K into it - and won't be increasing the square footage.

It's on a postage stamp sized piece of property - well under 1/4 acre (typical lot is about 8200 SF). Most folks aren't looking for more land than that - more time and money for landscape upkeep, plus more water.

Prices here are high, but professional salaries in our area are quite good so the RE market remains robust.
 
fuzzybuddy said:
You got your home 30 years ago, and you don't notice prices have risen in the last three decades? The home you bought in 1988, now would cost about $40,000 in today's money. I was going to say that real estate prices vary greatly due to location and demand. But 40 grand is dirt cheap- ANYWHERE. The kind of homes one can buy in my neck of the woods, (Northeastern PA), 40 grand won't buy a place with a roof. I think you have to re-evaluate your housing situation to where the market is today.
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Of course I noticed....but $40,000 is a long way from 100-500 thousand.
 
rgp, you can't compare today's prices with those of 1988. My husband and I bought our first starter home in 1960 for $18,000. It was a reasonably nice 3-bedroom split level on 1/3 acre. But I'd be curious to see what anyone could get for that price now.
 
rgp said:
Of course I noticed....but $40,000 is a long way from 100-500 thousand.
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I don't get out of New England much, but I don't know where you'd be able to buy much more than a mobile home for $40K.

Sunny said:
rgp, you can't compare today's prices with those of 1988. My husband and I bought our first starter home in 1960 for $18,000. It was a reasonably nice 3-bedroom split level on 1/3 acre. But I'd be curious to see what anyone could get for that price now.
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My Grandparents bought their first and only home in the 1950's for $11K. It was about 2000sq feet, 3 beds, 2 bath, 1 car garage and about 1/2 acre of land in a nicer part of town. After my Grandfather died in 1979 I moved in with my Grandmother for 2 years, she then sold the house in 1981 for $96K. That same house just sold last Spring for $825K
 
StarSong said:
Nicer starter homes in my area are $650K and up. A 1950s era fixer-upper (and I do mean a fixer!) on my street just went for $575K. Never even hit the market. All cash, no contingencies, no realtor fee. 1400 square feet, 3 BR, 1-3/4 BA, no master suite. Everything needs gutting and replacement: kitchen, baths, all the flooring and even the walls (it features 1970s era paneling right now). The roof needs replacing and there are plenty of exterior fixes required including stucco, wood rot repair, etc., etc. The flipper will have to put at least $80K into it - and won't be increasing the square footage.

It's on a postage stamp sized piece of property - well under 1/4 acre (typical lot is about 8200 SF). Most folks aren't looking for more land than that - more time and money for landscape upkeep, plus more water.

Prices here are high, but professional salaries in our area are quite good so the RE market remains robust.
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There was a fixer upper around our area that fit your description and it sold for $475,000. It needed to be gutted.
Most homes around our area range from about $600, 000 to a cool million. If you want city living then you are generally looking at anything over a million.
 
1400sq foot condos in the heart of Boston are selling for over a million and that doesn't include a parking space which can cost anywhere from $250-$500K depending on the location. I really don't know where all the money is coming from, but they keep building em, and people keep buying em.
 
I just looked up our starter home in the SF Bay Area. We purchased it for $20,000 in 1969. Sold it for $25,000 in 1972. Neither of these is our actual home but are in the same tract so are identical to ours. The beige one is original-other than it looks like the kitchen cabinets were replaced.Still no dishwasher or anything. Says the owners have been there since 1970,house has good bones but needs updating or a re-build. It sold last month for $880,000. The white one is actually either next door or two doors down from our old one. It sold last July for $990,000. It looks more updated but the kitchen is totally original-same cabinets and tile countertops. No dishwasher. They are both 2 bedroom,1 bath.
 

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Sunny said:
rgp, you can't compare today's prices with those of 1988. My husband and I bought our first starter home in 1960 for $18,000. It was a reasonably nice 3-bedroom split level on 1/3 acre. But I'd be curious to see what anyone could get for that price now.
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I'm not comparing the cost of the homes so much as i am the acceptance of amounts. And the so-called [need] to have . My first house, again , fixer-upper bought for $15,000 ...for $42,000 some 13 year later.

There is a nice , two bd/room down the street listed for $89,000 . But this 'expert' is saying that those houses , and ones like it , no one wants?....And apparently he is correct as it has been sitting for close on a year now.

It just amazes me, it seems all these folks with the gotta-have attitude , are also the ones so deep in debt....and seem to be confused as to why.

If they would just stop & do some math, and tone down their 'needs' I really think they could take a huge load off their shoulders......jmo
 
Housing prices have really soared since most of us were young. I grew up in a nice brick home in Denver that was built in the late 1930's...I think my folks paid around $25K for it in the early 1950's. My Sister alerted me, a few months ago, that it was up for sale...asking price of $550K. It is only about a mile from the downtown Denver area, and it appears to have sold quickly...probably to someone who didn't want to fight the commuter traffic.
 
The value of assets doesn't change much over the eons.

These are just rough comparisons:

45-50 years ago you could buy 4-5 gallons of gas with an ounce of silver. You still can.

A hundred years ago you could buy a nice tailored suit with an ounce of gold. You still can.

A thousand years ago you could buy an average horse with two ounces of gold. You still can.

What changed? The value of the paper dollar, which has no intrinsic value, but is more like a promissary note. It has been (purposely) devalued about 3% annually for the past century. Actually, asset values have not changed much but what has changed is the yardstick (dollar) by which we measure the value of one thing against another.

Having said all that,
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I bought this 20 x 24' cabin in 1981 here in rural NYS south of Rochester, on 7.5 acres of land on a dirt road for $27,000. No heat, no plumbing, unfinished inside, no outbuildings.


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I added a large living room and two bedrooms (1280 sq. ft. total), heat and plumbing, although some of the inside still isn't finished and never will be by me. Also added a 32 x 32' pole barn with finished heated rooms inside. The property was recently re-assessed for $100k, which is right in the starter-home price range around here. Considering inflation, money out of my pocket, and my labor, I haven't really added much value to it in 38 years.


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Mrs. Robinson said:
I just looked up our starter home in the SF Bay Area. We purchased it for $20,000 in 1969. Sold it for $25,000 in 1972. Neither of these is our actual home but are in the same tract so are identical to ours. The beige one is original-other than it looks like the kitchen cabinets were replaced.Still no dishwasher or anything. Says the owners have been there since 1970,house has good bones but needs updating or a re-build. It sold last month for $880,000. The white one is actually either next door or two doors down from our old one. It sold last July for $990,000. It looks more updated but the kitchen is totally original-same cabinets and tile countertops. No dishwasher. They are both 2 bedroom,1 bath.
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$990,000 would get you something closer to this here in Canada with about 5 acres of land.
One million US is about 1,351,000 Canadian dollars. This house is $1,250 Canadian
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Check out IKEA!

They are offering "Prefabricated" homes starting
at £86,500 here, a couple of years ago, they are
built in a factory in Sweden and shipped to you
and I think that they are fully furnished to your
choice.

Mike.
 
There used to be a great company here in Florida back in the 1970's. They sold houses that came in "modules". You started out with the basic home, two bedrooms, one bath, living/dining room, kitchen. Then you could buy additional modules to literally clamp onto the house. There was a family room module, a master bedroom suite (with bathroom), a garage. Each room had its own heat source. Through-the-wall air conditioning units could be added.

You could get the house in a couple of weeks and the same for the modules.

It allowed a family just starting out to get the basic house (very reasonable) and add on as they could afford to do so. The modules were well-built as you still see a lot of the homes around.

It was a great idea. I have no idea why the company went out of business.
 

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