Housing Affordability Index

All the different ways of solving the shelter problem. To be static or mobile? Roots, legs, or wheels?
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sky
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Housing Affordability Index

Post by sky »

Here we are at the peak of the housing bubble...

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Riggerjack
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Re: Housing Affordability Index

Post by Riggerjack »

Looks like counties are a lot smaller, if they were formed when politicians rode horses...

bostonimproper
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Re: Housing Affordability Index

Post by bostonimproper »

I grew up in the southwest, live in the northeast now, and I have no idea why with the increasing frequency of wildfires and drought conditions so many people seem to be flocking out west. It’s honestly baffling to me.

jacob
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Re: Housing Affordability Index

Post by jacob »

Illinois for the win.

Western Red Cedar
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Re: Housing Affordability Index

Post by Western Red Cedar »

bostonimproper wrote:
Mon Sep 26, 2022 7:18 am
I have no idea why with the increasing frequency of wildfires and drought conditions so many people seem to be flocking out west. It’s honestly baffling to me.
It is a little baffling to me as well. Many people I talk to seem relatively unconcerned about wildfires and wildfire smoke. They'll sit out on restaurant patios drinking beer and eating overpriced hamburgers while the air quality index is above 150 or 200. I live in a community that has plenty of water, but moving to the drought-stricken SW seems even crazier than moving to the mountain west that is dealing with wildfires for 3-4 months of the year.

I think a good chunk of the migration is outward flow from California to other western states (and Texas). When I look at in-migration for WA, OR, and ID I don't see much coming from the south or east coast. So it is more of a reshuffling than a flocking. Another big attraction is easy access to national forests and public lands for recreation. Lastly, the economies of many of the popular states out west are fairly robust and offer good professional opportunities.

Most people haven't started thinking too much about climate change when making housing decisions. That will probably change soon though.

sky
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Re: Housing Affordability Index

Post by sky »

It is hard to talk about Illinois to people from Illinois. If you say good things, they will immediately counter with a long list of bad things about the state. If you say bad things, they immediately get defensive. I would put Illinois as #4 on my list of states that I admire the most. But I would not subject myself to Illinois taxes.

IlliniDave
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Re: Housing Affordability Index

Post by IlliniDave »

jacob wrote:
Mon Sep 26, 2022 7:44 am
Illinois for the win.
Until taxes are due :lol:

Be interesting to see data for a mortgage payment index as most people seem to buy based on how large of a mortgage payment they can make. I suspect in Illinois relatively low home prices are due in good measure to very high property tax rates. What's amazing is some very high property tax states also have stratospheric sale prices.

chenda
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Re: Housing Affordability Index

Post by chenda »

Western Red Cedar wrote:
Tue Sep 27, 2022 2:05 pm
Most people haven't started thinking too much about climate change when making housing decisions. That will probably change soon though.
I suspect it will accelerate if/when major employers start relocating due to climate change. I imagine some industries are more mobile than others.

Laura Ingalls
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Re: Housing Affordability Index

Post by Laura Ingalls »

IlliniDave wrote:
Tue Sep 27, 2022 4:52 pm
Until taxes are due :lol:

Be interesting to see data for a mortgage payment index as most people seem to buy based on how large of a mortgage payment they can make. I suspect in Illinois relatively low home prices are due in good measure to very high property tax rates. What's amazing is some very high property tax states also have stratospheric sale prices.
I.e. Cambridge, MA

Yea. Illinois for accumulating and Tennessee for retirement is what I read from this map.

bostonimproper
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Re: Housing Affordability Index

Post by bostonimproper »

Laura Ingalls wrote:
Wed Sep 28, 2022 1:08 pm
I.e. Cambridge, MA
FWIW Cambridge, MA actually has pretty low residential property taxes since most of the tax base is from commercial (software, pharma, biotech, etc). So you might have a $600,000 condo that incurs maybe around $100/month in property tax.

Stratospheric prices, 100%. But the taxes are quite reasonable.

IlliniDave
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Re: Housing Affordability Index

Post by IlliniDave »

Laura Ingalls wrote:
Wed Sep 28, 2022 1:08 pm
I.e. Cambridge, MA

Yea. Illinois for accumulating and Tennessee for retirement is what I read from this map.
Since I'm retiring rather late and therefore expect a relatively short retirement, it seems to make more sense to retire in Illinois after doing most of my accumulting in TN/AL. That way I can take advantage of relatively low prices in Illinois as a cash buyer while having gotten dinged a lot less annually for taxes during accumulation. Buying a house in Tennessee would more/or less be like paying ~25 years of taxes up front. Someone expecting a 30-50 year retirement might well be better off doing the opposite.

Laura Ingalls
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Re: Housing Affordability Index

Post by Laura Ingalls »

bostonimproper wrote:
Wed Sep 28, 2022 3:20 pm
FWIW Cambridge, MA actually has pretty low residential property taxes since most of the tax base is from commercial (software, pharma, biotech, etc). So you might have a $600,000 condo that incurs maybe around $100/month in property tax.

Stratospheric prices, 100%. But the taxes are quite reasonable.
Hmm when I looked on Zillow 600k had about $300 a month in property taxes plus an association fee. And they were ~600 sq feet. Seemed pretty brutal to me

bostonimproper
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Re: Housing Affordability Index

Post by bostonimproper »

Laura Ingalls wrote:
Sat Oct 01, 2022 2:30 pm
Hmm when I looked on Zillow 600k had about $300 a month in property taxes plus an association fee. And they were ~600 sq feet. Seemed pretty brutal to me
They are likely citing the property taxes that are currently being assessed by a current non-resident (i.e. landlord) owner. These are typically paid through the end of the fiscal year, even if you are a new residential owner, and then reassessed in the next fiscal year with the residential rate.

The property tax rates are on the Cambridge govt website. For a residential owner, the first $443,056 in property value is tax exempt, with the remainder taxed at a $5.92/$1000 residential rate. So for a $600,000 property, you’ll be charged (600,000 - 443,056) * 0.00592 = $929.11 for the year, or about $77.43/month.

Again, not saying property costs aren’t very high ($600K/600 sq ft condo with substantial HOA fees is pretty standard around these parts), but I think a lot of people that think of Massachusetts as “Taxachusetts” may be working under outdated experiences or assumptions of the tax regime out here.

sky
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Re: Housing Affordability Index

Post by sky »

I am in the middle of Illinois today and checking things out. I am seeing many house prices below $100k and pretty high quality of life potential. I talked to a woman who complained of high property taxes but they were a lot lower than what I pay. I wonder if Illinoisians are comparing their property tax with that of Indiana or Iowa, which are both low tax areas. This is only my perception, I have not done any research on tax rates. I suspect that low housing prices are related to job losses and outmigration, not taxes.

I am not planning to move here, just passing through at the moment.

Laura Ingalls
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Re: Housing Affordability Index

Post by Laura Ingalls »

@boston
Interesting. That’s a big difference for owner occupied. In Minnesota it about twice the rate for non-owner occupied. In WI there is no difference. In IA each county has a flat dollar amount off for homeowners exemption. It’s ~ $200 per year doesn’t matter if the total tax is $1,000 or $10,000 total.

@Sky Not sure I am surprised Gary is cheaper than Chicago. I would be curious about Rock Island vs Davenport? Or Zion vs Kenosha? Or Cairo vs Paducah? I doubt they are radically different.

sky
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Re: Housing Affordability Index

Post by sky »

I found this site to compare property tax: https://www.tax-rates.org/taxtables/pro ... x-by-state

But in a state, and even within a county, property tax varies quite a bit between local jurisdictions. So with a bit of research and exploration, one could probably find an extremely cheap home with low taxes.

IlliniDave
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Re: Housing Affordability Index

Post by IlliniDave »

sky wrote:
Fri Oct 07, 2022 11:23 am
I am in the middle of Illinois today and checking things out. I am seeing many house prices below $100k and pretty high quality of life potential. I talked to a woman who complained of high property taxes but they were a lot lower than what I pay. I wonder if Illinoisians are comparing their property tax with that of Indiana or Iowa, which are both low tax areas...
Compared to Alabama taxes in my present locale are roughly 6X what they were on my prior home as a percentage of the home's value. That's based on actual numbers for 2 different properties, one in each state. That's a little higher than the tax rate link implies, likely the difference is due to a local surcharge of some sort.

Illinois has relatively low home values (likely due to the high property tax rate even more so than net population loss), but I think the relatively rural/small town 85% of the state is reasonably affordable for those who don't need to live within commuting distance of good-paying jobs or large urban amenities.

jacob
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Re: Housing Affordability Index

Post by jacob »

IlliniDave wrote:
Wed Sep 28, 2022 3:46 pm
Since I'm retiring rather late and therefore expect a relatively short retirement, it seems to make more sense to retire in Illinois after doing most of my accumulting in TN/AL.
Also, in IL you don't pay state tax on SS or IRA income. For younger FIRE people, this is useful for Roth conversions.

IlliniDave
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Re: Housing Affordability Index

Post by IlliniDave »

jacob wrote:
Sun Oct 09, 2022 6:57 am
Also, in IL you don't pay state tax on SS or IRA income. For younger FIRE people, this is useful for Roth conversions.
Hadn't really considered that. Of course for someone like me who is spending 1099R income at the grocery, it's exclusion is a significant day-to-day consideration. Not a lot of room for property tax to go up before that advantage is wiped out, but for now is evens up the scales enough I can afford to prioritize geographic convenience over the tax environment when choosing where to hang my hat.

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