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Young Homebuyers Are Vanishing from the U.S. (bloomberg.com)
53 points by pseudolus 12 days ago | hide | past | web | favorite | 83 comments





I'm a single male, 30, who can currently afford to buy a house but isn't sure if I want to.

I understand it's an asset investment, but i fear that it might largely be detrimental to my lifestyle. I live in a high CoL area (Seattle), when I can only think about buying a house in the suburban area. This will increase my 10 min walk commute to at least 45 min bus/car ride. My social life may suffer due to the distances, but at the same time I want a place to call it my own.

Anyone else going through the motions or have a different perspective on how to figure out my dilemma?!


If you are unattached you should absolutely not buy a home in a suburban area, or anywhere really.

Planting a stake in the ground will make it harder to move to chase after better opportunities elsewhere, and that opportunity cost probably outweighs any asset appreciation you would see.

Buying a primary residence should be treated as an opportunity cost for the invested money, as well as a necessity for the shelter. If you are coupled it's harder to coordinate big moves so that makes owning more attractive, and if you have children you also want a stable environment for them to grow up in. But all told there are far better investments than a primary residence.

Seattle also has a high price-to-rent ratio: https://www.mashvisor.com/blog/best-real-estate-markets-pric... You may actually lose money on a cash flow basis if you buy.


>Seattle also has a high price-to-rent ratio: https://www.mashvisor.com/blog/best-real-estate-markets-pric.... You may actually lose money on a cash flow basis if you buy.

I don't know where they got their numbers, but they're saying that home price of a $1000 rental is $421,080 which is absolutely insane for Seattle. 3 Years ago when I was shopping around shitty apartments were $1500+, with decent apartments and houses renting for $2000+ easily. One of my family members rent out their $400,000ish house for something like $2200-2400 a month. You won't be able to find a $400,000 property to rent for anywhere close to $1000. My house was listed in the 200s, sold for 12% over asking, and has appreciated nearly 50%. If I ever move my house will rent for over $2000 a month easily and it's quite old and not even in Seattle proper


It looks like they got their numbers from 2017. The market really is that volatile there.

>If you are unattached you should absolutely not buy a home in a suburban area, or anywhere really.

That's nonsense. You shouldn't feel you have to buy one for financial reasons. But even if you're unattached, as I was when I bought, many of us like having a place of our own with more room than an apartment that you can change as you see fit.

Yes, it limits mobility to a degree. But I've changed jobs several times since I bought my house.


I overstated it because I was assuming a certain motive (financial), which as you pointed out may not be present. But as a young, unattached person mobility is one of your top competitive advantages in the labor market. I'm not talking about switching jobs in the same metro. I mean moving to an entirely different metro.

It does depend upon where you live to some degree. I wasn't that young (late 30s), was in a metro with a fair amount of tech (Boston) most of which was out west of the city where I already lived and worked, and had pretty much already decided I wasn't interested in moving to the Bay Area.

Sure, circumstances could have changed but I pretty much bought when I did in part because I decided that mobility wasn't that big a deal for me any longer.


I'm about your age, I also live in Seattle. Though, I do have a partner and a dog so that makes some difference. I chose to buy a home and I'm quite happy with it overall. It's a good place to have people over since it's much larger than the average apartment, I don't have to move every year or so to fight the rising rent, I have plenty of space for projects and storage of various hobbies. My family doesn't have to stay in a hotel when they visit because I have a spare bedroom now. I've also learned a ton of skills related to home ownership such as basic construction, electrical work, etc. which can be a plus if you're into that sort of thing. I prefer the quiet of the suburbs as well.

That being said, my commute is atrocious. It's about 1.5hrs each way into the city. Even so, I feel it's worth it. But obviously may not be for everyone.

Personally, I wouldn't look at it as an investment. It's more a lifestyle thing that you've gotta think you'll be happier with. My mortgage is the same as my rent was at the time, so I thought I was netting out just fine, but houses have a lot of expensive maintenance events that pop up and will put you in the red pretty quick if you're not careful. For example, my heat pump and furnace went out recently which will set me back several thousand to fix. So, while you're building equity in something, there is a hidden cost with that. Worth being aware of.

Hope that helps.


I took a long time looking for a home, precisely because I was unwilling to accept a long commute. Buying a house is not worth a 45 minute commute.

Leaving aside the considerable additional expenses of commuting, and the missed health benefits of a 20-minute walk every day, you're now talking about spending 70 extra minutes per day commuting. That means 5 hours and 50 minutes extra commuting per week (total of 7.5 hours), or about 12 extra 24-hour days of your year spent commuting.

You currently live 10 minutes walk from work. Don't move to 45 minutes drive/bus from work. That's a substantial chunk of your life you won't get back.

And as other replies have pointed out, in the area you're in, owning may not be a win for you.


Vaguely similar boat! Northern NJ though.

I'm 24 and became single about 6 months ago. After this happened, I moved out of my family home to rent closer to work, which cut an hour off my commute. It's been a mixed bag financially and I've been borderline paycheck-to-paycheck (I do max my 401k, so it's more of a self-wrought liquidity issue).

My thoughts:

- I'm really getting punched down by the 20% down payment standard. I know PMI is a thing, but it's a fee that I'd like to avoid paying in addition to interest. Assuming 20% is enough to avoid PMI, even if I snag a 600k condo I need 120k down to not have a PMI.

- I don't entirely know that I'd like to commit to this area, but I know I want to buy at some point, and I'd like to believe that snagging a property sooner than later will at least give me some leverage for a future purchase via the equity in the property. One of my friends bought a studio in FiDi for similar reasons- he'll probably break even in the `rent v buy` scenario but will at least have some sort of fund to fuel his next purchase via the equity in the apartment.

- This is also a game of forecasting your income for some period of time. I'm in software development, which seems stable for now (I hope), so I'm pretty confident in my ability to eventually pay off a high mortgage.

In the end, I have no hope of buying a place right now, all I can really do is shove money into a MM savings/mutual fund and wait around until its worth enough to convince a bank I'm worth their time.


PMI isn't awful. Look into what it will cost. It will be dependent on your credit score. I put 5% down and have a monthly PMI payment. Which has an initial "effective interest rate" of much must less than the mortgage interest rate! It's better than a piggy back loan and you get rid of it by paying down the principal to 80%.

Some very simple to use numbers to explain what I'm trying to say:

House price: $300000 Mortgage interest rate: 4% 20% to avoid PMI: $60000 5% of $300000 = $15000 down payment. Monthly PMI payment: $110 Annual PMI payments: $1320 Simple numbers:

I'm "borrowing" $45000 for the first year and it costs me $1320. Which is approximately 3%

Overtime since the principal to pay it down shrinks but the payments don't the "effective rate" goes up and eventually will be more that the mortgage interest rate. Pay it all off then.

You're more leveraged for better or worse. Your mileage may very.you need to talk to lenders and find what your PMI payments would be. They will vary. Lenders will try to get you to roll the insurance payments amount into the loan or some other screwy things where they make more money and get it up front.


Maxing your 401k at 24, wowza young people are smart these days. Whatever you do, do not beat yourself up about finances (too much, I mean maybe you're reckless elsewhere but I doubt it) because you've maximized meaningful time in the market like 2-3 years into your career. From a dollars perspective you'll be able to make all kinds of "mistakes" later on from that 1 decision.

PMI causes this kind of visceral reaction in people, but IMHO it's a little overblown. Using your example, if you put down 5% on a 600K loan and you have outstanding credit, it would cost you like 21K all-in, and at 3.75/30 year you'd be at 1.2M for the 600K loan. So think about your timetable for how long it'd go for 30K for 5% to 120K for 20%, compared to the 21K all-in costs of PMI. In fact you can pre-pay it for additional savings or not carrying the additional monthly payment, but anyways, just something to consider.


> I'm really getting punched down by the 20% down payment standard. I know PMI is a thing, but it's a fee that I'd like to avoid paying in addition to interest. Assuming 20% is enough to avoid PMI, even if I snag a 600k condo I need 120k down to not have a PMI.

Ask lenders about what's informally known as a "piggy-back loan". You can put 10% down, then get a second lien withdrawing that 10% and putting it towards the 20% number. That can avoid PMI, but be aware that the second lien will have worse terms, often with a floating rate, than the first so it's definitely in your interest to pay that off really fast. These were abused during the housing boom but they're not intrinsically bad. It may be preferable to paying PMI depending on how quickly you can pay off the second lien and how disciplined you are with money.


I put down 5% a few years and was able to avoid PMI by taking a higher rate (about 5%) -- forget what doing this actually called. You can take the increased interest as a deduction, but not PMI.

It's called lender-paid mortgage insurance, which comes in 2 varieties, the one you did where you take a higher interest rate or as a single one-time charge

Another thing to keep in mind, North Jersey has atrocious property taxes, and they keep going up.

This is true. The saddest part about this is a lot of new construction are luxury apartment buildings with 10/20 year property tax abatements. These apartments sell for millions. That's an insane tax revenue loss that literally goes to people who will probably be fine without that abatement.

Not only that, but the abatement being attached to that property inflates its selling price.

Figure out what it would cost to really move into that house. Full mortgage payment with taxes and insurance, plus increased utilities, plus maintenance things like lawn care, HoA dues, etc..

Figure out that total and continue living where you live, but save the difference between living in a house and living at the location you want.

All of a sudden a year passes and you have $15k in the bank and you've been walking to work in 10 minutes. As time passes you may find that you have enough saved to make a purchase a bit more luxurious (closer, bigger, whatever you like) than you could before. Or you may find that you like seeing that $15k/year that you now recognize as coming from not moving.

I mostly do this with cars. When I pay one off, I keep that car payment going into our "car savings" account. I'm allowed to pay maintenance from it, but that's it. It's amazing how attractive a used/paid off car is when you see the savings against the alternative.


TBH, those are the sorts of things people should be thinking about with respect to home purchases. Yes, there's a financial angle but that includes a lot of unknowns. Factors like mobility, proximity to work/entertainment/friends, time associated with upkeep (especially for standalone properties), etc. are probably what a decision should hinge on.

from a financial perspective, neither renting nor buying is inherently better than the other. in a particular locale, one or the other might be better based on the price-to-rent ratio.

so the decision of whether to rent or buy similar properties in a particular locale comes down to the local market, how long you can commit to staying, and your tolerance for different risks (rent increase, home repairs, suddenly needing to sell early).

you're not really deciding whether to rent or buy though, you're deciding whether to live in the city or move to the suburbs, which is ultimately a personal decision.

for the financial aspect, these articles might be helpful: https://affordanything.com/is-renting-better-than-buying-sho... https://www.getrichslowly.org/rent-or-buy/


Similar situation. If I bought a home, I would likely need to get more house than I rent (since it needs to be a place I can live for 5+ years). Additionally, in my market housing appreciation is not keeping up with the stock market. So it is both more expensive and less convenient to own a home for me.

Same page as you in San Francisco, plus houses are prohibitively expensive here so that doesn’t help convince me to buy. Commute is currently 12-17 mins depending on how I get there, I don’t want to lose that just yet.

Friend of mine, single, 30, in DC bought a condo. He seems to be happy with it since he is planning on being there for a while.

You are a human. Your place is the Earth. Feel at home with yourself, and you won’t need physical ownership to feel safe.

Do you mean - Don't buy a house, live in a van?

Down by the river?

YES. You should absolutely buy as soon as possible. I went through this when I was 30 before I got married and wished to hell I'd done it sooner.

1) You don't need to put down 20% anymore. If you have a W2 job and good credit, you can have your loan backed by the government in what is called an FHA loan.

2) Think of home ownership as putting a stake in the ground, but not being tied to that stake. You may only live there for a couple of years. You get a better job, get restless, that's ok. Move! You can rent out that house or sell it and pull some of the equity out of it.

3) Prices keep going up. Buying lets you lock in a fixed monthly rate, removes the fear of rent increases, etc. Heck get a condo and live downtown, live anywhere. Buying means taking control of your living situation and not having to be at the mercy of others.


That's a very rose tinted glasses view of home buying. Buying a home can be a very good idea, but it could also not be. So you got a better job and want to move, you better hope you can sell, it's no where near a guarantee that you can sell. You should never plan on being able to sell in a couple month period. Houses around where I grew up are taking multiple years to sell with prices the exact same as they were in the 90's.

Renting out a home can be very lucrative for some people, but also a lot of work. Boiler breaks on Christmas? You have to fix that and quick. All issues go through you, if you get a management company then there goes your profits.

Nothing in live just goes up forever, that's wishful thinking. While you may lock in a fixed mortgage payment, you have maintenance and house expenses. Houses get expensive fast. Anything that breaks, needs replacing, or you decide to fill because of lifestyle creep can cost a lot of money. Your weekends can quickly go from doing activities for yourself or your career to doing house work consistently.

Owning a home can be a really great idea and even a good investment, but that's no where near guaranteed and each person should look into there own situation.


Exactly. I own a home with a well and an acre. I don't spend my weekends out with friends anymore and the list of things to do is endless.

It's cool I can do what I want in some regards and have built some equity, but apartment living was so much easier. I honestly really miss it.


I agree with your point but disagree with some facts if you will allow some extra, potentially helpful information:

1. You can get into a house with good credit and 5% with private mortgage insurance. PMI goes away at 20%, fha you pay the mortgage insurance for the full term unless you put down +10% and wait 11 years. But you can always refi out of an fha loan, just compare your options because fha mortgage insurance is very expensive.

2. The break-even with financing costs usually means you’ll want to own for at least 7 years. If you know/heavily think you’ll be in a place for less than that and you don’t wanna rent it out then maybe don’t buy.

3. Sometimes prices go down tremendously. But you do lock in a payment, that you can make go down over time. Whereas rents tend to go up over time, or you incur expenses like moving or security deposit lockups etc.

Personally I’ve found one of the greatest benefits is that I control the destiny of the property. Every place I rented, the owner did not invest in the property, fixes to problems were done at least immediate cost (long term costs be damned!), etc. Now I can maintain the stuff that can break down well, get ahead of problems, and save a lot of my own time and prevent discomfort. Which is hard to put a price tag on.


"Asset management firms are required by the Securities and Exchange Commission to say that past performance is no guarantee of future results"[0]

I do agree with your other points though.

[0] https://www.thebalance.com/past-performance-is-no-guarantee-...


As a young person who could afford to buy a home, I'm not, simply because I expect the housing market to crash, and I absolutely don't want to be upside-down on a house right now.

You should not try to time the market, but the truth in your claim is that housing has diverged from its underlying value as a high yielding asset. If this is the case because land values have increased beyond present rent value due to demolition controls, restrictive zoning, etc. then you should never expect a SFH to be a worthwhile purchase-cum-asset though hopefully in the future a condo or town home might.

I am as well.

Although I've been "waiting" for a crash since 2013, and it still hasn't fucking shown up yet.

I will just keeping hoarding money until it happens, I suppose.


Personally, I suspect that when a crash happens, it will come with higher interest rates. A 2% increase will result in an 18% higher mortgage payment, which could actually be higher than the dip in home values.

That's why I'm buying right now. I too expect a dip in values within the next couple years, but we've got cheap money right now, and I don't plan on moving again for long while, if ever.


The counterargument you will hear to your strategy is: you can always refinance at lower interest rates if rates go down at some point, but you can never change the price you paid for the home.

Granted, you should do what works for you, but there is plenty to be said for purchasing a less expensive house when interest rates are higher.


Depends on the location, but a crashing house market halving the price (or even more) of properties is not uncommon. It happened in the last one.

Treating all of the US (or any country) as one housing market is also a mistake. As wealth and economic opportunity concentrate in certain areas, I would expect some places to crash, some to stagnate, and a few to keep rising. Right now, there’s quite a few states and vast swaths of regions with lower housing prices than ever before, or housing prices that don’t move up (upper midwest and northeast come to mind). And then there are places that not only held their own in the last recession, but have doubled and more.

Right? Also rates didnt rise from x% to 3x%, they actually fell to incentivize home buying

If it's an economy-wide crash, the opposite is more likely: a reduction in interest rates.

Can they really go much lower? Interest rates won't ever dip below inflation will they? If they do, wouldn't this be detrimental to the future of our economy?

My guess is that after the election's over, interest rates will start creeping up and eventually cause an overall reduction in housing values as it becomes harder for middle class incomes to afford homes at the current values.

I don't think a crash like 2008 is coming. I just think a relatively minor adjustment is right around the corner.


They can and were below inflation during the recession. At 1.55% now, were at 2% a couple years ago, but just ~0.07% (not a typo) during the depths of the recession. Below inflation.

For that matter, some places have mortgages below 0%. Denmark, for instance.

Fed rates can't really get much lower, so I'm not sure how that'd work out...

They can. They're at 1.55% right now (they were at 2% not long ago, I guess they're trying to stave off a dip in demand). During the depths of the recession, they were basically 0% (i.e. 0.07%, etc). Below inflation.

I sold my house 1.5 years ago (after owning for 5) expecting a market crash, still hasn't happened. A market crash was actually pretty far down on the list of reasons why for me, but it somewhat factored in. Whoops. Still got a nice return on it.

I’ve been thinking that for 10 years now. Whoops.

My wife and I both graduated from college in 2008, with a lot of student loan debt. That was a bad time time to graduate. We both took relatively low salaries and wages increases were nonexistent for a few years. Combine this will living in an already expensive market, and it was definitely difficult to save up enough to buy a house. We bought two years ago, in a city with a median home value of 580K and high property tax. My wife still pays ~1000 a month in student loans. We are trying to start a family, so we need to think about day care at some point. Student loans + daycare + mortgage is a lot. I feel incredibly blessed and lucky that we both have good salaries and very healthy savings.

Simple solution here is to not have kids and not have a house until you pay off the student loans.

It's like saying "Ahhh you see I want a Ferrari, a mansion, and a honeymoon but I can't find a way to finance all three"


I feel like a system that discourages young, healthy and educated citizens to not have children until they are much older... is screwed up. Especially since many of those with student loans are not finding jobs that would pay them off before the end of their child bearing years.

Sure, I agree the system is broken, but I am not sure if that will ever change, even if you attempt to organize some type of violent revolution.

As a result, you can only make the rational choices offered to you by the system, despite the system being deeply irrational.

That's why my gf and I rent a small place with the best roommates we can find, we don't have plans for kids, and we paid off student loans as quickly as possible and continue trying to increase our earning potential in tech


So don't have kids until you're fifty. Good plan!

This is the only rational choice offered by the current system, unless the odds of winning lottery ever change

You forget that changing system is an option. There are other countries and too few people consider emigration. Combined with remote work it enables a lot of interesting options for people in tech; I wound up with a tiny house for under $100k. It's not where I plan to be forever, but it means that I've got something so cheap I can afford to move somewhere else for a while (if desired) and keep this as a home base, so to speak.

So basically wait until you are infertile.

What actually is happening in the real world is people are either not having children, or, leaving them with grandma for child care, or, choosing a much older and richer husband

There are many people who still have student loans when they hit maternal ages which increase the risk of numerous problems for the offspring, like Autism Spectrum Disorder, Downs, or just miscarrying.

We definitely are getting a later start than we had hoped because of these issues.

In the UK the idea of buying a home to me seems like basically anchoring ones' self to a lifetime of having to maintain a highly paid career (assuming it's even possible in the first place).

I look at a 300K+ apartment and think - buying that for the average person would mean they could pretty much never take a break from the 40-hour a week grind for the next 15 years or more.

In a world in which we've pretty much bent nature to our will, buying a home should not be this colossal struggle in developed countries.

It seems like such an enormous drag on all activity - not just economic - "everyone" is running around pretending that they're in poverty and we can't solve any of the problems because the landlord sucked all of the money away.


You're right, it shouldn't.

But if you take that 1) housing is a necessity, 2) housing supply is restricted by law to a value below demand, and 3) we make it possible to get mortgages that DEPEND on "anchoring ones' self to a lifetime of having to maintain a highly paid career", this means that housing will eventually be priced at the amount of debt available.

If 20 people want 10 houses, all you need is for 10 of them to say "well I don't want a mortgage for 10x my income, but I guess it's what I need to do" in order to drive houses to be that price. If the bank made it 15x, then you'd see that as the price. Hell, there are places (Sweden iirc) with 100+ year mortgages and lo and behold, people take out these "mortgages" (basically renting from the bank at that point).

We could allow building more homes, but that would be unpopular with people who own houses, who are often old voters, so it's a nonstarter politically.

The goal is to keep housing _just barely_ affordable to people who work their asses off their entire productive life. It's an outcome of enforced artificial scarcity.


Maybe I need to double check the math on this, but due to amortized interest, I'll be paying 2 million dollars for my half million dollar home.

I don't understand why we are pushed to go into debt on housing. I don't plan to sell, and my apartment was 1/6 the price.

Looking back, I would have saved up money for 6 years and buy the same house with Cash.

The only way I see this as a good investment, is if we experience near hyper inflation in the next 15 years.


You might want to recheck your math. It should be ~$800k total with current rates. If you're including taxes, insurance, HOA fees, utilities, maintenance, etc, you'll easily be over a million, but I can't see any calculation coming out to $2M.

That doesn't sound right to me. I purchased my home about 3 years ago and if I remember correctly on top of principal I would end up paying an extra 40 percent or so in interest. To pay 2 million on a half million dollar loan your interest rate would have to be insanely high (like 30+ percent). In my case my mortgage was only about $300 more than the apartment I was living in previously (very expensive area) so it would've taken an extremely long time to save up the cash to purchase our home. The house has also appreciated nearly 50% since I purchased it, so if I had waited it would have been too expensive for my budget

That does not sound right to me. Your interest rate would have to be pretty high. I currently have a loan with a 4% rate I got last year, and my friends are reporting getting around 3% currently. With a 4% rate, you should end up paying a total of about $860,000 - $500,000 in principal payments and $360,000 in interest.

It is shocking how many people come out of a high school education in the US without understanding amortizations. I cringe every time I hear “front loaded” interest. As if the borrower didn’t “front load” the debt?

https://www.bretwhissel.net/amortization/amortize2col.pdf


For positive discount rates today's value (NPV) of both principal payments and interest will actually be less than what is stated as they are paid in the future (1:).

Of course, the effect of this depends on the size of the discount rate, https://www.investopedia.com/terms/n/npv.asp

(1: not looked at the calculation as the time period is not stated)


Also, buying the same house 6 years later means probably paying more for the same house. And you have to live somewhere in the meantime as well.

Single family zoning in particular skews the market and prevents more affordable options. Also, the tendency to for new construction to be bigger houses than people used to build with the same price/sq foot means a more expensive house to start with.

My wife and I make combined 250k per year, and even we are unsure about whether it makes financial sense to buy. I'm in a high cost of living area (NYC), and a 1 bedroom apartment is 600k or higher vs renting at 2.5k per month.

2 things:

1) The fees surrounding condos/co-ops are _real_. Like I've heard upwards of 1k a month.

2) Have you considered North NJ?


>Builders have cited a shortage of affordable lots and labor as reasons to build fewer or bigger single-family homes

I can't speak to the former, but the latter is definitely true in the Bay Area. I recently doubled the size of my once-modest house and it cost over $400/sqft. I speculate a few reasons:

1. There is a poor pipeline of Americans going into construction and the skilled trades

2. Because of (1), immigrants (illegal and legal) need to fill the gap, but immigration is being tightened at the national level

3. Competition with bigger projects (not really true this year, but was last year)

4. If we are to believe Nobel-winning economist Baumol, since house construction is a low productivity endeavor, it is subject to "cost disease" [1].

I don't think regulation played a big part in my addition's cost because building costs have been going up by 1% per month, roughly, and many of the most onerous regulations are decades old.

[1] https://en.wikipedia.org/wiki/Baumol%27s_cost_disease


Your addition would have been very cheap if the process wasn't tightly regulated by local, state, and federal government. The materials themselves are probably 20% of the cost for the whole project, the rest of the overhead goes (rightly or wrongly) to fees and inflated wages.

Just wanted to correct myself but Baumol, although distinguished, did not win the Nobel Prize

If you glanced upon my other comment in this thread, construction sticker shock got me too. My 2200 sf brownstone is now on the market because I couldn't afford renovation. Not building up or out (which I absolutely can add 1500 sf), but interior renovations would cost about 350K including permits, architect, etc. and so forth.

It's simply not worth it, but it would be if I had family, friends or better, staff, to handle doing a renovation more cheaply.

I feel terrible about selling but it's the best medium term business and quality of life decision. To respond to your comment, it's a mix of

construction boom (NYC)

min wage increase (good but should be mentioned)

Trump tarrifs on steel and timber

stricter oversight by current administration due to high profile accidents

complicated bureaucracy


Late 30s, single, owner of multi family in New York City of all places. Bought it a few years ago in an up and coming area that's now exploding.

Original idea: fix it up and either live in part and rent part, or rent it all. Rents are high here and mortgage is fixed at a low rate.

Reality: living in an up and coming area when you're a professional and gentrifier, and surrounded by 25 year old barristas, artists and rock stars is difficult. Rats are annoying and always find a way in. Construction costs are not 10 or 50 pct more than what was estimated to me by several people when I bought, they are 300 pct what the estimate is. I can't afford it. What else is hard, an insulated brick house from the late 1800s, illegal work done before me, and dealing with contractors and handymen.

It's going for sale next week, unrenovated.

Would I do it again? Probably not.

What I gained: equity (1/4 of the mortgage) plus rental income minus mortgage and taxes means I paid 1K a month for a brownstone while a 1 bedroom apartment costs 3200 here. Thus I saved money.

What I lost: several years of my single life being stressed in a commute and in a lawless/hostile neighborhood.

It's a real toss up. I'll be a renter again soon.


Businesses have burnt job security to the waterline and demanded more mobility of workers. Meanwhile, they have concentrated jobs in high-cost-of-living cities while completely ignoring Rust Belt bargain prices. Incumbent NIMBYs have quashed higher-density housing construction. Nobody can confidently expect to stay in one place for the minimum 5 years it generally takes to break even on selling one's primary residence with a 30-year mortgage.

It's a perfect storm for living in a van down by the river--or at least renting for a long, long time.


At one point I considered buying a home, but the flexibility of renting outweighed the benefits in the current economic climate, where I'm uncertain how things will go in the next few years.

Uncertainty for the bottom 4 quintiles of the populace is the real drag on the economy. Whether it be unexpected healthcare costs, or instability in income due to automation and consolidation, the lack of stability affects not only home buying, but also building relationships and creating networks of family/friends.

My wife and I bought a condo this past year. It's working for us at the moment, but getting an offer accepted without breaking the bank was the hard bit. We got our offer rejected, then someone else reneged on an offer, and then we were asked to fucking match their offer. We had to go up from our original, which was already quite sufficient, just to get it accepted, and even that was by luck! It was something like the third place we'd offered on.

This is median age. I have just listed my house and the two most serious parties are empty nesters looking to downsize. Either couple would bring up the median in the "all buyers" category.

Also home ownership makes it harder for people to move, which was a core element of mid-century economic growth in the US. So this isn't an inherently bad thing.


well just an observation, yes median home prices are high in some areas but too many potential buyers aim too high.

throw in all the monthly bills people accrue it is easy to nickle and dime yourself out of home ownership. so many services wanting their ten to thirty dollars a month

however one consideration not mentioned in the article is high property taxes that can raise the per month cost of owning a home beyond what many can afford or safely afford in one half of the income stream is lost. I am in a lower tax area but even that adds over two hundred a month just to own the house not counting all the other assorted costs. Go closer in town and I can see that number double if not more.


In the DSM market NIMBY regulation and HOAs have driven out bungalows, ADUs, and efficiency condos. Almost all new construction is $300k and up. There just isn’t affordable supply for 20 somethings.



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