[quote=AN][quote=kcal09]That is absolutely correct. That’s why I bought my house in cash…[/quote]
Uhh… (unless I messed up my calculation)hope you know that if you bought it in cash for $850k, then you’re actually pay more than if you would have financed it over 30 years (assuming 6% return for your cash). $850k cash today, assuming 6% return will equal $5.1M in 30 years. The buyer of such $400k house really paid ~$770k. The $450/month in MR is $162k over 30 years. So $5.1M-$770k-$162k = ~$4.16M.[/quote]
let’s not forget we have 30 years of inflation to look at. If the rate of inflation over the next 30 years is on pace with inflation from the last 30 years, that $450 per month in 30 years would really be $181 per month in today’s dollars.
and assuming someone paid 20% of 850k and financed the 80% at 4.5%, that $3450 per month mortgage after 30 years would be $1400 per month in today’s dollars.
all that really proves you do not take today’s monthly payment of something and extrapolate by 30 years. that was my point in the first place.
rather you compare apples to apples and simply ask the question of how the addition of $450 per month in mello roos impact a buyer’s purchase power here, today. and that impact IS a $82k loss in purchase power.
