Posted on 12/11/2014 7:21:10 PM PST by SeekAndFind
Dear Mona,
It seems like homeownership is a common data filter in the social sciences. But nearly everyone I know who “owns a home” is paying a mortgage. How many “homeowners” have actually paid off their houses?
John, 34, Mount Vernon, Washington
Dear John,
Your question is an important one, not only because home ownership can have big consequences for the economy, but because 56 percent of all the housing units in America (that includes trailers, apartments and houses) are owned by the people who live in them.
According to last year’s American Community Survey, one in three of those owner-occupied housing units doesn’t have any mortgage left to pay.
You and I are talking about slightly different things here, though, John: You’re asking about homeowners and I’m providing data on owner-occupied housing units. That’s because the American Community Survey summarizes data about the country’s 132.8 million housing units, not the individuals who own them.
If these different types of housing tend to have different numbers of people living in them (that seems pretty plausible to me) then these percentages about housing units don’t exactly translate to percentages about people. In other words, this data doesn’t show that 20 percent of Americans are homeowners who’ve paid off their mortgage debt, only that 20 percent of housing units are owner occupied with no mortgage left to pay.
(Excerpt) Read more at fivethirtyeight.com ...
/johnny
10 years left on my mortgage
The way our economy is going and in looking at the people who manage to get reelected; I can’t imagine what it would be like to live in a home with a mortgage. The taxes, insurance, utilities and maintenance are enough to make me sweat the end of the quarter rolling around. We downsized to buy a home for cash, but we sleep well.
PAID IN FULL.
Free and clear, last 20 years. Just taxes and Insurance.
free and clear... had a hell of a note burning party too!
“Not having a mortgage is nice, but I still have to pay the local shakedown/protection racket..... er government once a year.”
Agree 100%. Every time they reassess our home I’m at the courthouse fighting with the assessor, armed with the actual comp sales in the neighborhood. I’m convinced the assessor takes special delight in bumping up the tax values of those homeowners who scrimped, saved, and worked hard to throw off the chains of the mortgage bankers. After all, from his perspective we can afford it having no mortgage!
well we had our mortage pretty well paid off many years ago but got a HELO and paid for college tuitions, two weddings, vehicles, and a brand new shop with a walk in cooler and meat shop...thus, we’re way up there and converted to a regular mortage at 4%...I’m 61 still working though....
My parents bought their home and land with a VA loan. The $45 a month was not all that bad back in the early 60s but by the time they paid it off, it was hardly anything.
They got a homestead exemption and later an elderly exemption. Hardly any taxes at all. I think it was something like $60 a year.
About paying down mortgages:
Just read Priceless by John Goodman. It explains how we are going to bleed.
Here is an email
I wrote him: This is a letter I wrote the author :
ME: I am reading your book Priceless By John Goodman and enjoying it. It is thoughtful. I am an older women with income property investments, own my own home, I work in health care, part time as a private practitioner and part time in a large healthcare complex.
One thing that seems clear about the current health care debacle is the control the health care industrial complex and the government will have over my assets. And there seems to be no way around it. Tell me if I am wrong to believe this. It will help me sleep at night.
I am being told that I must have Medicare and an insurance overlay or pay penalties. I pay extra for the overlay. If for some reason I cannot pay for the overlay, and require care I will be put on Medicaid, and given care and my assets forfeited to the state/healthcare complex.
Now I understand that this has been a way to manage folks with small assets, in our community giving a house to the town for taxes and bills has been common for years. Our towns use to let the elderly live in their houses until after the death, then foreclose.
However the current combination of insurers, healthcare entities, and government can provide a very different picture. The government has opened a window to previously untapped assets, older people who have previously been able to cover their healthcare insurance, keep their assets intact and provide a boost for the next generation.
It seems to me that all the government/insurer axis needs to do is change the insurance price point depending on the financial needs of the insurer or healthcare institution. Less people able to afford, more assets turned over.
The other part, is how prices in healthcare do not reflect reality but instead, a very unrealistic and non market based assumption. I see it in my own pricing for services in the market.
Now I am not opposed to paying for my own healthcare, but I damned sure refuse to be subjected to or pay unrealistic, manipulated and dictated prices, which affects everything from equipment, prescriptions and services.
Both these issues combine to provide a perfect storm of assets to be sucked out of the middle class. I would really like your opinion here. You have a reasoned free market perspective. You are also a good writer, rare in economics.
Thank you for your time.
JGoodman: You have provided a very good description of both problems.
ME: And my attorney tells me that there is no way to shield my assets from the government/medical/industrial complex. Very painful to hear.
Some consumers take themselves out of the market with healthcare medical bill sharing, I could do that and if they will have me, that will probably be my choice. I am not sure that the complex’s reach won’t make that a futile gesture though.
Thank you for confirming what I have tried to talk to people about to no avail.
Interesting that my acquaintance who has lives a rather dissolute life, who never paid off anything including her student loans, owes tons on her house, with a low payment, will be able to keep her house, and I would lose mine. Painful.
Free and clear since March but taxes & insurance are about $600.00/month.
Our local school kids must be making double digit yearly increases on the SAT tests to match the double digit property tax increase!!
Paid in full here.
Paid off my house when I was 61, sold for 5 times what I bought it for. I moved to Texas and paid cash for a new house with half of the money then banked the rest. I sold a shack in RI and bought a mansion in Texas. Well it is a mansion to me.
Taxes and insurance are killer.
A little Dave Ramsey lingo there.
Paid off my mortgage some years ago. But I still don’t “own” my house....
Guess what happens if I lose my job and can’t pay my property taxes. Yep.
On the other hand, if someone slips and breaks his leg on my front porch, the property is mine, all mine.
Home “ownership” is an illusion. But if you can swing it, it’s still cheaper than renting a place.
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