Atlanta millennials want to buy a house, just can’t afford to, survey says (Buckhead: crime, lawyers)

[fourthwarden]

Originally Posted by AUGnative

actually buying a home was much harder to do for previous generations.. Does anyone remember the double digit mortgage rates of the 1970s? However people still managed to become homeowners. They did this buy saving money, maybe working a second job, cutting daily expenses, and buying a starter home first...then after building enough equity graduating to something nicer. That is how our family did it. Also, maybe it is better to get a marketable trade skill at a vocational school instead of going into $100,000 in debt for college loans for a non marketable degree. There is always a demand for nurses, medical techs, plumbers, mechanics, etc.

In 2070, the average cost of a house in the U.S. was $26,600. Adjusted for inflation, that's roughly $167,800. Yet the current average for a house is $406,000. That's a 142% increase over the cost adjusted for inflation. Compare that to real wages, that have grown only a measly 50% - 20% since 1967 for the vast majority of Americans, then add in that household debt is over twice as high a percentage of GDP now as it was in 1970, and that average education costs have increased by over 200% adjusted for inflation (For both private 4-year and public 4-year. Public 2-year schools have increased by early 300%).


Mortgage rates are significantly lower now than in 1970, but everything else is playing into an overall harder situation. Slow-growing & stagnant real wages, costs outstripping inflation, and far higher debt burden all pile on to make things like homes harder to justify.

[AUGnative]

The current average for a house is $406,000??? In what market?
Also anyone remember 1970s Stagflation?? Sky high inflation with stagnant wages. People somehow survived.. maybe because you didn't need to accrue tens of thousands in college debt for the privilege to work at a coffee shop or a retail store.
Inflation has been mild compared to the 1970s and early 80s. There is a reason why seniors have seen very little COLA increase in their social security payments over the past 8 years... because overall inflation has been low. Yes, in certain markets home costs have gone up.. and yes $406K avg sounds about right for expensive markets like Southern California, DC metro area, and Bay area.. but in Atlanta $406K is well above what the average is.. you find a decent home in this market for between $200 and $300k... even less in certain areas. Certainly if you want to live in Country Club of The South, you can expect to pay in the millions.
But Savings makes a big difference.. and this "millennial" generation saves the least of any previous generation and that is what is keeping home ownership out of their reach. I sacraficed a lot of short term wants in my younger years to save for a down payment n my first home. But I guess that is not easy for an entitled generation who wants everything handed to them on silver platter and expects to live in the chic cool neighborhoods right out of college on a salary from working at a coffee house.

[AUGnative]

Also I know many young people who graduated from GA Tech with "marketable" engineering degrees who have had no trouble finding good paying profesional jobs in their field and who have managed to buy a home or condo before age 30.

[arjay57]

Originally Posted by fourthwarden

In 2070, the average cost of a house in the U.S. was $26,600. Adjusted for inflation, that's roughly $167,800. Yet the current average for a house is $406,000.

The Census Bureau says the median home price in 1970 was $23,600. It's now around $200,000.

https://atlanta.curbed.com/2016/8/3/...it-record-high

Will $200K get you a cush bungalow in Peachtree Hills or Candler Park?

Nope, but most people don't expect to start at the top. There are still plenty of affordable houses in metro Atlanta and in the city proper. While your first home is likely not your final destination, you have to jump in somewhere. Sweat equity and the willingness to put up with a little less than perfection makes a huge difference.

If you can swing something in the mid to high $100s you ought to wind up with a mortgage payment around $600 or less. Live there a while, fix it up and sell it for a $30K profit. Then move on up the ladder. Countless people have done that.

[samiwas1]

Originally Posted by AUGnative

The current average for a house is $406,000??? In what market?
Also anyone remember 1970s Stagflation?? Sky high inflation with stagnant wages. People somehow survived.. maybe because you didn't need to accrue tens of thousands in college debt for the privilege to work at a coffee shop or a retail store.
Inflation has been mild compared to the 1970s and early 80s. There is a reason why seniors have seen very little COLA increase in their social security payments over the past 8 years... because overall inflation has been low. Yes, in certain markets home costs have gone up.. and yes $406K avg sounds about right for expensive markets like Southern California, DC metro area, and Bay area.. but in Atlanta $406K is well above what the average is.. you find a decent home in this market for between $200 and $300k... even less in certain areas. Certainly if you want to live in Country Club of The South, you can expect to pay in the millions.
But Savings makes a big difference.. and this "millennial" generation saves the least of any previous generation and that is what is keeping home ownership out of their reach. I sacraficed a lot of short term wants in my younger years to save for a down payment n my first home. But I guess that is not easy for an entitled generation who wants everything handed to them on silver platter and expects to live in the chic cool neighborhoods right out of college on a salary from working at a coffee house.

Read the rest of his post outside of the cost of a house. Most costs are WAY up and wages are the same or lower than they were in the 70s. It is simply harder to save up these days for most people. Even for a $200,000 house, you should be making at the very least $40,000 (and that's a stretch). Well over half of working Americans don't make that much.

[fourthwarden]

Originally Posted by arjay57

The Census Bureau says the median home price in 1970 was $23,600. It's now around $200,000.

https://atlanta.curbed.com/2016/8/3/...it-record-high

Will $200K get you a cush bungalow in Peachtree Hills or Candler Park?

Nope, but most people don't expect to start at the top. There are still plenty of affordable houses in metro Atlanta and in the city proper. While your first home is likely not your final destination, you have to jump in somewhere. Sweat equity and the willingness to put up with a little less than perfection makes a huge difference.

If you can swing something in the mid to high $100s you ought to wind up with a mortgage payment around $600 or less. Live there a while, fix it up and sell it for a $30K profit. Then move on up the ladder. Countless people have done that.

I quoted the census bureau's numbers on national prices.


The problem is that you're assuming that the 'affordable' house brings with it things that make it valuable enough to justify. Additional transportation costs, time lost to commutes, those 'fix it up' costs, property taxes, unreliable home values in far out suburbs, and a heap of other things can easily make a 'starter' home a worse proposition to someone who doesn't want it in the first place.


Countless people may have done so, and many still are, but times are a changing, and so with them does the cost / benefit analysis.

Originally Posted by AUGnative

Also I know many young people who graduated from GA Tech with "marketable" engineering degrees who have had no trouble finding good paying profesional jobs in their field and who have managed to buy a home or condo before age 30.

I'm saying this as a millennial engineer in a 'marketable' field: it's not the cure-all job that so many try and make it out to be. GA Tech is one thing, but the median starting salary of a mechanical engineer is only $9,000 more than the average income in the U.S.. That'll get quickly swallowed up in loans and various other things depending on costs of living.

[DaBurgh]

In some cities you can still find livable homes within city limits for as little as 25k - I don't know enough about Atlanta to know if that is the case, though.

[JPD]

Originally Posted by fourthwarden

far out suburbs

What's all this about the far out suburbs? You can find move-in-ready 3 (and even 4) bedroom houses in the low 200s all day long in the close-in, ITP suburbs, in stable, well-established neighborhoods. And you can find perfectly good houses in the mid-100s just across 285.



https://www.zillow.com/homes/for_sal...99_rect/14_zm/

https://www.zillow.com/homes/for_sal...99_rect/14_zm/

https://www.zillow.com/homes/for_sal...79_rect/14_zm/

https://www.zillow.com/homes/for_sal...54_rect/14_zm/

[Beretta]

Originally Posted by fourthwarden

In 2070, the average cost of a house in the U.S. was $26,600. Adjusted for inflation, that's roughly $167,800. Yet the current average for a house is $406,000. That's a 142% increase over the cost adjusted for inflation. Compare that to real wages, that have grown only a measly 50% - 20% since 1967 for the vast majority of Americans, then add in that household debt is over twice as high a percentage of GDP now as it was in 1970, and that average education costs have increased by over 200% adjusted for inflation (For both private 4-year and public 4-year. Public 2-year schools have increased by early 300%).


Mortgage rates are significantly lower now than in 1970, but everything else is playing into an overall harder situation. Slow-growing & stagnant real wages, costs outstripping inflation, and far higher debt burden all pile on to make things like homes harder to justify.

Assume you meant 1970? If so I will change your post for you and delete this one and your answer.

[fourthwarden]

Originally Posted by Beretta

Assume you meant 1970? If so I will change your post for you and delete this one and your answer.

Haha, yes, I did. Thanks for the catch.