I work in an office where about half the people own homes and the other half are freaking out about how they will ever afford a home in the Bay Area. CW 1 bought a house in an amazing town with great schools in the pre-recession bubble. Just by sheer luck of timing, I bought mine after. We have very different views of home ownership and I've been trying to convince him for years that he's not in as bad of shape as he thinks he's in. After all, he at least partially owns a home that is now increasing in value again. Then comes the following, as we're talking to CW2 who is excited about closing on a house in my town (she owned in her previous town and likes the idea). CW3 is the one who is freaking and will probably not buy until this bubble bursts.
CW2- We're closing this week. I'm so thrilled!
CW1- Welcome to the nightmare.
Me- Come on, dude, you own a beautiful home in a beautiful town with fantastic schools. You weathered the recession. What's the problem?
CW3- Yeah, I'll never own my own home if values keep rising like this.
CW1- Well, I don't really own the home.
Me- You have equity, man. Just look at housing values now. They have recovered and you're in a good position if you want to sell and move to more affordable town.
CW2- I don't have any equity.
Me and CW2 and 3- Huh? You bought your house 10 years ago? You have to have equity.
CW1- No, we're barely hanging on. We bought when you had to take an interest only loan.
Me- What?!!! You HAD to take an interest only loan?
CW1- We couldn't afford it otherwise.
Turns out they paid ONLY interest for 7 YEARS. OMG!!!??? No wonder he's bitter. I didn't say it, but obviously he just couldn't afford a home. I lost a whole lot of respect for the guy when he claimed he "had to" do it. Do I feel fortunate that I have a cheaper home? Yes, but I also bought what I could afford in a crappier town.