Upside Down House-Car Ratio

[Amethyst]

The townhouse development where we have our rental unit, has 3 sections, each about 50 units. We own in the cheapest section, where values run $250-$290K (in our region, that's a middle class townhouse). None of the units in our section have garages; instead, they form a square around a parking lot, so we see what all the residents drive. Frankly, our older, inexpensive little car sticks out like a sore thumb. Last week, when we spent a lot of time working on the townhouse, I counted:

• Two newer BMW 7-series sedans

• 3 smaller Beemers (3 and 5 series)

• 4 Mercedes Benz sedans: 3 mid-range, one very large

• Cadillac Escalade SUV

• Late model Corvette
• Not to mention newer Infinitis and Acuras, which cost close to $40K.
• Yes there are middle-class cars and SUVs too: Hondas, Toyotas, Hyundais.

Does it seem odd to anybody else that people in middle to lower-end housing would own so many high-end cars? Cars which are not only expensive to buy, but costly to own. Why don't they save their car dollars, move to a house with a garage, and then buy a swanky car? OK I'm sorry, that was a judgmental question. But...

I suppose some will joke about drug dealers, etc. but the neighborhood does not give off that vibe at all. During the day most owners seem to be away at work [I did my car census on the weekend], and we don't see what you'd call "shady" characters hanging around or going in and out. The few residents we've met seem normal, and our tenants haven't reported anything out of the ordinary (yet).

Amethyst

 

[cantlogin]

...Does it seem odd to anybody else that people in middle to lower-end housing would own so many high-end cars? Cars which are not only expensive to buy, but costly to own...

Amethyst

"Odd is an adjective denoting the quality of being unpaired, occasional, strange or unusual"

Unfortunately it doesn't seem odd. I have observed that the situation you describe is ordinary for ordinary people trying to prove that they are not ordinary.

I don't know you Amethyst but I have been a long time lurker and sometimes poster on this forum. Sooner or later you are going to have to realize and admit that you are more than a little bit smarter than the ordinary "Conspicuous Consumer".

 

[playaman]

If I can recall college psychology correctly (it's only been 40 years!), what you're describing is known as "compensatory consumption" -- where folks who can't afford much splurge on high-prestige items they hope to be associated with. A common example is a ghetto street - rundown houses, high crime, the whole thing - populated with luxury cars. May not be what you're describing but certainly elements are present.

 

[Koolau]

I'm still surprised by the conspicuous consumption of those who must borrow (or otherwise skimp on the basics). While I still like nice cars (etc.) I've found that few "things" bring happiness. Freedom from debt plus manageable expenses make me much more happy than having nice wheels waiting in the parking lot. Just my thing, I suppose. YMMV

 

[JPatrick]

Two newer BMW 7-series sedans

• 3 smaller Beemers (3 and 5 series)

• 4 Mercedes Benz sedans: 3 mid-range, one very large

• Cadillac Escalade SUV

• Late model Corvette
• Not to mention newer Infinitis and Acuras, which cost close to $40K.
• Yes there are middle-class cars and SUVs too: Hondas, Toyotas, Hyundais.

Amethyst

You noted upper class cars (beemers etc) and middle class cars (Hyundais).
I've afraid to ask, but where does that leave my Chevy, Dodge, and Wrangler?

But on to your point. With easy leases, and easy terms to buy, cars are one of the "easiest" big things to obtain to show you have arrived.

I've noticed that many car dealers here only mention price in the form of a daily cost. Just $18 bucks a day for a new whatever! Sounds easy until you multiply $18 times 30.. and heaven forbid, don't look at the interest costs.

 

[W2R]

Does it seem odd to anybody else that people in middle to lower-end housing would own so many high-end cars?

Maybe the payments on those expensive cars are preventing them from qualifying for enough of a mortgage to afford high end housing?

Alternately, maybe their circumstances have improved, but they can't sell and move up due to the housing market? But wait, it seems to me that maybe you mentioned that your area is only lightly affected by the housing crisis. Or maybe I imagined that... CRS here.

 

[jerome len]

I have a 250k condo and a Cadillac Escalade! why? the condo is all that I need, I have money in the bank, paid cash for both and enjoy both.

Everybody has different priorities......that's the great news about living in the good old USA!

 

[W2R]

I have a 250k condo and a Cadillac Escalade! why? the condo is all that I need, I have money in the bank, paid cash for both and enjoy both.

Everybody has different priorities......that's the great news about living in the good old USA!

Good point, Jerome Len! That is so true - - everybody does have their own priorities and maybe they are just being honest with themselves about what their real priorities are. If so, kudos to them for having enough self-knowledge to realize that.

 

[lemming]

When my car was stolen a couple of years ago I went to the neighbors(mostly to make sure they had not had it towed if I had parked in wrong spot._) He couldn't believe someone would steal my car not his since his was a much better car.
He might be right but that's the last thing I would worry about when hearing about a car theft outside my door.

 

[ohyes]

A couple decades ago, a good friend of mine had a brother who (finally) landed a job.... selling seafood/steaks door-to-door. She told me that, in the training, they told him to look for mid-level or lower housing, with very nice cars. That those were the folks with whom they would make the most sales. I found that so interesting.

Obviously, a huge generalization...still interesting. With a so-so house and an Impala, we have had none of those salesfolks.

 

[haha]

Just give them all copies of The Millionaire Next Door. They will love you forever.

Ha

 

[glippy]

My tenants drive nicer cars than I do too.

I figure it's just one more reason why I'm the landlord and they're the tenants.

 

[NW-Bound]

One of my neighbors keeps his and her cars for only 3 years. Since they moved in next door about 15 years ago, they have had so many new cars that I lost count. Theirs are not fancy, but new cars every 3 years still cost some bucks. I found out that the husband hates working on cars, or has them breaking down. So, he rather keeps trading them in before there is a chance of problems.

Different strokes for different folks, all right. Meanwhile, I am still doing maintenance on my vehicles. The other day, my old minivan suddenly ran a bit rough. Well, truth be told, it was so rough I was glad I was only 2 miles from home. At 160,000 miles, I thought it was about time to send it to the junk heap.

But, but, but I've got to know what the problem was, right? So, I opened up all the spark plugs, and looked at them. Darn platinum plugs I put in new at 100,000 miles ago still looked pretty good, but the gaps had widened quite a bit. Can't say they don't make spark plugs like they used to, as most of my other cars got hit and totaled before they could die of such old age for me to know if spark plugs would last that long.

So, I regapped the plugs, and put them back in. Still ran rough. The next thing of course was to disconnect the plug wires, one at a time, to see which of the 6 cylinders was not working. Found it, the center cylinder of the front bank (facing the front).

So, let's disconnect its fuel injector connector, stick an ohmmeter lead down its terminal to see... Ah hah, open circuit! A check on the adjacent fuel injector showed 13 ohms. Bingo!

About $35 and 4 days later, a package arrived from an eBay seller, containing a replacement fuel injector. Took 30 min to replace it. Ran like [-]new[/-] it did just before the mishap.

Darn, I guess my fate is to have to drive this old clunker for a while more.

Had the bad fuel injector happened to be in the back row of this V6 engine, I would not be able to stick my ohmmeter back there to check the injector, leave alone to replace it. The whole intake manifold would have to come off, and the car and I are both a bit too old for that to happen.

 

[Amethyst]

I agree, "class" and "higher/lower end" are loaded terms, and like all loaded terms, can come back to haunt a person. Sorry if I offended anyone. "Expensive" and "less expensive" is probably the safest way to put things. Except when it comes to housing, "less expensive" for our area might be "upscale" in some places, and "bare minimum" in others

I would think of your vehicles (even w/o knowing make, model etc.) as practical, useful, great value for money. Personally I think of our car (2005 econobox with, as they say, "cosmetic flaws") as a "robber repeller" but we spend the $ to keep it in good order.

We - especially Mr. A. - love fine cars, though we've never owned one. He always looks longingly at that Corvette. But he shudders at its living in a parking lot, especially during snow plowing season.

You noted upper class cars (beemers etc) and middle class cars (Hyundais).
I've afraid to ask, but where does that leave my Chevy, Dodge, and Wrangler?

But on to your point. With easy leases, and easy terms to buy, cars are one of the "easiest" big things to obtain to show you have arrived.

Do leases cover maintenance, too? If that's the case, you've surely hit the nail on the head. In that case, the residents are smart, having lower maintenance costs for both their homes and their cars.

Amethyst

 

[Amethyst]

Mr. Ha, I knew I could count on you for the best way to introduce oneself to the neighbors!

Just give them all copies of The Millionaire Next Door. They will love you forever.

Ha

 

[donheff]

The other day, my old minivan suddenly ran a bit rough. Well, truth be told, it was so rough I was glad I was only 2 miles from home. At 160,000 miles, I thought it was about time to send it to the junk heap.

But, but, but I've got to know what the problem was, right? So, I opened up all the spark plugs, and looked at them. Darn platinum plugs I put in new at 100,000 miles ago still looked pretty good, but the gaps had widened quite a bit. Can't say they don't make spark plugs like they used to, as most of my other cars got hit and totaled before they could die of such old age for me to know if spark plugs would last that long.

So, I regapped the plugs, and put them back in. Still ran rough. The next thing of course was to disconnect the plug wires, one at a time, to see which of the 6 cylinders was not working. Found it, the center cylinder of the front bank (facing the front).

So, let's disconnect its fuel injector connector, stick an ohmmeter lead down its terminal to see... Ah hah, open circuit! A check on the adjacent fuel injector showed 13 ohms. Bingo!

About $35 and 4 days later, a package arrived from an eBay seller, containing a replacement fuel injector. Took 30 min to replace it. Ran like [-]new[/-] it did just before the mishap.

Darn, I guess my fate is to have to drive this old clunker for a while more.

Had the bad fuel injector happened to be in the back row of this V6 engine, I would not be able to stick my ohmmeter back there to check the injector, leave alone to replace it. The whole intake manifold would have to come off, and the car and I are both a bit too old for that to happen.

Interesting. I used to do light car repairs - tune ups, R&R alternators, rebuilt a couple of VW carburetors, etc., and I could puzzle my way through a troubleshooting process like that. I got out of doing it about thirty years ago and figured that modern cars were probably just too complicated to tackle. But you actually make it sound doable. I have been going through a fun/humorous experience re-learning basic bike mechanics with a lot of advice from an online forum. Maybe I will tackle my car next time.... No, on second thought I think I will live vicariously on car repairs. I want my car to start.

 

[Amethyst]

I love your post! You knew what you wanted, and went after it both responsibly and successfully. Don't get me wrong, we think the neighbors' Escalade and other fancy cars are beautiful.

(But do you keep your big beauty outdoors?)

A.

I have a 250k condo and a Cadillac Escalade! why? the condo is all that I need, I have money in the bank, paid cash for both and enjoy both.

Everybody has different priorities......that's the great news about living in the good old USA!

 

[Amethyst]

W2R, what is CRS?

I would say employment has been only lightly hit by the recession, due to the high amount of Government employment, contracting, etc. However, the housing market seems to have a mind of its own. Prices are down quite a bit from their peak, though they are still a bit above 10 years ago (last time I checked, anyway).

Amethyst

But wait, it seems to me that maybe you mentioned that your area is only lightly affected by the housing crisis. Or maybe I imagined that... CRS here.

 

[REWahoo]

W2R, what is CRS?

She won't be up for hours.

CRS = Can't Remember Sh!t

 

[Amethyst]

Now I am convinced that the neighbors have probably thought things through and decided to lease:

Lease vs Buy? Car Leasing versus Buying Explained

Perhaps it isn't what we'd do, but it's not at all impractical.

Happy Thanksgiving,

Amethyst

 

[W2R]

W2R, what is CRS?

She won't be up for hours.

CRS = Can't Remember Sh!t

He's got it right, although I would have said something like "Can't Remember Stuff" just to be a little more genteel. I did get up a little earlier, at 9 AM this morning.

I would say employment has been only lightly hit by the recession, due to the high amount of Government employment, contracting, etc. However, the housing market seems to have a mind of its own. Prices are down quite a bit from their peak, though they are still a bit above 10 years ago (last time I checked, anyway).

Amethyst

Oh, ok - - I didn't remember that correctly. Oops. Seems like the older I get, the harder it is to keep things straight sometimes.

 

[haha]

I agree, "class" and "higher/lower end" are loaded terms, and like all loaded terms, can come back to haunt a person. Sorry if I offended anyone. "Expensive" and "less expensive" is probably the safest way to put things.

It's part of our shared American fantasy that class is not noticed, or important. What a crock. It has profound implications in almost every area of life. Even in the UK, where health care is free and most use the NHS, being in a higher socioeconomic class counts in one's health status. And get this one. Say you are upper middle class, but for some reason or another your neighbors are of lower classes. Then your health status will often be lower than your UMC confreres who live in UMC neighborhoods.

Anyone who isn't convinced, go to some speed-dating events. First represent yourself as a doctor. Then go as a call center worker. Compare how many of your speed-partners want to see you again under each condition.

 

[JPatrick]

He's got it right, although I would have said something like "Can't Remember Stuff" just to be a little more genteel. I.

Well yeah, you know how REW is, just can't take him anywhere....

 

[REWahoo]

Well yeah, you know how REW is, just can't take him anywhere....

No shirt...

 

[W2R]

That's OK, we like him anyway, don't we?