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How would you even know? People won't be telling you they're overstretching themselves. Or they've got huge credit card bills. Or got a ton of loans. The other

How would you even know? People won't be telling you they're overstretching themselves. Or they've got huge credit card bills. Or got a ton of loans. The other thing that's avoiding forcing these sort of problems into the light is low interest rates and a lack of a housing market bubble pop. In the UK they've used all sorts of tricks to make sure the housing market doesn't pop. If those change, that brings out all the people who over-stretched themselves on things they couldn't really afford. But it seems to be general policy around the world to penalize savers and reward spenders. That's good for growth, but could potentially cause some serious problems.

luckylion 6y ago
Good point about not knowing in general. I believe I know my friends well enough (and long enough) to be certain that they aren't constructing elaborate webs of lies to fool me, so their rising wealth is likely real - as I said, it's hard not to put money aside when you live a middle class live on a higher income. None of those I was talking about own property though, while many of those with children do. I wouldn't put a house into the category I understood the parent comment to talk about: it's not consumption, it's an investment. Still, you're right that it's something you're committed to and that would make it hard to "just walk away" from a job. Savers get punished, but so do those that buy insurance, until the day they need it, I suppose.
- lotsofpulp 6y ago
  How is the biggest purchase of someone’s life not consumption? It’s can be both, although, I would argue the investment aspect of a house is minor and irrelevant since you always need somewhere to live. The mortgage debt has to be serviced, and your kids have to go to the schools in the richest areas (aka best schools). Hence once you have kids, most are innately pushed to stretch themselves so their children have access to the best possible future.
- ZephyrBlu 6y ago
  > I wouldn't put a house into the category I understood the parent comment to talk about: it's not consumption, it's an investment A house is a terrible investment. I don't understand why people are so obsessed with them. The only reason I can think of is that there's something very human about your house being yours.
  - cpach 6y ago
    In some markets, finding an appropriate rental at a good price is nearly impossible. So instead of renting, people get a mortgage. Which can be a very reasonable decision as long as the mortgage isn’t a crazily high multiple of your yearly income.
  - mattmanser 6y ago
    Here in the UK, any one who said this any time in the last 20 years now looks a complete fool. Including me. I said this 20 years ago, I said this 15 years ago. But house prices just went up and up and up. Houses you could buy for 20k are now worth 160-200.

luckylion 6y ago

Good point about not knowing in general. I believe I know my friends well enough (and long enough) to be certain that they aren't constructing elaborate webs of lies to fool me, so their rising wealth is likely real - as I said, it's hard not to put money aside when you live a middle class live on a higher income. None of those I was talking about own property though, while many of those with children do. I wouldn't put a house into the category I understood the parent comment to talk about: it's not consumption, it's an investment. Still, you're right that it's something you're committed to and that would make it hard to "just walk away" from a job. Savers get punished, but so do those that buy insurance, until the day they need it, I suppose.

lotsofpulp 6y ago
How is the biggest purchase of someone’s life not consumption? It’s can be both, although, I would argue the investment aspect of a house is minor and irrelevant since you always need somewhere to live. The mortgage debt has to be serviced, and your kids have to go to the schools in the richest areas (aka best schools). Hence once you have kids, most are innately pushed to stretch themselves so their children have access to the best possible future.
ZephyrBlu 6y ago
> I wouldn't put a house into the category I understood the parent comment to talk about: it's not consumption, it's an investment A house is a terrible investment. I don't understand why people are so obsessed with them. The only reason I can think of is that there's something very human about your house being yours.
- cpach 6y ago
  In some markets, finding an appropriate rental at a good price is nearly impossible. So instead of renting, people get a mortgage. Which can be a very reasonable decision as long as the mortgage isn’t a crazily high multiple of your yearly income.
- mattmanser 6y ago
  Here in the UK, any one who said this any time in the last 20 years now looks a complete fool. Including me. I said this 20 years ago, I said this 15 years ago. But house prices just went up and up and up. Houses you could buy for 20k are now worth 160-200.