How are people affording these crazy home prices?

[Actual_Cryptid]

Research “pension spiking”, the City of Phoenix fire department was having major issues with it about 8 years back.

Pension spiking - Wikipedia

en.wikipedia.org

I guess it's a matter of calling cashed in vacation days "not working." Personally i think you have to be absolutely insane not to take your vacation days (and my union agreement has a rollover cap) but I also know the attitude that my parents had toward people taking vacations.

Damned if you take your vacation for being lazy and entitled, damned if you don't take the days and then cash em out in the end.

 

[BroncoAZ]

How can you be abusing a pension program if you are not breaking the rules? Seems to me they are working hard for their retirement and some of you all don’t like that lol. This goes back to one of the problems. People don’t like to see other people succeed and want a part of what they worked for.

There is doing what’s right and doing what’s legal, they are not always the same thing. People are entitled to what they signed up for, and many do contribute a small percentage (someone here mentioned 6%) of their income into a state pension system, I don’t think anyone is complaining about that. I would argue that many municipal pension programs were negotiated with the unions by power hungry politicians without consideration of the legacy costs on that community for decades to follow, but that’s a separate discussion.

Gaming the system by rolling over 20 years worth of PTO and sick days to cash out in the last three years, as well as working as much OT as possible in those last three years to double one’s salary “adjusts” the pension amount much higher than it would’ve been otherwise. Not illegal, but rubs many of us the wrong way. For this to work it must be systematic abuse with complicit management and policies. If done in the private sector, whatever, but in the public sector that additional burden falls squarely on the taxpayers (hello increased property taxes). Compound that extra money annually over 20-40 years and we’re talking millions of dollars potentially. An extra $25K for 25 years costs the taxpayer $650K, $40K for 40 years costs the taxpayer $1.64M, not to mention the opportunity cost over time on those funds.

Ever look at the property taxes on homes in places like NJ or CT with strong public unions? My buddy in NJ pays $10K per year on a $400K home, my family in CT pays $10K per year on a $350K home in shithole Middletown. My property taxes in AZ are $2600 on $465K.

 

[BroncoAZ]

I guess it's a matter of calling cashed in vacation days "not working." Personally i think you have to be absolutely insane not to take your vacation days (and my union agreement has a rollover cap) but I also know the attitude that my parents had toward people taking vacations.

Damned if you take your vacation for being lazy and entitled, damned if you don't take the days and then cash em out in the end.

I have 5 weeks PTO in my private sector job, and I take all of it annually. Your union with a rollover cap is a reasonable approach and I have zero issue with people taking all of their time. I have no issue with people stacking up 20 years worth of PTO and cashing it out at the end in a one time payment for an extra 1 year’s pay one time when they retire. I do take issue with stacking up decades worth of PTO and strategically dumping it in the pot for the last few years to increase pension compensation tens of thousands of $ for decades to come on the backs of the taxpayers.

 

[unclericco]

You guys got me curious on just how lucrative these pensions are. Making more on a pension than working doesn’t seem to add up..

Yeah agree. I will get what I would consider a pretty liberal pension but I won’t be making as much as I do now, even if you add in monthly SS checks? Most pensions I’ve ever heard of are like 50-70% of your highest 3 years

 

[jlh42581]

Besides the accounting reasons that companies introduce PTO rollover caps why exactly do you think they exist? Because people abused it! Catching any employer private or public with a "hey im gonna take the next six months off" has an impact on their coworkers and business projections as well that you can never plan for to hit you.

Also, dont fool yourself into thinking these people dont have time off. Quite the opposite, they have months off at a time. Some work schedules where they have a week or two off solid every month. When their wife wants to go to the beach theres no reason to dip into PTO, theyre already off.

 

[browning2480]

There is doing what’s right and doing what’s legal, they are not always the same thing. People are entitled to what they signed up for, and many do contribute a small percentage (someone here mentioned 6%) of their income into a state pension system, I don’t think anyone is complaining about that. I would argue that many municipal pension programs were negotiated with the unions by power hungry politicians without consideration of the legacy costs on that community for decades to follow, but that’s a separate discussion.

Gaming the system by rolling over 20 years worth of PTO and sick days to cash out in the last three years, as well as working as much OT as possible in those last three years to double one’s salary “adjusts” the pension amount much higher than it would’ve been otherwise. Not illegal, but rubs many of us the wrong way. For this to work it must be systematic abuse with complicit management and policies. If done in the private sector, whatever, but in the public sector that additional burden falls squarely on the taxpayers (hello increased property taxes). Compound that extra money annually over 20-40 years and we’re talking millions of dollars potentially. An extra $25K for 25 years costs the taxpayer $650K, $40K for 40 years costs the taxpayer $1.64M, not to mention the opportunity cost over time on those funds.

Ever look at the property taxes on homes in places like NJ or CT with strong public unions? My buddy in NJ pays $10K per year on a $400K home, my family in CT pays $10K per year on a $350K home in shithole Middletown. My property taxes in AZ are $2600 on $465K.

I completely understand what you are saying, but is it gaming the system if the system allows for it?

I also doubt the property taxes are that high just because people have high pensions. Maybe so, but I would guess there are other issues at play.

 

[excaliber]

Here in the Boise area the market is staying hot. There has been a plateau on home prices but as long as Ca. continues it's way there will be no shortage of Californians bringing their money and paying cash or buying homes sight unseen.

The market will correct. It always does but this is one of the areas that will rebound the fastest.

 

[CoStick]

I completely understand what you are saying, but is it gaming the system if the system allows for it?

I also doubt the property taxes are that high just because people have high pensions. Maybe so, but I would guess there are other issues at play.

The issue is when pensions no longer have the funding to pay as well. It certainly happens, Government pays and quite a bit less than originally planned for. I believe my Mom’s pension ended up at about 50% of what was projected when the government had to take over.

 

[browning2480]

That is the bad thing about pensions. They can be taken away if not managed appropriately. People pay in lots of money that they may never get back. I will take my money and manage it myself and keep all of it. Anything that is left when I am gone can then be passed down. Pensions don’t work like that and are a gamble that people don’t realize.

 

[Bobbyboe]

The Public worker unions get what they want. Whenever a public worker inc police and firemen wanted a raise, they got it. Now we have Firemen in our area making $120k their first year....and many making $200k a yr plus. Same for LEO's and Highway patrol. I know a couple of county sheriff deputies...not the Sheriff himself...that make $200k a year.

My neighbor retired from the FD at 52 on disability, [Ha, disabled] full lifetime medical with something like 80% of the avg of his last 3 yr salary. These guys pile on the OT and save vacation to bump that retirement up. He is probably making $160k a yr at 53. He runs the local 10k's, Jogs to the gym every morning- seems the Benadryl [or whatever] he was pounding to mess with his heart rate right before he retired is out of his system now.

Another guy I know through my BIL was a Fire chief in San Jose....retired on disability same deal, probably making $200k plus in retirement...and rode his bike across country with his wife after retiring. Its not just cops and firemen....A couple of our cities around here went bankrupt due to more civil service workers on disability...than on the actual payroll working. [now I'm going to have the cops and firemen ticked at me for ratting them out]

Your tax dollars hard at work. Its terrible and this loose spending will hurt the future generations.

This Biden infrastructure bill is more of the same social spending for salarys, health care, child care, all disguised as "Infrastructure"....build back betters hogwash and should be called , "Buy more votes"so they can stay in power.

>

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What city/state do you live in with those wages?

 

[Bobbyboe]

I contribute to a state pension. Here are the facts for the one I am in.

It is considered one of the top run/managed in the country. I contribute about 5-6% out of each paycheck. I can not roll over vacation. It is based off of the three highest earning years. Can retire at 50, but hit max payout at 53. Top payout is about 60-70% of my current income.

Not quite sure why people are butt hurt over fully funded pensions. The one I’m in has excess funds and is very healthy. The smart employees max out their deferred comp, in addition to the pension. Yes, I will retired and make more than I do at work. It’s not because of gaming the system, but rather because of hard work, investing, and planning.

 

[wind gypsy]

I contribute to a state pension. Here are the facts for the one I am in.

It is considered one of the top run/managed in the country. I contribute about 5-6% out of each paycheck. I can not roll over vacation. It is based off of the three highest earning years. Can retire at 50, but hit max payout at 53. Top payout is about 60-70% of my current income.

Not quite sure why people are butt hurt over fully funded pensions. The one I’m in has excess funds and is very healthy. The smart employees max out their deferred comp, in addition to the pension. Yes, I will retired and make more than I do at work. It’s not because of gaming the system, but rather because of hard work, investing, and planning.

I think most of the negative sentiment here is towards those who play the system knowing full well they are taking more than the system can support and ultimately the ones who come after them that are funding their inflated pension or the tax payer are the ones hurt. I'm not sure I can blame anyone for taking everything they can but more so the ones who created a system that is destined to fail.

 

[MattB]

How can you be abusing a pension program if you are not breaking the rules? Seems to me they are working hard for their retirement and some of you all don’t like that lol. This goes back to one of the problems. People don’t like to see other people succeed and want a part of what they worked for.

When the union holds public safety over the community’s head to set rules that enrich a few but ultimately screw their successors - and it was predictable that would ultimately happen, it isn’t about people not wanting other to succeed.

 

[Actual_Cryptid]

Lets take a minute to give it up for the "I'm not a doctor and I haven't seen this person's medical records and I didn't examine them myself so because they're not hobbling around on a walker I will presume they're not really disabled at all."

None of the words I have for that line of thought are positive, but hey I run every morning so I must be a faker too. All that cumulative joint damage, backpain, exposure-derived asthma, PTSD, arthritis, and sleep disorder are all otherwise normal for a 28 year old.

Although if we want to talk about screwing over the taxbase we could direct some attention at TIFs and the way that companies so often get a 0% effective tax rate, and the effect that tax advantage has on small business competitors. Or the way certain large corporations spend money loads of money to stifle union organizing and leverage public assistance programs rather than paying wages to employees, and the effects that has on both the taxbase and market competition.

But no, the real villain is that guy who collects a disability payment and doesn't look disabled enough!

 

[bozeman]

total derailment! back on topic.........house prices are insane!!

 

[Customweld]

total derailment! back on topic.........house prices are insane!!

House prices are insane! I have been cruising Zillow around Idaho and am starting to see price reductions on quite a few listings. Granted these listings are away from any of the urban areas. My middle daughter is in the process of buying her first house. She is a 2nd year electrician apprentice and does ok for a 20 year old kid. She still lives at home , which is fine for me because she is a good housesitter when my wife and I are gone. She has been saving up for a down payment and has a pretty decent little sum. She is wanting to get into a duplex and live in one side and rent out the other. The one she has an offer on, rent in the other unit will damn near cover her payment.

 

[540-Virginian]

Late to the game but my theory is once covid subsides or at least once normalcy returns to city and office life, all those people who thought they wanted to live in rural towns and getaway destinatjons will realize they don't actually like it and the upkeep on house is too much or they want money to buy a house in the city again.

Businesses are going to require people go back into the office. Sure hybrid work exists but you'll have to go to an office. So all those people thinking they can work remote forever will move back to where jobs are - cities.

When people are fearful be greedy. When people are greedy be fearful. Ive taken that approach with cars and house and certain investments and gotten lucky. Right now I wouldn't buy anything unless you have to. Covid and this government is a huge variable to traditional trends and people are being greedy with everything these days.

Its a weird ‘sit on the shitter reading’ interest i have that im addicted to craigslist. I dont but stuff that often but i love seeing what peiple arw selling. It actually tells alot about out people. Right now there is a shitload of photography stuff selling. A few months ago it was exercise equipment. Pretty soon it will be camping and campers, especially with kids back in school is my prediction.

but houses and land and cars and bikes are still overpriced and few and far between.

 

[tdhanses]

House prices are insane! I have been cruising Zillow around Idaho and am starting to see price reductions on quite a few listings. Granted these listings are away from any of the urban areas. My middle daughter is in the process of buying her first house. She is a 2nd year electrician apprentice and does ok for a 20 year old kid. She still lives at home , which is fine for me because she is a good housesitter when my wife and I are gone. She has been saving up for a down payment and has a pretty decent little sum. She is wanting to get into a duplex and live in one side and rent out the other. The one she has an offer on, rent in the other unit will damn near cover her payment.

Thats good because it covers her when the government allows people to not pay rent and still live in the rental, she’ll be able to make the payment and keep the place.

 

[Poser]

Late to the game but my theory is once covid subsides or at least once normalcy returns to city and office life, all those people who thought they wanted to live in rural towns and getaway destinatjons will realize they don't actually like it and the upkeep on house is too much or they want money to buy a house in the city again.

Businesses are going to require people go back into the office. Sure hybrid work exists but you'll have to go to an office. So all those people thinking they can work remote forever will move back to where jobs are - cities.

When people are fearful be greedy. When people are greedy be fearful. Ive taken that approach with cars and house and certain investments and gotten lucky. Right now I wouldn't buy anything unless you have to. Covid and this government is a huge variable to traditional trends and people are being greedy with everything these days.

Its a weird ‘sit on the shitter reading’ interest i have that im addicted to craigslist. I dont but stuff that often but i love seeing what peiple arw selling. It actually tells alot about out people. Right now there is a shitload of photography stuff selling. A few months ago it was exercise equipment. Pretty soon it will be camping and campers, especially with kids back in school is my prediction.

but houses and land and cars and bikes are still overpriced and few and far between.

There will be no returning to “normal” or regular office life. This is the model that will be used going forward and the school aged kids will be super adapted to it. A significant chunk of the jobs that will exist 20 years from now do not even exist in concept yet. A significant chunk of present day jobs will be replaced by robots and AI. There is no going back to “normal”

 

[Savage99]

Couple things.

don't bitch about the house prices In The area you live in or have grown up in and now can’t afford, after all, if the local population wouldn’t sell for profit you all wouldn’t be priced out.

half you keyboard warriors are waiting for the in-laws to keel over so you can capitalize on the fruits of there labor.

I bought my house on 23 an hour at the age of 25 in 2013 for 283k in Southern California! I was ******* broke, flat the **** broke. Had 300 hundred dollars to my name andnitwith a 2k mortgage. I saved for 5 years paying 1550 a month for an apartment untill I had 15k in the bank

If I decide to sell my house and move out of state, I’m gonna do it with a smile on my face knowing I paid cash for a house in a great community and a better life. Iv busted my ass to get to where I am currently at and not a soul can hold that over my head

iv read 9 pages of great knowledge and information but for the guys that are bitching about everything being to expensive, life is about choices, kids are expensive probably should have pulled out.

No one wants to be house broke, but your mortgage won’t change dramatically over the years so as you own you home and your wages go up, new job, promotion whatever, your mortgage stays the same. Ask the dudes that payed 80k for a house In The 60’s on 2 bucks an hour if it was cheap…0

Has the wage you made as a 25 yo gone up much?


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