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1/22/2020 12:12:56 PM
Posted: 1/2/2007 7:25:38 AM EST
I love to watch those 'investment property' shows. You know, where they buy a house, fix it up, then sell it for a profit. I've noticed something I don't understand.

I live in central Ohio. Been here all my life. I'm on my 3rd brand new house I've had built in a little over 10 years. I've seen prices increase in that time. My first house was around $86,000. The second was around $100,000. These were both in standard subdivisions. My current house is a standard 3 bedroom/2 bath on a couple acres out in the country. It was around $160,000.

On these shows they are buying dumps in California for what I paid for my current home and selling them for $250,000-$500,000. WTF? In Columbus that equivalent house could be had through HUD for $20,000. You can go into a 'step up' from the standard subdivision and build a fancy house for $200-$250,000.

Around here average people make $15-$20 an hour. I make around $30/hr with tons of $45/hr overtime. I consider myself very lucky as in I make way more a year than anyone I know.

So what's the deal? How much do you make and where do you live? Do you people make like $150/hr in California or something? I just don't get it.
Link Posted: 1/2/2007 7:27:29 AM EST

Is the value of the dollar different across the US?


Yes
Link Posted: 1/2/2007 7:32:15 AM EST
Consider yourself lucky... around here, we have "Ohio" wages (or worse), and "Kalifornia" housing prices.
Link Posted: 1/2/2007 7:34:40 AM EST
Basic standard of living cost.

I would bet I pay about $.50 more for gas than you aswell.

To compare, my parents 3.5 bedroom, 2.5 bath cost about $3-350K to build. This was about 16yrs ago. Nothing special, just an upscale neighborhood, but it wasn't even 30% developed when we got in.
Link Posted: 1/2/2007 7:36:32 AM EST
[Last Edit: 1/2/2007 7:41:44 AM EST by Admiral_Crunch]
Value of the dollar, not that much, technically speaking. Value of property, very much so. Then you have to pay people more so they can actually live there, so costs of other things like services go up as well.
Link Posted: 1/2/2007 7:37:26 AM EST
I've spoke with a really nice guy that was from northen LA, he said the average wage for a non-student was about $8 an hour, I was floored. But he was doing ok for himself, had a house (might have had wheels, not sure) and a nice late model pickup. He was a hard working sharp guy and could do much much better for himself by just moving to another zip code.

-JTP
Link Posted: 1/2/2007 7:41:00 AM EST
I don't think the dollar is valued differently. I am betting all the Wal-Mart prices are pretty close to the same in both Louisiana & LA.

Property is based on desirability. More people want to live in California than New Orleans so housing is priced that way.
Link Posted: 1/2/2007 7:42:21 AM EST
Picture this. In Florida a single wide trailer on a quarter of an acre or less costs $150,000 not $50,000 like most places. The average employee still makes $5.50 to $8.00 per hour for the majority of sales jobs.

I live fine but I don't see how 85% of the hourly employees live around here. Maybe that's why I see a lot of bicycles around here.
Link Posted: 1/2/2007 7:45:26 AM EST

Originally Posted By SS109:
Property is based on desirability. More people want to live in California than New Orleans so housing is priced that way.



It's not necessarily desirability, but scarcity that drives prices. Sometimes desirability leads to scarcity. But sometimes excess demand creates scarcity too.
Link Posted: 1/2/2007 7:46:55 AM EST
In a way yes...

The cost of living is definitely affected by your location.

Go to Manhattan and get an apartment, and then go to Nebraska and rent one.

Price vs size ratio is going to be very slanted.
Link Posted: 1/2/2007 7:47:32 AM EST

Originally Posted By SUPERSPORT:
I I make around $30/hr with tons of $45/hr overtime.



Is your company hiring?
Link Posted: 1/2/2007 7:52:39 AM EST
Yeah, I'm in wyoming in one of the largest cities in the state. Mean income is around $33,000 a year and you can buy a decent two bedroom house for about $150,000. I think most of it boils down to population of the work force, land value and economy base.
Link Posted: 1/2/2007 7:56:59 AM EST
[Last Edit: 1/2/2007 8:01:22 AM EST by speedracer422]
Cost of living, value is different everywhere.

I live in the "armpit" of Western Pa. The median HOUSEHOLD income for the town I live in is right under $25K. The average house cost a little under $40k in this wretched place, more in surrounding towns and boroughs though.


Cost of living is very cheap here and the terrible wages reflect that.

I've stayed in the +$30k per year mark for the past few years and was considered by my friends and family to be doing well. I was making a little over $60k at my last job and was considered "hood rich" Obviously in other parts of the country, those wages aren't shit. But when you figure that the price of home ownership is so low here...

I have a friend in real estate that lives in LA, she does very well if she only sells one house per month, however, an average home is around $400k in the area she lives in, if not more. Location, location, location...

Speed
Link Posted: 1/2/2007 8:00:35 AM EST
One of the biggest factors to land value you will see is how much the area has been developed. An area at 20% capacity will cost less than an area at 80%. Why buy an overpriced place if there is land to build new. But if there is no more land, the supply is stagnant and demand continues to grow.
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