In our discussion this weekend about why people would walk away from a mortgage, even though they can afford to continue paying, Tim Kane (S-Crow) pointed out:
It doesn’t take much emotional pull to consider walking away when you see property being purchased across the street for $150,000+ less than what you may have purchased your place for in 2006 and it costing substantially less to cover the monthly payment at today’s market prices. This is more prevalent in newer developments and I would guess can make for interesting neighbor to neighbor discussions.
Well, I spent a little time on Redfin looking at some new construction homes for sale, and it didn’t take long for me to find some examples similar to Tim’s hypothetical scenario:
Development: Camwest “Tambark Springs”Floorplan: ~1,700 sqft, 3-bed, 2.5-bath “Aspen” (pictured at right)
Past sales:
New units’ current asking price: $319,950 (~20% off)
Development: Camwest “Shamrock Heights”Floorplan: ~2,500 sqft, 3-bed, 2.5-bath (pictured at right)
Past sales:
New units’ current asking price: $459,950 (~19% off)
In the first example above, if we (very generously) assume that the folks that bought in ‘06 and ‘07 had 20% down payments and got 30-year fixed-rate mortgages at the going rates at the time, their payments would presently be around $2,400. Today’s buyer with the same sized down payment would have a monthly payment around $1,700.
That’s a ~30% difference in payments. The ‘06-’07 buyers are spending $8,400 a year more for the same house as their neighbors. I imagine most people can think of lots of things they’d rather do with $8,400 a year than to continuously pay for a poor decision they made years ago.
There are tens of thousands of buyers around Seattle who bought at or near the peak with little to no money down. Many of them even got a mortgage that they can technically afford (got ramen?). At the time they bought, it made sense to them to squeeze their budget, because they bought into the notion that if they didn’t get something right away, they would be priced out forever.
Every month that these peak buyers spend in their peak-purchased house they’re basically “throwing away” hundreds (sometimes thousands) of dollars. Selling isn’t an option, because they owe so much more than the home would sell for. Walking away starts to make sense.
I’m not saying I necessarily recommend walking away as a course of action (or that I don’t), but I can absolutely understand the rationale, especially when you’re in a situation like the above examples, where people buying the exact same house today are paying thousands less per year.
S-Crow » Jun 29, 2009 at 5:47 am
Spoke with a builder a just a couple weeks ago that said they never thought they could ever lose buying land. (obviously in retrospect after incurring losses).
I have tremendous respect for the micro-builders out there who have done a stand-up job making a living for their families and are doing everything they can to make a go of it in this environment.
On the flipside, I have zero respect for builders who are having to answer to the IRS for not paying employee taxes (essentially stealing from them in my opinion) or knowingly hired sub-contractors (small business people) that they knew they could never pay them— just to get product to market while shafting the little guys (tile setters, roofers, plumbers, electricians, painters) and putting them either out of business or in financial distress. COMPLETELY REPREHENSIBLE.
Kary L. Krismer » Jun 29, 2009 at 9:45 am
I had a listing that sold last month for almost 200k less than its 12/06 sales price (679k), and other nearly identical properties sold up to $50,000 less than my unit’s price. And this was merely newer construction, not new.
But one of the risks of buying new construction has been that you’re paying a premium, and for what? To me it’s just paying for uncertainty over what the neighborhood will look like and uncertainty over the construction quality.
D. » Jun 29, 2009 at 10:48 am
This may be a remedial question, but if you walk away from a mortgage and you have other assets, could the bank sue you for those assets? Perhaps many people don’t walk away of an upside down mortgage because they have other assets.
Scotsman » Jun 29, 2009 at 10:52 am
I’m sorry, but $400-500 a square foot is high-end luxury home territory, not run-of-the-mill development fare.
High-end new/recent construction on my street is closer to $200 square foot. It’s 30 minutes to the downtown Seattle core, and you don’t have to look at your neighbor’s house from all but your front windows. Anyone who bought those chocolate boxes is nuts.
We still have a long, long way to fall.
Flying Ape » Jun 29, 2009 at 10:57 am
As your blog perfectly exemplifies the current correction in housing is being lead by distressed, bank owned, and developer owned properties. We have yet to see these prices reflected in individual sellers asking price since they have unrealistic expectations and/or they think they can wait it out. We will never see a recovery until sellers recognize the true value of houses and price them accordingly. If anyone is thinking of “waiting it out” by renting out that second home don’t do it. All you are doing is delaying the inevitable and lengthening this real estate mess.
The Tim » Jun 29, 2009 at 10:58 am
By Scotsman @ 4:
I must have missed something. Both the examples I posted are (currently) in the $180-$190 / sqft range. What are you referring to that’s at $400-$500 / sqft?
Kary L. Krismer » Jun 29, 2009 at 11:01 am
RE: D. @ 3 – That’s what I referred to with judicial foreclosure. It’s somewhat unlikely on a personal residence because they have to let you live there one year if they want to collect the deficiency. But as I said yesterday, I’ve started to hear stories of it occurring (stories I don’t necessarily believe).
Ray Pepper » Jun 29, 2009 at 12:10 pm
Kary I get asked this it seems every week. The He-Loc 2nd’s people have on their homes. It seems many people have stopped paying on them because they are upside down on their 1st. They figure they will never foreclose on the property as long as prices remain flat and there is no $$ to obtain. We know that the lender in 2nd will remain on title but the question I get asked is if you foreclose do the banks actually go after the owners for the 2nd position deficiencies? Will they get judgements in their county of record?
If so the bankruptcy numbers will surge higher then I have even imagined. I know many people not paying on multiple Heloc’s and it appears they will eventually have to file to extinguish that debt? Am I correct?
In Washington, being non-recourse, the 1st is gone without any further concerns other then credit. Its the 2nd’s I’m concerned now for clients.
Steve Tytler » Jun 29, 2009 at 1:53 pm
I think it would be a terrible thing if “walking away” from your morgage loan ever became socially acceptable.
And I’m not just saying that because I own a mortgage company.
Think what would happen:
Banks could no longer depend on 95% of the borrowers to pay thier mortgage payments on time,
which is the historical average.
If 10% (or more) or borrowers started to walk away from their obligations even though they had the financial
resources to make the payments, banks would have to raise mortgage interest rates dramatically to compensate for that risk. EVERYBODY would have to pay “subprime” mortgage rates of 10-12% or more.
Raising interest rates would prompt more people to walk away …
And you have vicous cycle of economic destruction.
What makes the system work is that MOST people care about their credit rating and don’t want to trash it to cut their housing expense. They also think of thier house as a “home” and not just another financial investment.
Frankly, if everybody looked at the housing market the way most of the posters on this blog do, the entire real estate industry would collapse because nobody would ever buy .. they would always be looking and waiting for the proverbial “bottom” of the market.
I understand your feelings, and I am the same way. For example, I NEVER buy a brand new car because it’s such a waste of money. I always buy used cars. If everybody did the same thing the entire car industry would have collapsed many years ago.
My point is that you better hope that walking away from a mortgage does NOT become socially acceptable or we will ALL pay a very steep price.
Maybe it’s time to bring back Debtor’s Prisons. ;-)
mr.finviz » Jun 29, 2009 at 2:00 pm
Here’s an interesting research addressing the topic of discussion
http://www.financialtrustindex.org/images/Guiso_Sapienza_Zingales_StrategicDefault.pdf (pdf)
I think there is some truth to that research. It might not be very accurate but fairly close. After a certain decline in prices the number of people walking away is a function of the house prices and not if a household can afford the mortgage or not. If it’s socially acceptable or not only time will tell but here’s a question to you folks – do you value your credit score worth $100k-$150k??
The Tim » Jun 29, 2009 at 2:05 pm
By Steve Tytler @ 9:
Alternatively, maybe they would just start requiring more “skin in the game,” no exceptions. If everyone were required to put down 20%, far fewer people would even be upside down in the first place. Oh and it likely would have largely prevented the crazy out-of-control price growth that led to the current bust in the first place.
Ray Pepper » Jun 29, 2009 at 2:05 pm
RE: Steve Tytler @ 9 –
Steve, family first…ALWAYS….The Seattle Bubble group is definitely not indicative of society as a whole. What we say here on Bubble will NOT start a cavalcade of people doing anything in mass. However, the Bubbleheads I have met are definitely a giant leap above the average home buyer or seller.
Watch the Fed for guidance. If Mtg Cramdown, or a variation of it, is not initiated soon the foreclosures and short sales will continue relentlessly. I believe we will see STRONG incentives coming out for people to stay in their upside down homes.
Credit is not enough of a deterrent for people to pay 50-500k upside down. Everyone needs to focus on their own family and what needs to be done.
Until further notice, or I see a brilliant plan in action, we are trendline down for the rest of this year and next and the masses will continue to walk.
Scotsman » Jun 29, 2009 at 2:41 pm
RE: The Tim @ 6 –
That’s strange- when the page loaded the first time all I saw were the first three digits, no link. I assumed it had to be cost per square foot, as that was the only thing that made sense. Now I see the total price and the links. So please disregard my previous comments.
Or, I could be loosing my mind! ;-)
Anonymous Coward » Jun 29, 2009 at 2:43 pm
My neighbor bought just last year, and he’s 100K down. He’s retired, sold his previous house to the school district to build a new school. I’m hoping he bought the place outright, I’d hate to see it turn into a Mexican flophouse.
Scotsman » Jun 29, 2009 at 2:58 pm
RE: Steve Tytler @ 9 –
Ooh- Steve experiences the venerable “ah hah!” moment.
Yes, it will be very bad. What’s missing from the markets is trust. You can’t trust the banks, you can’t trust the borrowers, you can’t trust the government or the media to tell you the truth. People are so divided they can’t even agree on the standards. Honesty is AWOL. Everyone, from the lenders to the politicians to the investors is openly gaming the system, twisting the law, thinking short term and ignoring consequences that may not even exist as the future unfolds. It is a cultural breakdown that will end very badly.
Most depressingly, those entities that are charged with setting and enforcing the limits are in on the game. The rules are arbitrarily applied, subject to influence, and too often flat-out ignored. Unfortunately the system was never set up to deal with this level of general immorality, as it assumed the players would at least recognize some ground rules. That doesn’t seem to be the case though. Revolution and reset, within a decade
anony » Jun 29, 2009 at 3:24 pm
RE: The Tim @ 11 – Agreed The Tim. In fact I thought that was why the banks asked for 20% down in the first place, because it was well known that with less down borrowers were far more likely to get underwater, default, and the bank would never recoup the deficiency.
But I guess that’s just crazy. You could only sell mortgages to people who can save money and that would mean far fewer (bad) loans.
Is Steve Tytler suggesting we send mortgage bankers to debtors prison until they can make good to the investors?
Alan » Jun 29, 2009 at 3:54 pm
RE: anony @ 16 –
Throw the walkaways in prison.
Throw the bankers in prison.
Throw everyone who can’t pay anything back in prison.
I expect this to be a very large percentage of the population.
It might be more efficient to wall off a small area of the country, call the inside of that wall “freedom” and say that everyone outside of that wall is “incarcerated”. Then we take everyone who is paying back their debt inside that walled off area. It will be much more efficient to place guards around that wall than placing them everywhere else in the country. Also, since it is all prison outside of the wall, we would only allow the people inside the wall access during “visiting hours”.
The people inside of the wall will have to work very, very hard to support the prison system (we may need to pass laws allowing forced labor), but that is the price you have to pay for a fiscally responsible society.
Greg Perry » Jun 29, 2009 at 4:58 pm
Speaking of Camwest, I heard that Camwest gave up a couple of their large land holdings last month on the Sammamish Plateau.
Here’s something that I’ve been pondering. I think that banks that have huge holdings in building lots may be seeing extra red in coming quarters. Keep in mind, many of these banks stayed away from sub prime and exotic loans, but did have a huge niche builder business.
Also, IF the banks are not allowing construction loans, then what happens to the current value of a building lot? We generally figure that a building lot’s value is 25-35% of the finished end product. Somebody, either a current buyer or the current lot holder may be holding these suckers for a long, long time.
B&W NIkes » Jun 29, 2009 at 5:42 pm
RE: Steve Tytler @ 9 – I think It’s probably worse that people were negligently offered harmful loan products, whether by innocent or unscrupulous participating vendors. If this was any other product nuking peoples life savings there would be huge lawsuits and charges against the vendor of said product. Debtors prisons? Not even funny, just sad and ignorant. How about lenders prisons? Or re agents prions? Jeez.
S-Crow » Jun 29, 2009 at 5:52 pm
I think you are dead on correct with that thought Greg.
Yes, the regional and local banks stayed away from toxic lending per se, but the buyers buying their niche builder business financed their purchases with these loans. Maybe during the next cycle these bank exec’s (if they are still around) will actually research what type of loans buyers used to finance their builder inventory at such a frenzied clip. This is why I and probably others have such a hard time understanding local bank executive staff commenting that the extent of the market decline took them by surprise.
Kary L. Krismer » Jun 29, 2009 at 6:03 pm
RE: Ray Pepper @ 8 – Generally if the deed of trust holder doesn’t foreclose, they can sue at any time up to six years after default. And if they get a judgment it’s good for 10 years, plus can be renewed for another ten.
So yes, people not paying a second have reason to worry. In that case, it might be worth considering a Chapter 13 and possibly wiping out the second and keeping the house only paying for the first. It would depend on the facts, but I think the law currently supports that on the right facts.
Jillayne » Jun 29, 2009 at 6:57 pm
going back to comment number 1, Tim are you seeing mass mechanics liens?
George » Jun 29, 2009 at 7:43 pm
Not paying is a very bad idea. In essence the banks borrow money from us through our checking and savings accounts. If the bank took the depositor’s obligation and decided they would not pay us because they didn’t like the deal they made in essense the whole concept of money and economy collapses and we revert back to an economy where even the concept of property, free exchange and ownership comes into question. You can see this at play now since the government is in essence supplying the money to the system now and in return is looking to reward constinuencies and promote its own agenda similar to a fuedal lord telling the serfs what they need to do to live. Australia has one of the lowest mortgage default rates and one of the soundest banking systems and it is because they allow lenders to seek defriciencies in a timely manner. They have had a real estate market that has cycles worse than ours. This makes the borrower understand this is an obligatiopn not tied to the market. This always used to be the case a long time ago for us but when Glass Stegall was repealed the Wall Street guys thought they had a better idea and in essence underwrote a market based on flawed assumptions and ignored the borrower. The borrowers were just a way to make fees.
Besides none of us knows how this is going to turn out. Borrowers are feeling the pain of defaltion but what if inflation kicks in at say 10%. Then even the house purchased at the top of the market looks good. . That person who walked away from the house and decided to rent will see their rent go way past what their payment was in a couple of years and not be able to buy or borrow money when debt is favored. Walking away is like selling at the bottom of the market.
People who lose their jobs or have medical expenses or unfortinate circumstances beyond their control need a way to get rid of the debt and start ovewr and be able to live but willfully walking away is not good for anyone in the long term. The probelm is that we have had such good examples set in Wall Street and the governmant.
Racket » Jun 29, 2009 at 9:00 pm
“Besides none of us knows how this is going to turn out. Borrowers are feeling the pain of defaltion but what if inflation kicks in at say 10%”
You are amongst a group of people who believe that your credit will be good again, once inflation kicks back in.
I understand what you are saying, but its A +EV move to walk away now.
I personally do not know what will happen.
waitingforseattletocool » Jun 29, 2009 at 9:59 pm
RE: Steve Tytler @ 9 –
Yes, debtor’s prison is my vote.
They still do this in western countries such as Ireland for much smaller debts than what people owe on homes here in the USA.
waitingforseattletocool » Jun 29, 2009 at 10:00 pm
RE: The Tim @ 11 –
Yes, my vote is for 20% down.
Ray Pepper » Jun 29, 2009 at 10:33 pm
RE: Kary L. Krismer @ 21 –
You agree with this Kary?
Bankruptcy? Part 1 – It May Affect Your Credit Score »
By Peter Orville, Attorney at LawcloseAuthor: Peter Orville, Attorney at Law Name: Peter Orville, Attorney at Law
Email: porville1@stny.rr.com
Site: http://www.peterorville.com
Your Credit Score can be an important asset. It determines your ability to get credit, and the cost. It could be a factor in your getting a job, renting an apartment, and purchasing a house or a car. When you file a Chapter 7 bankruptcy, your credit score will be affected. In some cases, however, it’s affect on your credit score may be minimal, and may be temporary.
If you are way behind on paying your bills, and have been for some time, your credit score is already bad. When you file bankruptcy, and receive a bankruptcy discharge, your credit score might actually go up. This happens because all of the creditors listed on your credit report indicate your current balance, your available credit, your past due balance and your payment history. When you get your bankruptcy discharge, each listing on your credit report will simply say “included in bankruptcy” or “discharged in bankruptcy”. The balance due and past due balances will be listed as zero. While the bankruptcy filing is a negative on your credit score, the omission of balances due and past due balances will have a positive effect on your score.
Even if your credit score decreases when you file your bankruptcy, it will not stay low forever. Most people who file Chapter 7 bankruptcy find that within two years of filing, their credit score improves to a good or excellent level.
The myth that you cannot get credit for 10 years after filing bankruptcy is just that…a myth. The advertisements you see or hear urging you to enter into debt settlement to “avoid filing bankruptcy” are designed to give the impression that debt settlement would not harm your credit score like bankruptcy would. The truth is often the opposite.
Jonness » Jun 29, 2009 at 11:03 pm
RE: Alan @ 17 –
I’m not sure which side of the wall represents the worst punishment. How about just brewing up a little bit of extra poison gas and calling it a day?
:)
Jonness » Jun 29, 2009 at 11:05 pm
RE: Alan @ 17 –
I’m not sure which side of the wall represents the worst punishment. How about just brewing up a little bit of extra poison gas and calling it a day?
Sorry so that nobody takes me seriously, that was a joke. :)
Kary L. Krismer » Jun 29, 2009 at 11:11 pm
Ray, I’m not certain how BK currently affects credit scores, but it’s almost irrelevant because most people who need to file bankruptcy have pretty poor credit scores anyway. So yes, filing could be the road to improvement, especially since negative credit history has a limited life on credit scores (unlike foreclosures on loan apps). I’ve even seen situations where someone purportedly needed to file bankruptcy to maintain their job (a security clearance issue).
shawn » Jun 29, 2009 at 11:42 pm
I can’t imagine an honest person walking away from a mortgage that they can afford. Just because they were swindled into losing hundreds of thousands of dollars? What an outrage, we need to stop this now! Next guy who walks is going to have to move into a rental and save hundreds of thousands of dollars and will not be allowed to get swindled again as we will destroy their credit, and forget about using those credit cards and enjoying 20% interest, no now you will need to pay cash. The horror of it all.
George » Jun 30, 2009 at 6:39 am
RE: Racket @ 24 – I don’t believe that, it is only one of the possibilities being promoted in the financial news and is one of the possible outcomes, all outcomes need to be considered. Markets are dynamic. Trees don’t grow to the sky and holes don’t go to the center of the earth. Right now banks are contracting because of residential defaults and commercial defaults are now starting to kick in bigtime so the next year will probably be worse with even more deflationary pressure but if nobody knows five years from now where things will be. The decision to give up your credit has impacts beyond any one, two or three year time frame. .
Kary L. Krismer » Jun 30, 2009 at 6:55 am
RE: Kary L. Krismer @ 30 – I should add to this post that a bankruptcy stays on your credit report for 10 years, while many other items only stay on for 7.
In the past I’ve heard of some credit cards you couldn’t get for the entire 10 years after a bankruptcy. Others you could get as soon as the discharge order was entered.
Sniglet » Jun 30, 2009 at 8:24 am
I don’t see why having consumers make calculated business decisions about their homes would be so terrible. Businesses (and businessmen) do that all the time, yet the economy has gotten along just fine (with the odd depression now and again) for centuries. Banks still lend to businesses even though they completely understand that there are no social pressures, per-se, preventing businesses from defaulting.
If a bank is willing to lend to a corporation, which will have no compunction of defaulting (or filing for bankruptcy) if circumstances warrant such a move then I don’t see why they wouldn’t still want to lend to consumers. Perhaps lenders would want to have higher standards, or require bigger down-payments, if they felt there were no social inhibitions against default. And what would be so terrible about that?
The Tim » Jun 30, 2009 at 8:28 am
By Sniglet @ 34:
EVERYTHING!!!!!!!!!!!!!!!!!!
Kary L. Krismer » Jun 30, 2009 at 8:50 am
RE: Sniglet @ 34 – I think the problem with that is contracts are basically promises, and if the value of the promise is reduced, the price of the contract will increase, meaning less gets done overall.
I don’t have a problem with higher standards, and pricing according to risk. I don’t think you have to eliminate low down loans, however. Just as some people opt for a variable rate, some people might opt for a low down. The problem is more people who NEED low down and are increasing their monthly expenses. It’s rather obvious what’s wrong with that, but even to date the banks don’t seem to take that into account sufficiently.
Scotsman » Jun 30, 2009 at 9:28 am
RE: shawn @ 31 –
Oh, how true!
Batman and The Boy Blunder » Jun 30, 2009 at 9:42 am
I currently live in the Dallas Fort Worth Area, but Have family in the Seattle Area. While I will say that Seattle is much nicer looking City than DFW, with respect to scenery and nature surroundings, I cannot see why anyone would pay even the current prices of new construction. Here is a local DFW builder’s website with Mc Mansions for the same price as the Cracker Jack boxes that are being sold in the Seattle area. http://www.standardpacifichomes.com/new-homes-floor-plans/fort-worth-fort-worth-saratoga-parker-4500.html
Another thing is Texas in general does not have the unemployment figures that Washington has; another reason for the 300K to 400K asking prices being far to high. Those same starter houses in the DFW area can be bought for $75 a square foot all day long; with the added bonus that you have employment. It would be cheaper to own in Texas and Vacation in Washington State than it would be to live in Washington State.
Oh yea and I forgot we don’t have 9 months of rain, or the threat of a 9.0 mag. earthquake, just the occasional tornado that only causes damage to small areas.
Batman and The Boy Blunder » Jun 30, 2009 at 9:54 am
Here is what $400,000 gets you in a highly sought after suburb of Dallas, with GREAT public schools….Oh yea and JOBS.
http://www.remax-texas.com/remaxtx/modules/internet/search/includes/mapsearch/listingpopup.asp?mlsid=3215&mlsnumber=11184230&l=y
http://www.remax-texas.com/remaxtx/modules/internet/search/includes/mapsearch/listingpopup.asp?mlsid=3215&mlsnumber=11195219&l=y
http://www.remax-texas.com/remaxtx/modules/internet/search/includes/mapsearch/listingpopup.asp?mlsid=3215&mlsnumber=11217530&l=y
http://www.remax-texas.com/remaxtx/modules/internet/search/includes/mapsearch/listingpopup.asp?mlsid=3215&mlsnumber=11185162&l=y
I think people in Seattle have drank the Kool-aid, if they think 300-400k for a starter home is priced fairly.
Kary L. Krismer » Jun 30, 2009 at 10:10 am
El Paso is probably pretty cheap too, but that doesn’t mean people should consider living there.
Ray Pepper » Jun 30, 2009 at 10:55 am
My brother lives in El Paso! Great authentic Mexican restaurants. Makes Azteca taste like Taco bell. I couldn’t live there but get this…….Property taxes are 3% of the tax assesed value. I had a rental there I bought new and sold just after it closed. Its now worth 175k and taxes are over 5k!!
The schools, academically , are among the worst in the nation. I ask him where is all the money going? He just shrugs and reminds me of the restaurants and how good they are.
Kary L. Krismer » Jun 30, 2009 at 11:02 am
RE: Ray Pepper @ 40 – LOL.
I just picked the worst place I’ve been to within the past 20 years in the continental US.
Dave » Jun 30, 2009 at 12:22 pm
Kary – Obviously you haven’t been to Baltimore.
rent for now » Jun 30, 2009 at 12:26 pm
Or San Bernardino…
Batman and The Boy Blunder » Jun 30, 2009 at 1:13 pm
Kary, you are correct El Paso is an undesirable place to live and most Texans would agree with you about that.
But, I’m sure Washington has its undesirable locations too.
Just for fun, running some numbers, to compare living in DFW area vs. Seattle; with property tax included.
Sample house will be 2000 SF:
DFW $75 SF vs. Seattle $170 SF = $150,000 and $340,000 respectively.
For the sake of simplicity I will just double the property value to come up with total amount owed to the bank on a 30 year loan. So we have $300,000 vs. $680,000. With 360 payments, each month will cost you $833 DFW and $1889 Seattle. to the bank.
Now for Taxes:
DFW $150K @ 3% = $4500/yr or $375/month vs. Seattle $340K @ 1% = $3,400/ yr or $283/month.
Total:
$833+$375 = $1208 DFW and $1889+$283 = $2172 Seattle.
Difference = $964 a month.
Now over the long term, and after you have the property paid off, Seattle would probably make more financial sense because of the lower property taxes. But, Texas is clearly cheaper by far in the short term to probably 20 years out.
One more thing to consider is the avg. sales tax in Texas is 8.25% vs. 10% Washington.
buystocks » Jun 30, 2009 at 2:20 pm
Batman and The Boy Blunder, Spent 5 years in Dallas. It was downright awful relative to Seattle. The thought of returning to that desert makes me a bit ill. Sorry. To each his own I guess.
Kary L. Krismer » Jun 30, 2009 at 2:31 pm
By Dave @ 43:
Not in the past 20 years.
B&W NIkes » Jun 30, 2009 at 2:44 pm
RE: Batman and The Boy Blunder @ 45 – cheaper is just cheaper, and Texas definitely is that. You get what you pay for and you pay for what you get.
According to easily available not verified info, Dallas median family income is $42,670 where Seattle is $62,195. Dallas has about 21.7% of the population below the poverty line, where Seattle has about 11.8 percent. So maybe cheaper nickel to nickel, but pretty hard to measure really. I’m sure we’ll happily trade a few coffees for some bbq!
shawn » Jul 1, 2009 at 12:14 am
RE: Batman and The Boy Blunder @ 45 – Can you throw me some numbers comparing where I used to live, Plano, and where I now live, Bellevue? If you want to compare cities by what I would call their soul, then compare Seattle to Austin.