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Couples who are both professional,combined income in 6 figures should have no problem servicing a high 6 figures mortgage..
Yes, there are plenty of such couples (or even singles!), who could afford a house even in coastal California or NYC. But the question remains: should they? Would this, under current economic conditions, be a wise deployment of their money? Or might it instead be the case, that the same sedulous frugality that got them financially to where they presently are, be more consistent with renting something modest, than with splurging on the "American Dream"?
I'm not in that bad of a spot, and luckily I have a decent apartment that I like; proabably up there for the best rental I've ever had. I make enough to continue living this way.
But career-job is supposed to = owning a house. I worked effing hard to own a house it was my goal for over a decade. Now, I can't just re-create what I did before because the prices are simply THAT out of line. Renting is technically throwing money away... but so would maxing out a mortgage! I would pay about $1500 a month more, literally double my apt. rent to own a house that is in worse shape than the duplex I'm renting. They only raised my rent by 1% this year, which tells me they are asking what the market will bear for a unit of this quality. Renting simply makes more sense right now, until or unless prices decline, more units come for sale, or both. One major problem I have is that there simply *are not* the kinds of units on the market that I would want to buy. I don't need a 2000sf house that costs $625k. Even if I had the money, that would be a waste. I don't even use all the square footage of my 825sf apartment! I live in about 600sf of it and the 2nd bedroom is storage! Which is why I'm working on converting that br into an airbnb room.
The kind of house that I first bought in 2014 - a 2/1 1000sf 1950s house, does not exist on the market right now. I'm not sure what happened to units of that nature. When I was on the market in 2014, there were quite plentiful listings of fixer-uppers in the 100-200k range. Today I would expect the prices to be 200-300k for an equivalent unit, which I would accept. There are NONE right now. Zero. Everything is 490k+ and more house than I want or need. If they are under 300k they are manufactured where you don't actually own the land.
It's why it's ridiculous to accuse me of wanting a house outside my means, when in fact my goal IS to purchase a house with PITI approximately what my rent payment is. I was able to do that pre-covid. Now, it seems impossible. They don't exist.
Oh, I get it. I'm angry too, but not for the same reasons. I'm angry because I see a giant class divide that gets wider and wider as time goes on. I see injustice in it. I also see cavalier cluelessness. There is a contingent of people, many of whom are long since retired, who have no idea of what it is like for people a couple of generations behind them. I read the rules and know we're not supposed to discuss "generations" on this forum, but it is what it is. I hear a lot of 70somethings going on about how if younger people just didn't buy things like avocado toast, they'd be able to afford a house. It's mind-blowing how out of touch they are. Not all, for sure, but a lot. It's weird, because it's their own kids and grandkids they are maligning.
My point is that it's probably not serving you to wish ill upon others with 20% employment, just so you can buy a house. I mean, you have already bought a house. A lot of people have never been able to do that much.
Oh, I get it. I'm angry too, but not for the same reasons. I'm angry because I see a giant class divide that gets wider and wider as time goes on. I see injustice in it. I also see cavalier cluelessness. There is a contingent of people, many of whom are long since retired, who have no idea of what it is like for people a couple of generations behind them. I read the rules and know we're not supposed to discuss "generations" on this forum, but it is what it is. I hear a lot of 70somethings going on about how if younger people just didn't buy things like avocado toast, they'd be able to afford a house. It's mind-blowing how out of touch they are. Not all, for sure, but a lot. It's weird, because it's their own kids and grandkids they are maligning.
My point is that it's probably not serving you to wish ill upon others with 20% employment, just so you can buy a house. I mean, you have already bought a house. A lot of people have never been able to do that much.
I don't see how else it ever resolves without a recession to even things out. I'm baffled where ANYone gets the money to pay these prices. It's as if half of Americans became millionaires thanks to covid or something. Clearly there are many tens of millions of Americans that have multiple 6-figures or 7 figures to purchase housing.
I don't see how else it ever resolves without a recession to even things out. I'm baffled where ANYone gets the money to pay these prices. It's as if half of Americans became millionaires thanks to covid or something. Clearly there are many tens of millions of Americans that have multiple 6-figures or 7 figures to purchase housing.
Not necessarily. Quite a few young people live with their parents rent-free until they're nearly 30, and they put away the money they'd spend on rent, even as they pay down student loans. It's not something I'm familiar with. Like many in my generation I'd have chewed my own arm off rather than live with my parents when I got out of college. In fact, after one summer home in college, I never lived in my parents' house again.
But I also was able to get a job with a salary that actually allowed me to live on my own, pay my own rent, and pay my student loans back. Also, as I said earlier, a copy-jock summer job was enough to cover rent with roommates during the summer--in 1986. With stagnant entry-level wages and a pile of student loan debt, a lot of these younger folks today can't do it all (rent AND loan payments), so they live with Mom and Dad rent free, and sometimes Mom and Dad help out with the student loans, too.
The current Payroll numbers and the National Unemployment rate are the same prior to the economic slowdown due to the Pandemic. Which lead me to believe we are already at full employment and might have a double dip recession. https://ibb.co/MpP8xqt
I don't see how else it ever resolves without a recession to even things out. I'm baffled where ANYone gets the money to pay these prices. It's as if half of Americans became millionaires thanks to covid or something. Clearly there are many tens of millions of Americans that have multiple 6-figures or 7 figures to purchase housing.
That seems accurate actually, in 2019 at least.
Quote:
The 90th percentile of household wealth was $1,301,000, meaning one in ten households had wealth exceeding $1.3 million.
Unfortunately that report does not seem to include the number of households in the US in 2019, but given a population of 330 million I think 10% of households puts you close to 10 million households and tens of millions of people in those households.
A lower-end house in my current local market (Los Angeles) is somewhere in the $800K - $1.1M range. Attending open-houses in that range, the throngs of my fellow lookers and tire-kickers tend to be couples under 40. Occasionally under 30, but most commonly in their 30s. Sometimes these are traditional families with kids. Other times, two women who come in holding hands, etc. But all are young-ish. From where do they find the money? They can't all be hedge fund managers, movie producers or tech bros. And while doubtless some are casual lookers, out for a noncommittal and fun afternoon, there has to be a serious one or two in there somewhere, as a day or two after the open house, Zillow starts showing the property as "pending" or "under contract".
People have money. Maybe not in the Midwest, but they do in LA. Maybe they don't have 20% down, and need private mortgage insurance. But they seem to be able to qualify, even now. There's a lot of wealth in America, and much of it appears to be concentrated in the marque cities.
Less Americans are working now than before, which proves the gov't employment statistics are contrived to mislead. Most posters in this thread have no idea they're being lied to, & how DC & media purposely ignores the most important metrics.
For the past 22 years the % of Americans working has fallen. It peaked at 67% in 2000, & is now only 60%:
Gov't labor stats fed to you all each month by the media is propaganda...it totally ignores the overall size of the labor force, & the overall % of Americans working....huh? Yes...true, yet most Americans fall for the lies every single month
The labor stats fed to you all each month is meaningless drivel, tripe, propaganda. They are small slices of the big picture...so, here are the key facts they are not telling you:
-Real wages have been declining for decades, & will continue to decline
-The total number of Americans working has been declining for 20+ years, & will keep declining
-The total percent of Americans working has decined for 20+ years, & will keep declining
The root cause of all this is bad government policies that ages our population, & reduces birth rates. It all comes back to this...gov't killing the private sector where growth occurs:
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Non Farm payrolls and the Unemployment rate
