I just read a column arguing that the middle class is alive and well. Here’s the quote that I’m questioning:
There has to be more to this story, right? If not, then i’m an idiot renting while being single and making double that. I put $130,000 into a mortgage calculator and the interest rate would need to be 1.5% over 30 years to get payments below 450.00 per month. Is such a low rate actually available?
I’m thinking it’s more likely they had a large down payment. I’m not seeing how they could come up with a large down payment on $21,000 per year while paying rent and other expenses. Not in a reasonable amount of time. 21,000 should bring home about 1400 per month after taxes. If couple puts away 400 per month a lives on oatmeal and no unexpected expenses crop up it’s still 6 years to get 20% of 130,000. Rent? I live in the SE USA. Not terribly expensive compared to some portions of the US. But getting a non slum 1 bedroom apartment here is gonna be $500 per month minimum. I’m low balling. I’d actually be thrilled with $500. More like $600. So couple in the authors example has $4-500 left over each month to pay utilities and feed themselves. I assume they have a car. Does it ever need repairs?
Anyways, is the example in this article unreasonable? Or am I stupid for not owning a house on $42000? I could actually get a decent condo here for $130,000. If I can get it for $450 per month, sign me up.