? Guess How Much These Houses Cost |
| Be Careful About Cash-Out Refis ?
July 05, 2005
All house, no furniture
Here's a new trend a colleague just told me about -- in certain New York suburbs, buyers are putting so much of their savings and monthly income into the purchase of big beautiful homes that they don't have enough money left to furnish it.
He tells of families in his Orange County, N.Y., neighborhood that have toddlers running around vacant rooms while the parents try to gather enough savings for a trip to Ethan Allen. Basically, they've taken the conventional wisdom of buying as much house as they possibly can to a new extreme.
Has anyone else witnessed the same phenomenon in your town? (It's not an issue in New York City, where I live!).
In a way it makes perfect sense to me. Why clutter up a big new house with cheap or old furniture? Why not enjoy the expanse until you have the cash to afford some quality pieces that will last?
If I ever sell my New York City apartment, I don't plan on paying movers to relocate most of my battered and worn furniture. Come to think of it, having an empty room for my two-year old to clatter around in, sounds like a dream come true.
TrackBack URL for this entry:
There's nothing new about people buying so much house that they can't afford to furnish it - that's been going on for a long time. It's called being "house poor."
Posted by: Audiorich at July 7, 2005 06:06 PM
I live in Northern Virginia, just outside D.C. A friend of mine is a police officer who has to respond to residential security alarms going off from time to time (most often false alarms). When he arrives at the residence, he checks the perimeter and looks in a few windows. He tells me the houses are quite frequently empty except for maybe a couch and a television. He said he's seen some that just have plastic lawn furniture. These are newer $700k and up houses he's talking about. I'm not sure what the point of owning a McMansion is if you can't furnish it; afterall, you're probably going to be too embarrassed to invite your friends over for fear they'll laugh at your indoor lawn furniture. To each his own I guess!
Posted by: tooskinnejs at July 13, 2005 01:17 PM
About 7 years ago my Sister purchased a very large luxury townhouse in Rosslyn, VA, just across the River from DC. She makes very good money and I was surprised that she did not have furniture for every room. Well, seven years later I realized why; she wanted to make sure she had the right pieces for her place, so she simply took her time.
Not everyone who has a "barren" house is house poor. Some simply want to decorate it exactly the way they want and are willing to wait.
Sure, you can run out to Marlo and buy a house full of furniture for $2k, and then turn around in 5 years and do it again, or you can put pieces in that will hold or increase in value. It all depends on the person.
Posted by: Hnorc at July 25, 2005 01:36 PM
Nothing tackier than a tract mansion filled with plastic furniture! Money can't buy class.
Posted by: Megan W. at January 16, 2006 04:20 PM
I have some friends who are in the same predicament. Using $200 Wal-Mart futons surrounded by $50 wal-mart entertainment center in the living room of their 2800 SQ. ft house for a couple working DINKs. I wish I could say it was only one couple but it's more than that - oh by the way, they're not contributing anything to 401K either since what they have barely covers house/car payments.
Posted by: Wes at January 18, 2006 10:29 AM
I am laughing at people who follow mass mentality and end up falling farther and farther behind. I took my $200,000 down payment and put it in the stock market last year and watch in grow on the 45% rise in stocks. I live in a comfortable townhome which I rent (i.e. no capital risk, when things break I call the landlord and he pays for it and I save about $4,000/month over paying a mortgage lenders retirement trust - called mortgage interest). If you need a $900,000 house you can't afford then good luck with the lawn furniture - it won't give you better friends or familiy members; just a ball and chain to the monthly check you send to your lender.
Posted by: LOL at January 19, 2006 09:06 PM
When I went to build my new house I "qualified" for a ridiculously high amount, so I went for something at almost half the original qualification. When I finally moved in, with my hand me down, garage sale furniture it looked dull & dirty in the new place. But the furniture itself was in pretty good shape. I just can't justify buying all new things when what I have works fine. That and I know this is not the place where I'll spend the rest of my life. Maybe just the next few years. Instead I bought slip covers. What I ended up with is a VERY comfortable place, where you can put your feet up.
Next door is a different story, two twenty somethings with brand new high line cars in the drive and a house full of RTG furniture. Not to mention the christmas presents were piled up to half the tree!! I can't imagine they pay cash for it all. Eventually it may all come crashing down on them.
Posted by: JoJo at February 14, 2006 02:24 PM