bostonbubble.com

[balor123]

I think he meant $100k: $15k taxes, $40k savings, and $40k expenses. Unfortunately, you need to save in several places at once: college for two kids, retirement, and downpayment. Retirement eats up $15k, college say $10k, that leaves you with $15k for downpayment. After 10 years you've got $150k, which ought to buy you a starter duplex in a nice town. After 10 years, I'll be 40 though so that means I won't get a real house until I'm like, what 50 or 55? I should be selling my house then and retiring. At that age, my peers in Texas are moving into their dream houses (keeping in mind that their starter houses are dream houses here). It's ridiculous that someone making $100k has to watch their budget carefully. I stand by my assertion that $150k is needed for this area. You are right that few make that kind of money. The best way to get there is with 2 incomes (each making $75k). Think about it this way - one white collar worker making $100k makes the same as two blue collar workers making $50k. With profligate spending, there's lots of government workers now who fall into that range so competition is just real high here, not to mention that business was allowed and is encouraged to grow independent of housing.

[john p]

People have to understand the distinction between the metro Boston market and outside 495. I wouldn't mix data that is Statewide when you analyze Newton. If you live in Barre, you can live comfortably with $60k, if you want to live in Wellesley, you're living in a studio.

The cost of living today isn't what it was. Being a college graduate used to be a big thing. People used to say "Aaayy College Boy". Not any more. In fact, people are paying $45k per year in college to get out and get a $50k a year salary. When I was a freshman in college, the ratio of the Price of a year of college to your first year's salary was 2.5. When I graduated it was like 1.25 (recession). Today it's like that and sometimes just 1 (if you can find a job).

If you're an engineer, you have to consider two things, first, there are more engineers today than at any time because we have more colleges today than in any time, and second, what the hell are we engineering anymore? We've offshored a ton of our manufacturing and the real growth is overseas. I do know many firms that are working on international projects, but that's not going to last in decades to come.

There was an article in the Globe recently where it showed the top 75 salaries in the State Government. Overwhelmingly it was University of Massachusetts professors and administration. There were two engineers in the whole lot. We got inflation in college tuition costs because colleges were able to have families tap into their home equity during the bubble and hike up their fees and salaries. Today, the bubble has burst, but the Universities still have their high costs and the kids getting out can't find jobs so the proposition of higher education for a better life is less true today than in times past. Young kids who have broken their asses in school dread the thought that they'd have to live in a town that even BORDERS Brockton. I'm in Brockton quite a bit and many people are poor there, but there are as many good people there as anywhere. Once a month I escort the Vets to mass at the V.A. and then go to Cape Cod Cafe for a beer and a pub pizza, or I take the wife to Christos. In areas like this you get to meet people that make a difference. I know the guy who runs the Guardian Angels in Brockton, I know people that work at the food pantries, etc. Some of the guys I talk to are fire fighters and they tell me things like how when things get frightening, they actually have to learn to calm themselves because the biggest cause of death is heart attacks. They have them crawl around in mazes with their oxygen tanks to discipline themselves to stay calm to conserve their air. I mean you don't hear people at a Peets Coffee shop in Wellesley talking about this sort of thing. I remember eating at a diner in Revere and talking with a guy who did Angel Flights, or flew to bring kids to hospitals. I mean you don't really get a chance to understand the depths of people unless you open yourself to them. Not everyone in Brockton is bad. You can take your kids to see the Brockton Rocks baseball team without having to refinance your house. Brockton is actually trying to start an Urban Farming program, so it actually might help them to have some engineers in town, not to mention maybe a few engineers decide what to make in many of these abandoned factories. What I say about the engineers of today is that unlike in generations before, engineers don't have the vision to see something that is broken and figure out a way to fix it and get it running. From what I see coming out of Brockton, I see it coming back at some point, and for all those that want to overpay and live in Wellesley, I don't see them as builders or constructive, I see them as wanting something that prior generations already made. The truth is that prior generations of Wellesley and Weston were the people who actually drained the wealth out of the Walthams and Brocktons.

[GenXer]

[CC]

This thread is very interesting and informative! What John said makes me to think more. Thanks!

Most of my friends around the age of 35 still rent unless they were luck and bought a house before 2002 or 2001. They may make good salaries but have hard time to save enough money to buy a house. However since the market is getting lower, after another 10-15% drop probably in a year or two, most of them should be able to own a house. It's not that bad, though I can't imagine those with average house income people can do.......

[CC]

BTW, John, I searched some of the cities you listed. Actually it's pretty expensive. I guessed unless it's about 40-50 mins by driving, it will not be cheap.

[balor123]

[Chee]

balor 123, I don't think that a single $100K income and two $50K income are the same--remember the $2K daycare tuition you mentioned?
And $50K is not necessarily be blue collar. A lot of white collar jobs are $50K (or less!)

John P, going outside of 495 won't help much for affordability for people commuting to Boston. A commuter rail pass will cost over $200/mo. and parking fee will be $4+/day. There is no way to live comfortably with $60K!

I actually considered living in RI, where you can still find a small cape for less than $200K in ok neighborhoods. Put $100K down and make the monthly mortgage payment to be around $600/mo.
In the affordable part of country, like TX, middle class first-time home buyers with the same level of income usually get this kind of mortgage. A $60K income would work, if you don't care about savings in these area.
But, in MA, the long commute is going to make this plan impossible.

GenXer, I know that renting is cheaper but there is not so many 3br+ for rent in affordable range around Boston. I don't want to raise my kids in crappy 2br triple decker.

[Guest]

I actually do have enough for a down payment on a "starter home" but the only things it seems I'll be able to aford are a "condo" in a 1920's tenement that would be better of getting bulldozed. We were looking at Waltham for example. Not interested in Newton, Wellsley, etc. I don't want to raise kids in a total dump and I also don't want to pay $2k a month for a mortgage.

[john p]

low ball this one:

http://www.realtor.com/realestateandhomes-detail/Melrose_MA_02176_1116226667

http://www.realtor.com/realestateandhomes-detail/50-Old-Nahant-Rd_Wakefield_MA_01880_1116466474

[Wonky]

[GD]

Well, enough people must be buying to keep prices high.

I've been house hunting for 2 years. The towns I love (not newton/wellesley, I set my sights lower - all above average towns within 125 and 495 are okay, even as far west as westboro) I can't afford. (Me and hubby). We earn around 100K after taxes, in our 30s, so technically we can afford 4K/month on house payments right?

But there's no point being house poor. Just rent...if the market determines houses are unaffordable, technically it will fall. (Without ridiculous subsidies to the industry of course).

Technically....lol

http://www.redfin.com/MA/Southborough/6-Meeting-House-Ln-01772/unit-6/home/18427020
Look at this house. Bought in 2007, and trying to list for more than purchase price, despite that news article that claims southborough house prices have fallen 30%... We made an offer (lower than 2007 price) and it was rejected angrily lol. We really like the house, but sometimes there's no point in going after what's not meant to be. =P

Owners still feel entitled to high prices, and most expect some kind of compensation for the lost "wealth". Even Madoff's ponzi scheme victims feel entitled to paper wealth that were never theirs! What do you expect

Chin up, just keep renting lol

[Brian C]

Nicely priced properties inside 128 and near public transportation

MLS #71019297 - Near the beach, very good elementary school - $335k

MLS #71030444 - Close to the property above, slightly smaller, better curb appeal - $350k

MLS #71009964 - Something I would buy. Lots of potential if you ignore the minor cosmetics. Very good neighborhood. Older people, definitely lowball - $350k

[john p]

I liked that third one too. Quincy does have a lot of starter home stock, and it's on the water and commuter and redline access.

Years ago Boston didn't have its sewage treatment figured out and the waters near the city were polluted. They treat the sewage and dump it further out so the harbor is much cleaner. Despite this many people haven't come around to embracing the towns close to the city i.e. Revere, Lynn, Quincy, etc.

Here are a few in Weymouth:

It looks like Brian C was contracted for this kitchen: (this is nice and clean)

http://www.realtor.com/realestateandhomes-detail/126-Summer-St_Weymouth_MA_02188_1116428782

http://www.realtor.com/realestateandhomes-detail/94-Bluff-Rd_Weymouth_MA_02191_1114995036

http://www.realtor.com/realestateandhomes-detail/298-Pond-St_Weymouth_MA_02190_1112369545

Hull is kind of cool:

http://www.realtor.com/realestateandhomes-detail/Hull_MA_02045_1115750286

http://www.realtor.com/realestateandhomes-detail/Hull_MA_02045_1114869293

[CC]

[GD]