10 ms·

66% of renters say homeownership is ‘hopeless’

114 points by donsupreme 3y ago

desro 3y ago
I'm an early-90's "millennial" in one of the ten biggest cities in the United States and am unfortunately in a position where I couldn't even afford to move. It's not so much "the economy's" fault as it is my [yearslong] attachment to a company where there's been no wage growth (hopefully I'm out by September!). Altogether very much not what I ever thought "30"+ would look like for me.
- anononaut 3y ago
  Don't be too discouraged. Not a soul correctly guesses what their 30s are like. Just keep making good moves.
- imbnwa 3y ago
  Worst part is moving to smaller places is usually less culture but moving to bigger places is more expensive
noahtallen 3y ago
Definitely agree with this sentiment! Houses are affordable only in low cost of living areas where folks don’t want to live for a reason. Some of those reasons are subjective (not a lot to do in Ohio), and some are very objective (certain rural areas are extremely hostile to other groups of people). In major cities where people want to live (slash where well paying jobs are), it is very difficult to justify ownership. For example, a $600k house at 7% interest will loose money over 5 years even if you sell for $650k. And not just loose money, but loose even more money than renting for like $4k/mo. (And this accounts for a $100k down payment!) There is basically no way to justify ownership in these areas financially without coming into a significant amount of capital. And while you could afford it with a high cashflow (two high income earners, which is doable in major cities), you can get a nice apartment for $4k/mo that might have even more amenities than your house would have (like a hot tub). I think this is a huge bummer, especially because owning an apartment or condo is becoming more rare as well, since renting is more financially attractive to property owners. This basically makes it much more difficult to build wealth, and allows large developers to make off with a huge amount of money. So it does feel kind of hopeless in these large cities, even if you make a ton of money. You basically either have to accept taking a huge loss on ownership (unless you stay there for decades or get a great deal), or settle for renting.
- coding123 3y ago
  And at 4k a month for rent I would say life is just hopeless which might account for the mass shootings, suicide, homelessness, drug use...
- wara23arish 3y ago
  If you’re comparing it to renting you still come out on top no matter
  - noahtallen 3y ago
    The numbers I shared in my post are from some basic math! Over 5 years, you spend more money, even if it appreciates by 5% when you sell it. This is because $170k of your mortgage payments went to interest alone, not to mention HOA fees, property tax, mortgage insurance, and maintenance. Unless the house appreciates a lot very fast, or you have very low interest rates, it’s very unlikely that a house in these cities ($650k, for example) will make you money at all in the mid-term, let alone beat renting.
  - carbine 3y ago
    that's just mathematically incorrect as a generalization. it depends on the market, the price-to-rent ratio, interest rates, transaction fees, maintenance fees, taxes, and how long you're actually living in one place. if your burn as a renter is substantially lower you could invest the difference in a non-real-estate asset and make a lot more return, in many cases.
    - Sohcahtoa82 3y ago
      There are a lot of factors, but if you don't move, then I can't see any realistic scenario where renting comes out ahead in the long term. In my area, the price-to-rent ratio is nearly 1:1. When I bought my house in 2015, my mortgage payment (30 year fixed) was about $1,500/month (Plus ~$400/month property tax). Zillow estimated the rental value at $1,700/month. From the listings I've seen in my area, Zillow's rental value is pretty close to what people are paying. In my case, I would have been insane to choose to rent instead of buy. The thing to remember is that rent always goes up. 30 years from now, the rent could easily be anywhere from $4,000-7,000/month. Meanwhile I'll be making my final $1,500 mortgage payment. Yeah, if my water heater explodes, I'm on the hook for it. But a single month of savings in the difference between renting and buying years from now would cover the cost.
timcavel 3y ago
USA brand tax objects must deploy hypersonic nuclear drone bombers to ruthlessly enforce absolute maximum economic compliance immediately!!!
TrackerFF 3y ago
I moved out to the rural countryside, paid $120k for my house. Work remote, and meet my collogues 5-6 times a year in person. It's not for everyone, but I'm happy. Not being a slave to the bank (mortgage) feels incredible.
- ihateyouall123 3y ago
  But why do you censor yourself?
- zenger 3y ago
  Do you mind if I ask what state/region ?
- elforce002 3y ago
  Congratulations. That seems like a peaceful life right there. Enjoy it.
- hanoz 3y ago
  I seriously doubt there's a $120k countryside house within 500 miles of me.
  - mokarma 3y ago
    Challenge accepted. Share your general area / zip code.
    - coding123 3y ago
      I'm looking for 100 acres with a new construction house that can't hear the road for about 400k, any takers? This was possible 10 years ago.lol we all missed out
    - red-iron-pine 3y ago
      ooooo oooo do me. Northern VA: 22030 I've got 3 kids, so no bungalows, and nothing that's in the ghetto, cuz SE DC almost certainly has cheap real estate -- and the highest murder rates in the US.
hanoz 3y ago
Western leaders had better start coming up with radical solutions to housing market driven inequity or there'll be ructions.
- paxys 3y ago
  There is a single solution for this – build more housing. Yet that option still remains unpopular, even among people who cannot afford housing. Blaming leaders is pointless. Instead organize and convince your neighborhood NIMBYs to change their minds.
  - hanoz 3y ago
    "Just build more houses", yet alone when framed as "it's up to you to convince your neighbors to let you to build more houses" just doesn't cut the mustard any more. We need serious changes that are actually going to make a difference, along the lines of (for residential property): * Outlawing mortgages for non occupiers. * Sharing of capital gains with tenants. * A complete end to no fault evictions. * Universal right to buy for tenants. * Putative tax for rental income.
    - mrep 3y ago
      That would basically kill the entire rental market and force everyone who wants to move to a new place buy a place instead of having the option to rent which would make changing jobs super painful. I moved across the country after college for a job and my brother has done that like 5 times changing jobs. Buying and selling a place is a huge pain and has an extremely high transaction cost compared to renting.
      - sokoloff 3y ago
        Many people seem eager to screw over tens of millions of renters if it means they think they’d get a better chance to buy a place.
        deleted 3y ago
lamp987 3y ago
In the future, only investment firms will own homes and everybody will be renting their whole life. At the end of their lives, they will have no inheritance to pass on to their children. You will own nothing.
- pphysch 3y ago
  Yep, corporate feudalism. But feudalism tends to end in (violent) land reform.
  - em-bee 3y ago
    not feudalism, because these corporations can be well regulated and renters rights protected by law.
    - FractalHQ 3y ago
      Not if the corporations write the laws.
    - pphysch 3y ago
      "not feudalism, because these lords are men of God", etc.
      - em-bee 3y ago
        lords claiming some rights supposedly ordained by god is quite different from a democracy that enacts laws that protect the rights of its citizens, especially the weaker ones. just because that doesn't happen in the US doesn't mean it can't happen, because it actually does in most of europe and other countries too.
        pphysch 3y ago
        They really aren't that different. Laws are twisted and changed and ignored by powerful people, whether those laws are divine or constitutional.
fsckboy 3y ago
here's a poser for you: if you live at your mom's house, but earn a good salary, that allows you to quickly build up a nest egg, that you can use as a downpayment on your first house. You buy the house with a mortgage, tying up your downpayment and obligating you to make monthly payments on the mortgage (which in the initial period go mostly to covering interest) Before moving in, you realize that you could keep living at mom's house and rent the house you bought out at market rates. Let's say the market rate for your house is $5K a month, money that you can put toward your mortgage or building back up your savings/nest egg. (if you are renting your house out, some other benefits accrue to you, depreciating it, etc, but we'll ignore those, keeping that in mind in case you start thinking it also has some costs associated with it) Now you have the thought... hey, wait a minute, does this mean that if you move into your own house, that act will cut off the $5K per month rental income, which makes it the equivalent of you having to pay the $5K rent yourself? Cuz, you could keep the rental income flowing if you rented another property, but if that one costs $5K too, the cash flow nets out to zero. Could this be true? owning your own house doesn't save you on rent? Because investing in a house entitles you to the rent from the house, so consuming the housing yourself costs you the monthly rent whether or not you are the owner? Yes, that's what it means. Buying a house does not save you money on rent, does not save you money on "housing consumption". We need to give our kids a better financial education, there are so many myths that keep people on hamster wheels they don't know that they are on. This is the reason that housing seems "unaffordable"; why should it be any more affordable than rent?
- polishdude20 3y ago
  I mean you still need a place to live right? And if you're going to pay for a house, you may as well be paying for it in order to own it later and sell it if you'd like? If you always rent, you never get that money back.
  - fsckboy 3y ago
    you completely didn't read what I wrote, you are not following along. you are wrong. read it again, if you reserve a private piece of real estate for yourself, whether by leasing it or buying it, you pay the same rent every month. Buying a house does not save you rent. The rent that you think you are not paying is rent that somebody else would be paying you. Not receiving that is the same as getting it and paying it back out.
1letterunixname 3y ago
Wonder why so many Irish flee for the States in modern times? Go to Ireland, then complain about rent and home ownership.
- mathgladiator 3y ago
  Care to expound on that?
opportune 3y ago
Previously the problem was that you had to have access to credit and enough money for a down payment to buy and then you’d quickly come out ahead vs renting. So it was a real problem not being able to get access to that advantage. But in the current situation you actually pay more to buy than you would to rent in most/very many cases, unless you’re counting on things like appreciation or planning to hold for 20+ years (if you are rent controlled/stabilized you may never come out ahead). So while homeownership is unaffordable in both situations, the repercussions and solutions are very different. Because policies like providing downpayments (which CA is considering/doing) will just exacerbate the situation in this case. And the negative impact is more qualitative like being established in a community or wanting to own a home as a right of passage, vs actually materially making you better off.
danielvf 3y ago
65.8% of Americans live in their own home. That's a higher percentage than the UK, France, or Germany. We aren't talking about there not being homes, it's that the youngest aren't able to. It's also a higher percentage of ownership than the US in 1940,1950,1960,1970, not 1980, but also higher than 1990. What it isn't higher than is the peaks of home ownerships hit during the low the low interest rate booms before the recessions of the '80s and 2000's. I don't think the current housing crunch will be forever - we've seen shortages like this several times before in US history. While some cities are fighting new housing furiously, other's aren't. Over time, the population migration to the places that are building will continue as it has over the last decade. Building houses is a boom and bust phenomena, and I've seen nothing to say that it's never coming back.
agentofoblivion 3y ago
So 66% say homeownership is hopeless and 59% say they are focused on the goal of owning…a car? Yes, if you’re currently unable to own a car, I can see why home ownership would appear hopeless. I’m sorry, but I just don’t have the empathy. I see the horrible financial decisions, and advice, all around me. I suppose this means the bulk of the 59% are financing their vehicles? If you have nothing to your name except debts, and want to change that, you should drive a POS. If you would like to own a home, but currently rent and have $40k in car debt, you’re not doing it right. I make quadruple what many of my friends and family make, and most of them have nicer vehicles and a driveway full of toys, like campers and motorcycles and boats. I went from making $65k in the Midwest to owning a million dollar home in Seattle in about 6-7 years and paying off all student debt, on a single income, while having multiple kids. I didn’t do anything crazy, I just saved more than I spent, invested in index funds, and never took on debt.
- heyoni 3y ago
  The point is that your average person that might prioritize a car, a less expensive endeavor over a house cannot afford to do so. Financing a car isn’t the issue, the fact that owning a home somewhere where jobs are is hopeless means people are going to spend their money elsewhere.
  - agentofoblivion 3y ago
    That’s incoherent. If you want to buy a home, but cant right now, financing a vehicle is an issue. You’re not “spending your money elsewhere”, you’re taking major debt to drive something you can’t afford, and paying dearly for it at the cost of your real goal, which is now further away than it otherwise would have been. In my experience/opinion, a major problem is people think in terms of monthly cash flow when trying to decide if they can afford something. That’s the fast lane for ending up in a place where you’re breaking even with monthly payments and never having much to show for it. Or, “the average person” I think you called them. The very same person that can’t come up with $600 in an emergency or whatever.
    - 3y ago
SirMaster 3y ago
I don’t even understand why owning a home is something so many people want. It’s generally not a good “investment” at all and renting is better. Plus all the upkeep and chores you need to do for a house.
- BFLpL0QNek 3y ago
  That’s the thing. A home should not be an “investment”, it should be a “home”, a home to live and give safety/security, not land, bricks and mortar someone purchases to make a capital gain or rental yield. Why do people want a “home”? It provides a security renting doesn’t, you can make it your home. Renting can be more flexible if you are nomadic, it can also be a huge pain dealing with leases, rental increases, dodgy landlords, a lack of security so can’t truly settle on a 12 month lease.
  - SirMaster 3y ago
    I agree buying a home should not be seen as an investment. I just mention that because it feel like everyone I talk to treats it like or talks about it like it’s a good investment. It’s totally fine to buy a home if you want to own a home. Sure there are plenty of reasons to want to own a home. But because it’s a great investment is rarely one of the reasons.
- lotsoweiners 3y ago
  I bought my house for under 300k in 2015 and could list it today for over 700k (good investment). Obviously I am not going to do that because of the interest rate increases which will keep mine and a large amount of the supply off the market but that is a different topic. I like owning though because I know no one will kick me out 12 months or significantly increase my monthly payment based on demand.
Ccecil 3y ago
A few years ago the local university did a study and found that 30% of my town could not afford to live in this town. Last year it was 75%. There are not jobs locally which can support the housing cost. Huge influx of people who seem to be purchasing multiple homes. 600 registered vacation rentals just in city limits (estimated closer to 1500 counting unregistered). Entire neighborhoods that only have 1 or 2 full time residents. My rent went up 20% last year (5 years in the same location) with no improvements made. My parent's house had their tax assessment go up 65% (they are retired, same house for 40+ years). I know of several companies that all just shut down due to someone purchasing the building where many small shops were operating from and doubled the rent. It is a shame being able to watch the destruction of the town I grew up in...even worse to know that I won't be able to live here much longer. Granted it is a vacation destination now...but when I was a kid it was the middle of nowhere where nobody wanted to live, downstream from a superfund site. Building more houses won't help if they are all used as investment. More developments need to have rules about the housing being used as primary housing, no rentals (short or long term), no flipping the house after 2 years. Focused on people who want to live and build a community long term. Turning all the affordable housing into hotels while turning vacant hotels into homeless shelters is an insane proposition...but it is currently the reality many cities are facing (see Spokane, WA as example of this exact thing).
- missedthecue 3y ago
  "building more houses won't help if they are all used as investment" Supply and demand applies to housing as well. If many new units are constructed, both rent and prices go down, even if they are used as investment.
  - nradov 3y ago
    In theory yes, if they build enough housing so that supply exceeds demand then eventually prices will drop. In practice though in popular vacation areas building smaller amounts of new housing often induces additional demand that drives prices up at an even faster rate.
    - 3y ago
RickJWagner 3y ago
“Whether you think you can, or you think you can't – you're right." Henry Ford's words ring true. Sure, there are some that can't afford to buy-- always have been-- but many can.

114 points by donsupreme 3y ago

I'm an early-90's "millennial" in one of the ten biggest cities in the United States and am unfortunately in a position where I couldn't even afford to move. It's not so much "the economy's" fault as it is my [yearslong] attachment to a company where there's been no wage growth (hopefully I'm out by September!). Altogether very much not what I ever thought "30"+ would look like for me.

anononaut 3y ago
Don't be too discouraged. Not a soul correctly guesses what their 30s are like. Just keep making good moves.
imbnwa 3y ago
Worst part is moving to smaller places is usually less culture but moving to bigger places is more expensive

noahtallen 3y ago

Definitely agree with this sentiment! Houses are affordable only in low cost of living areas where folks don’t want to live for a reason. Some of those reasons are subjective (not a lot to do in Ohio), and some are very objective (certain rural areas are extremely hostile to other groups of people). In major cities where people want to live (slash where well paying jobs are), it is very difficult to justify ownership. For example, a $600k house at 7% interest will loose money over 5 years even if you sell for $650k. And not just loose money, but loose even more money than renting for like $4k/mo. (And this accounts for a $100k down payment!) There is basically no way to justify ownership in these areas financially without coming into a significant amount of capital. And while you could afford it with a high cashflow (two high income earners, which is doable in major cities), you can get a nice apartment for $4k/mo that might have even more amenities than your house would have (like a hot tub). I think this is a huge bummer, especially because owning an apartment or condo is becoming more rare as well, since renting is more financially attractive to property owners. This basically makes it much more difficult to build wealth, and allows large developers to make off with a huge amount of money. So it does feel kind of hopeless in these large cities, even if you make a ton of money. You basically either have to accept taking a huge loss on ownership (unless you stay there for decades or get a great deal), or settle for renting.

coding123 3y ago
And at 4k a month for rent I would say life is just hopeless which might account for the mass shootings, suicide, homelessness, drug use...
wara23arish 3y ago
If you’re comparing it to renting you still come out on top no matter
- noahtallen 3y ago
  The numbers I shared in my post are from some basic math! Over 5 years, you spend more money, even if it appreciates by 5% when you sell it. This is because $170k of your mortgage payments went to interest alone, not to mention HOA fees, property tax, mortgage insurance, and maintenance. Unless the house appreciates a lot very fast, or you have very low interest rates, it’s very unlikely that a house in these cities ($650k, for example) will make you money at all in the mid-term, let alone beat renting.
- carbine 3y ago
  that's just mathematically incorrect as a generalization. it depends on the market, the price-to-rent ratio, interest rates, transaction fees, maintenance fees, taxes, and how long you're actually living in one place. if your burn as a renter is substantially lower you could invest the difference in a non-real-estate asset and make a lot more return, in many cases.
  - Sohcahtoa82 3y ago
    There are a lot of factors, but if you don't move, then I can't see any realistic scenario where renting comes out ahead in the long term. In my area, the price-to-rent ratio is nearly 1:1. When I bought my house in 2015, my mortgage payment (30 year fixed) was about $1,500/month (Plus ~$400/month property tax). Zillow estimated the rental value at $1,700/month. From the listings I've seen in my area, Zillow's rental value is pretty close to what people are paying. In my case, I would have been insane to choose to rent instead of buy. The thing to remember is that rent always goes up. 30 years from now, the rent could easily be anywhere from $4,000-7,000/month. Meanwhile I'll be making my final $1,500 mortgage payment. Yeah, if my water heater explodes, I'm on the hook for it. But a single month of savings in the difference between renting and buying years from now would cover the cost.

timcavel 3y ago

USA brand tax objects must deploy hypersonic nuclear drone bombers to ruthlessly enforce absolute maximum economic compliance immediately!!!

TrackerFF 3y ago

I moved out to the rural countryside, paid $120k for my house. Work remote, and meet my collogues 5-6 times a year in person. It's not for everyone, but I'm happy. Not being a slave to the bank (mortgage) feels incredible.

ihateyouall123 3y ago
But why do you censor yourself?
zenger 3y ago
Do you mind if I ask what state/region ?
elforce002 3y ago
Congratulations. That seems like a peaceful life right there. Enjoy it.
hanoz 3y ago
I seriously doubt there's a $120k countryside house within 500 miles of me.
- mokarma 3y ago
  Challenge accepted. Share your general area / zip code.
  - coding123 3y ago
    I'm looking for 100 acres with a new construction house that can't hear the road for about 400k, any takers? This was possible 10 years ago.lol we all missed out
  - red-iron-pine 3y ago
    ooooo oooo do me. Northern VA: 22030 I've got 3 kids, so no bungalows, and nothing that's in the ghetto, cuz SE DC almost certainly has cheap real estate -- and the highest murder rates in the US.

hanoz 3y ago

Western leaders had better start coming up with radical solutions to housing market driven inequity or there'll be ructions.

paxys 3y ago
There is a single solution for this – build more housing. Yet that option still remains unpopular, even among people who cannot afford housing. Blaming leaders is pointless. Instead organize and convince your neighborhood NIMBYs to change their minds.
- hanoz 3y ago
  "Just build more houses", yet alone when framed as "it's up to you to convince your neighbors to let you to build more houses" just doesn't cut the mustard any more. We need serious changes that are actually going to make a difference, along the lines of (for residential property): * Outlawing mortgages for non occupiers. * Sharing of capital gains with tenants. * A complete end to no fault evictions. * Universal right to buy for tenants. * Putative tax for rental income.
  - mrep 3y ago
    That would basically kill the entire rental market and force everyone who wants to move to a new place buy a place instead of having the option to rent which would make changing jobs super painful. I moved across the country after college for a job and my brother has done that like 5 times changing jobs. Buying and selling a place is a huge pain and has an extremely high transaction cost compared to renting.
    - sokoloff 3y ago
      Many people seem eager to screw over tens of millions of renters if it means they think they’d get a better chance to buy a place.
      - deleted 3y ago

lamp987 3y ago

In the future, only investment firms will own homes and everybody will be renting their whole life. At the end of their lives, they will have no inheritance to pass on to their children. You will own nothing.

pphysch 3y ago
Yep, corporate feudalism. But feudalism tends to end in (violent) land reform.
- em-bee 3y ago
  not feudalism, because these corporations can be well regulated and renters rights protected by law.
  - FractalHQ 3y ago
    Not if the corporations write the laws.
  - pphysch 3y ago
    "not feudalism, because these lords are men of God", etc.
    - em-bee 3y ago
      lords claiming some rights supposedly ordained by god is quite different from a democracy that enacts laws that protect the rights of its citizens, especially the weaker ones. just because that doesn't happen in the US doesn't mean it can't happen, because it actually does in most of europe and other countries too.
      - pphysch 3y ago
        They really aren't that different. Laws are twisted and changed and ignored by powerful people, whether those laws are divine or constitutional.

fsckboy 3y ago

here's a poser for you: if you live at your mom's house, but earn a good salary, that allows you to quickly build up a nest egg, that you can use as a downpayment on your first house. You buy the house with a mortgage, tying up your downpayment and obligating you to make monthly payments on the mortgage (which in the initial period go mostly to covering interest) Before moving in, you realize that you could keep living at mom's house and rent the house you bought out at market rates. Let's say the market rate for your house is $5K a month, money that you can put toward your mortgage or building back up your savings/nest egg. (if you are renting your house out, some other benefits accrue to you, depreciating it, etc, but we'll ignore those, keeping that in mind in case you start thinking it also has some costs associated with it) Now you have the thought... hey, wait a minute, does this mean that if you move into your own house, that act will cut off the $5K per month rental income, which makes it the equivalent of you having to pay the $5K rent yourself? Cuz, you could keep the rental income flowing if you rented another property, but if that one costs $5K too, the cash flow nets out to zero. Could this be true? owning your own house doesn't save you on rent? Because investing in a house entitles you to the rent from the house, so consuming the housing yourself costs you the monthly rent whether or not you are the owner? Yes, that's what it means. Buying a house does not save you money on rent, does not save you money on "housing consumption". We need to give our kids a better financial education, there are so many myths that keep people on hamster wheels they don't know that they are on. This is the reason that housing seems "unaffordable"; why should it be any more affordable than rent?

polishdude20 3y ago
I mean you still need a place to live right? And if you're going to pay for a house, you may as well be paying for it in order to own it later and sell it if you'd like? If you always rent, you never get that money back.
- fsckboy 3y ago
  you completely didn't read what I wrote, you are not following along. you are wrong. read it again, if you reserve a private piece of real estate for yourself, whether by leasing it or buying it, you pay the same rent every month. Buying a house does not save you rent. The rent that you think you are not paying is rent that somebody else would be paying you. Not receiving that is the same as getting it and paying it back out.

1letterunixname 3y ago

Wonder why so many Irish flee for the States in modern times? Go to Ireland, then complain about rent and home ownership.

mathgladiator 3y ago
Care to expound on that?

opportune 3y ago

Previously the problem was that you had to have access to credit and enough money for a down payment to buy and then you’d quickly come out ahead vs renting. So it was a real problem not being able to get access to that advantage. But in the current situation you actually pay more to buy than you would to rent in most/very many cases, unless you’re counting on things like appreciation or planning to hold for 20+ years (if you are rent controlled/stabilized you may never come out ahead). So while homeownership is unaffordable in both situations, the repercussions and solutions are very different. Because policies like providing downpayments (which CA is considering/doing) will just exacerbate the situation in this case. And the negative impact is more qualitative like being established in a community or wanting to own a home as a right of passage, vs actually materially making you better off.

danielvf 3y ago

65.8% of Americans live in their own home. That's a higher percentage than the UK, France, or Germany. We aren't talking about there not being homes, it's that the youngest aren't able to. It's also a higher percentage of ownership than the US in 1940,1950,1960,1970, not 1980, but also higher than 1990. What it isn't higher than is the peaks of home ownerships hit during the low the low interest rate booms before the recessions of the '80s and 2000's. I don't think the current housing crunch will be forever - we've seen shortages like this several times before in US history. While some cities are fighting new housing furiously, other's aren't. Over time, the population migration to the places that are building will continue as it has over the last decade. Building houses is a boom and bust phenomena, and I've seen nothing to say that it's never coming back.

agentofoblivion 3y ago

So 66% say homeownership is hopeless and 59% say they are focused on the goal of owning…a car? Yes, if you’re currently unable to own a car, I can see why home ownership would appear hopeless. I’m sorry, but I just don’t have the empathy. I see the horrible financial decisions, and advice, all around me. I suppose this means the bulk of the 59% are financing their vehicles? If you have nothing to your name except debts, and want to change that, you should drive a POS. If you would like to own a home, but currently rent and have $40k in car debt, you’re not doing it right. I make quadruple what many of my friends and family make, and most of them have nicer vehicles and a driveway full of toys, like campers and motorcycles and boats. I went from making $65k in the Midwest to owning a million dollar home in Seattle in about 6-7 years and paying off all student debt, on a single income, while having multiple kids. I didn’t do anything crazy, I just saved more than I spent, invested in index funds, and never took on debt.

heyoni 3y ago
The point is that your average person that might prioritize a car, a less expensive endeavor over a house cannot afford to do so. Financing a car isn’t the issue, the fact that owning a home somewhere where jobs are is hopeless means people are going to spend their money elsewhere.
- agentofoblivion 3y ago
  That’s incoherent. If you want to buy a home, but cant right now, financing a vehicle is an issue. You’re not “spending your money elsewhere”, you’re taking major debt to drive something you can’t afford, and paying dearly for it at the cost of your real goal, which is now further away than it otherwise would have been. In my experience/opinion, a major problem is people think in terms of monthly cash flow when trying to decide if they can afford something. That’s the fast lane for ending up in a place where you’re breaking even with monthly payments and never having much to show for it. Or, “the average person” I think you called them. The very same person that can’t come up with $600 in an emergency or whatever.
  - 3y ago

SirMaster 3y ago

I don’t even understand why owning a home is something so many people want. It’s generally not a good “investment” at all and renting is better. Plus all the upkeep and chores you need to do for a house.

BFLpL0QNek 3y ago
That’s the thing. A home should not be an “investment”, it should be a “home”, a home to live and give safety/security, not land, bricks and mortar someone purchases to make a capital gain or rental yield. Why do people want a “home”? It provides a security renting doesn’t, you can make it your home. Renting can be more flexible if you are nomadic, it can also be a huge pain dealing with leases, rental increases, dodgy landlords, a lack of security so can’t truly settle on a 12 month lease.
- SirMaster 3y ago
  I agree buying a home should not be seen as an investment. I just mention that because it feel like everyone I talk to treats it like or talks about it like it’s a good investment. It’s totally fine to buy a home if you want to own a home. Sure there are plenty of reasons to want to own a home. But because it’s a great investment is rarely one of the reasons.
lotsoweiners 3y ago
I bought my house for under 300k in 2015 and could list it today for over 700k (good investment). Obviously I am not going to do that because of the interest rate increases which will keep mine and a large amount of the supply off the market but that is a different topic. I like owning though because I know no one will kick me out 12 months or significantly increase my monthly payment based on demand.

Ccecil 3y ago

A few years ago the local university did a study and found that 30% of my town could not afford to live in this town. Last year it was 75%. There are not jobs locally which can support the housing cost. Huge influx of people who seem to be purchasing multiple homes. 600 registered vacation rentals just in city limits (estimated closer to 1500 counting unregistered). Entire neighborhoods that only have 1 or 2 full time residents. My rent went up 20% last year (5 years in the same location) with no improvements made. My parent's house had their tax assessment go up 65% (they are retired, same house for 40+ years). I know of several companies that all just shut down due to someone purchasing the building where many small shops were operating from and doubled the rent. It is a shame being able to watch the destruction of the town I grew up in...even worse to know that I won't be able to live here much longer. Granted it is a vacation destination now...but when I was a kid it was the middle of nowhere where nobody wanted to live, downstream from a superfund site. Building more houses won't help if they are all used as investment. More developments need to have rules about the housing being used as primary housing, no rentals (short or long term), no flipping the house after 2 years. Focused on people who want to live and build a community long term. Turning all the affordable housing into hotels while turning vacant hotels into homeless shelters is an insane proposition...but it is currently the reality many cities are facing (see Spokane, WA as example of this exact thing).

missedthecue 3y ago
"building more houses won't help if they are all used as investment" Supply and demand applies to housing as well. If many new units are constructed, both rent and prices go down, even if they are used as investment.
- nradov 3y ago
  In theory yes, if they build enough housing so that supply exceeds demand then eventually prices will drop. In practice though in popular vacation areas building smaller amounts of new housing often induces additional demand that drives prices up at an even faster rate.
  - 3y ago

RickJWagner 3y ago

“Whether you think you can, or you think you can't – you're right." Henry Ford's words ring true. Sure, there are some that can't afford to buy-- always have been-- but many can.