Real Estate Barbie:
Hi, Barbie. I’m Real Estate Barbie. Thank you for coming today to see our Malibu two bedroom Barbie Dreamhouse. This model first came to market in 2021, so it’s one of our newest constructions.
Yoga Barbie:
It has that fresh out of the box smell. I love it. And I love how the first floor is open concept. The pool is just inches away from the kitchen.
Real Estate Barbie:
That’s right. Unlike the Barbie pools back in the 70s, this pool has some real three dimensional depth.
Yoga Barbie:
Oh, are those real plastic countertops?
Real Estate Barbie:
That’s right. The whole kitchen has these luxury plastic finishes. Oh, and the appliances will be included. The oven even opens.
Yoga Barbie:
I remember that everything was cardboard in my grandma’s dream house back in the 60s. Made cooking a real fire hazard.
Real Estate Barbie:
But there is something to say about affordability in the housing market back then. The average house in 1960 would’ve cost you $11,900. That is, of course, not accounting for inflation. Now, if you walk this way, we can take the elevator to the bathroom and then we can see the master bedroom.
Yoga Barbie:
Oh, the bedroom has bunk beds. How sweet.
Real Estate Barbie:
The current owner is such a fun but hardworking woman. She’s an astronaut/pop star.
Yoga Barbie:
Wow. Good for her. Did you know that in the US the participation rate of women in the labor force has increased to 56.9%? Back in the 50s, it was only 34%.
Real Estate Barbie:
And yet, on average, women still only make about 75 cents for every dollar their male counterparts make. It makes it really difficult for some women to afford the lifestyles they dream of.
Yoga Barbie:
Speaking of, I love everything about this house, but what’s the asking price?
Real Estate Barbie:
This one has an asking price of $4.5 million.
Yoga Barbie:
$4.5 million seems like a lot.
Real Estate Barbie:
I know real estate prices have skyrocketed in California. Back in ’92, a house the size would’ve cost you approximately $1.67 million. In the late 80s, I sold a very similar single family home for just over $670,000.
Yoga Barbie:
Well, this really is the dream house for me, but I don’t think it’s in my price range.
Real Estate Barbie:
Okay. Let’s look somewhere else then. After all, California’s cost of living is 186% higher than the national average. Housing prices here are 630% higher than in most of the country.
Yoga Barbie:
Whoa. Maybe we should fly to New York then.
Real Estate Barbie:
This is our two story New York townhouse. It’s foldable, so it’s perfect for those tight NYC spaces. You’ll also see kitchens like this one. It’s compact. It does have plastic appliances, the fridge, the stove, the oven, but the countertops are painted right into the walls.
Yoga Barbie:
What a real space saver. How much did you say this house is?
Real Estate Barbie:
Well, the average asking price for townhouses in this area is $928,000. I know this is technically a one bedroom, but look at the size of this tub. You can practically live in it.
Yoga Barbie:
I think it’s still a little out of my price range.
Real Estate Barbie:
I totally understand, Barbie. Maybe we should be looking for something better suited to your current salary. How much do you make?
Yoga Barbie:
Well, I’m a yoga instructor, but I’m just getting started, so I make about $74,000 a year.
Real Estate Barbie:
Well, that’s a decent salary, especially considering that in the 90s, self-employed female fitness instructors made an average of less than $20,000 a year.
Yoga Barbie:
Wow. That’s nothing.
Real Estate Barbie:
But for this house, even with a 20% down payment, you’d need to pay approximately $4,500 a month with a 25-year amortization period. And just so you know, Brooklyn Barbie is interested in making an offer.
Yoga Barbie:
What does she do?
Real Estate Barbie:
Well, she’s a very successful dentist and makes over $180,000 a year so she can afford the monthly payments.
Yoga Barbie:
Let’s see. Thinking about my income, I make just over $6,100 a month. So to make those monthly payments of $4,500, I’d need to spend nearly 73% of my monthly income.
Real Estate Barbie:
Okay, so that doesn’t sound realistic. And being honest, it’s unlikely you’d ever be approved for a loan for this home unless you had a co-signer.
Ken:
Hi, I’m Ken. A horse veterinarian.
Yoga Barbie:
Yeah, I don’t think that’s going to work out. Do you have anything I could afford?
Real Estate Barbie:
Well, let’s talk about your price range. You said you make approximately $6,100 a month, right?
Yoga Barbie:
That’s right.
Real Estate Barbie:
And how about your credit? How’s that doing?
Yoga Barbie:
It’s around 680.
Real Estate Barbie:
Well, that’s good. That means you always pay your bills on time. But how about your spending?
Yoga Barbie:
I love shopping and traveling.
Real Estate Barbie:
Me too. But if you have a lot of credit card debt, it’s going to significantly impact the size of loan you will be approved for.
Yoga Barbie:
I understand. But what if I limit my spending and pay off my credit card debt?
Real Estate Barbie:
That will definitely help. As far as mortgage goes, the general rule says that you shouldn’t spend more than 30% of your monthly gross income on housing.
Yoga Barbie:
For me, that’s about $1,800.
Real Estate Barbie:
Right. Reverse engineering that, if you make monthly payments with a 5.39% interest rate in a 25-year amortization period, you could probably afford something around $300,000.
Yoga Barbie:
Is that even doable in a big city like New York?
Real Estate Barbie:
It’s tricky, but I could probably find you a really cute studio apartment in Brooklyn. Maybe a one bedroom if we’re lucky.
Yoga Barbie:
Oh, that’s a significant step down from the dream home. I don’t know about a condo though. I’ll be dealing with condo or maintenance fees forever even after I pay off my mortgage. I want more freedom.
Real Estate Barbie:
Well, you said you love to travel, right?
Yoga Barbie:
It’s perfect. I’ll take it. Nomadic yoga life, here I come. Beep beep.
