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The majority of 18- to 29-year-olds in the US are now living with their parents (axios.com)
591 points by jbegley 13 days ago | hide | past | favorite | 937 comments





I really love the quote at the end:

> I'm a dad who is happy to have his daughter and fiancé living with me. They pay the utilities and make me nice meals, and it makes it a lot less lonely here. ... I like the multi-generational thing. I know it won't last forever, but it makes life better for now.

It's so easy to get into that cold statistical mindset about these large-scale trends, but it's good to remember that these statistics are the aggregation of a large number of very human stories.


It's also useful to note that the "nuclear family" is a very Western thing, and the US takes it to an extreme. In other parts of the world it's abnormal for adults in their 20s to be living anywhere but with their parents, often even with a fiance or new spouse in the mix.

The idea that having a multi-generational household means that the younger members haven't "grown up" and need to "learn to live on their own" is a completely manufactured attitude. I think many American families would have much stronger, more healthy inter-generational relationships if we lived together (at least for a bit) as adults. As it is now, most US kids leave home just when they're starting to be able to meaningfully contribute to the household as equals.

(Having said that, I definitely feel the pull of childhood and societal expectations. When I was a new adult I was thrilled to be out of my parents' house, and could never have imagined moving back there. I'm nearly 40 now, and thinking about the possibility of living in my parents' house during my 20s still feels weird to me.)


While it's true this seems like a strong US thing, I haven't heard many happy long-term stories of folks living intergenerationally.

In my experience (talking to people from a variety of countries), most couples in their 20s/30s want their own place (even in the countries where it's not common). It seems it can even lead to happier intergenerational relationships when the roomate-type fights don't need to happen.

It would seem to me that it's most common in the US to move out because they can afford to... The US is just an incredibly rich place, even compared to much of western Europe (ex. the US has 40% more GDP per capita than France[1])

There are of course also family/social pressures in some places, but I really don't think it's the primary factor in the differences between many countries.

[1] https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)...


Some thoughts about that:

1. In the US, zoning laws discourage building things like the "mother in-law suite". These zoning laws were originally created as a way to get around federal laws prohibiting discrimination of race and sex by making it more difficult for people who can't afford housing to live within a certain neighborhood. Even if US residents wanted to add housing for some semblance of independence, zoning laws makes this difficult.

2. In the US, children are educated to become factory workers, and inegunity is deliberately suppressed. (See John Taylor Gotto's The Underground History of American Education).

3. When I look at Carol Sandford's work on regenerative business and regenerative life paradigms, I realized that people here in the US have been conditioned to think that being able to live independently is the mark of an adult. But that is an illusion. They are still largely treated like cogs, whether those are adults who are working full time jobs, or children in the compulsory school system.

4. In contrast, a regenerative business builds up the capability for each employee to figure out what they want to do that will make a meaningful contribution to the business and society in a way that aligns with the general direction the organization is going and the general strategy. Being able to do that gives a far greater sense of fulfillment, purpose, and agency to the people involved. It's as if every employee has the chance to be a mini startup within a larger organization, and the organization as a whole become more adaptive, resilient, without sacrificing being a responsible corporate citizen.

5. When I think about how that is applied to children, I am reminded by the NPR article about how indigenous families have children doing chores without resentment. (https://www.npr.org/sections/goatsandsoda/2018/06/09/6169288...) ... and then I realized that, it isn't really about chores. It is a way that children from indigenous families are encouraged to make meaningful contributions to family and community from a young age.

6. If your sense of self-worth and purpose is derived from making meaningful contributions to the family, community, and society, you're no longer pidgeonholed into the role of being a child. As such, I think a lot of the tensions and inter-generational drama we expect from adult children living with their parents is no longer there.


> 6. If your sense of self-worth and purpose is derived from making meaningful contributions to the family, community, and society, you're no longer pidgeonholed into the role of being a child. As such, I think a lot of the tensions and inter-generational drama we expect from adult children living with their parents is no longer there.

This times ten to a very meaningful exponent.

A large number of factors in society have combined against children being able to gradually assume the mantle of adulthood, gradually assuming responsibility and making greater and greater contributions to society as they grow.

It is obvious that this is in no way culturally sustainable.


I think Carol Sandford's work has a shot at making this happen, but it won't happen at a policy level or through collective action. It's not so much that it is not scalable, but that by nature, it is impossible to implement with policy. If we were to make a policy to implement this, even if everyone agrees to do this, it misses the point. The motivation no longer comes from the inside nor would it be self-selected. But that does not mean it is impossible to implement at all.

This isn't something that you try to change the whole world. It is something that an individual makes the choice for themselves. It's something I'm in the process of implementing with my own children. That is one of the things I came up with when I ask myself, what meaningful thing do I want to contribute to the world? Your answer for yourself might be different.


A granny flat or mother-in-law suite would be cheating. It's a separate apartment. Your parents are your neighbors not your room-mates anymore.

Education in other countries is far more strict and regimented than the US. Especially Asia.

I've always thought the main driver for leaving home is instinctive, basically teenage rebelliousness. If there's cultural "programming" going on, it is just as likely to be in the societies that overcome these drives and keep children subservient to their parents.


> A granny flat or mother-in-law suite would be cheating. It's a separate apartment. Your parents are your neighbors not your room-mates anymore.

That's correct. It gives some semblance of independence. My point with that one is that even if US residents were inclined to "cheat", current zoning laws in most municipalities makes building additions, or expanding to duplexes and triplexes illegal. Other things like, requiring onsite parking, setbacks, not allowing mixed-use zones impacts the ability to have affordable housing.

These laws are changing. Portland recently expanded the zoning laws to allow many of those. The activists who got that through campaigned under the banner of "walkability", but it was a lot more than that. Other cities may follow as they see how well Portland does.

> Education in other countries is far more strict and regimented than the US. Especially Asia.

I was born in Taiwan and was raised mostly in the US, so I have had a taste of what that strictness is. A lot of the structure that the US compulsory school system is based on, took their playbook from the way the Indian caste system educate their children. That educational system was there before the industrialization took that method for its own use.

To be clear, when we're talking about "education", we're talking about "compulsory education" that is part of the predominant paradigm of the modern world. Prior to the compulsory educational laws, the US had a literacy rate of 99%, in a nation of farmers. Kids were taught at home or in one-room schools. It was understood that the main purpose of education was not to create factory workers, but to have critically-thinking and informed citizens in a republic. The contrast between that and our current generation of algorithm-driven conspiracy theories is stark.

What I just talked about and more is in John Taylor Gatto's book.

There are alternative models showing up here. Alaska does not put all the kids all in the same grade. There are too many kids in the bush. Instead, kids learn each subject at the competency level independently. A kid might be at 8th grade reading level for example, and still working through 3rd grade math. Carol Sandford's work on education is much more radical -- no cirriculum, no teachers, no grading. Instead, capabilities like critical thinking are developed, and the kids are taught a framework in which they evaluate their contributions and actions. The kids decide what they want to contribute, and then they figure out how they are going to do it.

> I've always thought the main driver for leaving home is instinctive, basically teenage rebelliousness. If there's cultural "programming" going on, it is just as likely to be in the societies that overcome these drives and keep children subservient to their parents.

Adolescence is a distinct phase that is studied by psychologists during the modern era. It didn't really exist pre-industrialization, pre-compulsory schooling. It used to be, around the pre-teen age, kids were apprenticed and treated as inexperienced young adults. Some cultures had rites of passages that definitively marks when childhood ends, adulthood begins, in a way that the whole community acknowledged. I suppose in the modern era, the ability to be financially independent from the parents a sign of adulthood.

Compounding that is better nutrition, and perhaps, the way our food is grown (hormones), and artificial lighting all contributes towards an earlier age of pubescence. Modern kids' physical maturity are happening at a younger age at the same that the length of time before they are treated as a full adult gets extended.


> US had a literacy rate of 99%, in a nation of farmers. Kids were taught at home or in one-room schools. It was understood that the main purpose of education was not to create factory workers, but to have critically-thinking and informed citizens in a republic. The contrast between that and our current generation of algorithm-driven conspiracy theories is stark.

That is complete bullshit. In 1870 there was a 20% illiteracy rate: https://nces.ed.gov/NAAL/lit_history.asp

I suggest you seriously reconsider your views on how the current education system works vs how it used to be back when people were on farms and learning in one room schoolhouses. It smells to me like you’ve been fed a line of bullshit by someone who has a beef with the current system and just wants to paint the ignorance-filled past with rose-colored enlightenment glasses. This society of highly literate, critical thinking farmers did not exist.


According to that article you linked, the method in which they were using puts the 1979 literacy rate at 0.6%.

"The more recent focus on illiteracy has centered on functional literacy, which addresses the issue of whether a person's educational level is sufficient to function in a modern society. The earlier surveys of illiteracy examined a very fundamental level of reading and writing. The percent of illiteracy, according to earlier measurement methods, was less than 1 percent of persons 14 years old and over in 1979."

I don't know where that 99% figure that John Gatto Taylor came from. He did talk about a significantly lower literacy rate in the 1970s. I think if one were to use functional literacy as the metric, there would still be a similar decrease literacy rate.

And no, Taylor was not trying to paint the past with rose-colored glasses. Whether or not the farming society did a good enough job as citizens, the frame in which education was viewed was much different. The things from the past is not necessarily better, but neither are the way we are doing things right now.


This.

See my comment above :)


> It was understood that the main purpose of education was not to create factory workers, but to have critically-thinking and informed citizens in a republic

Lol. Read Wealth of Nations by Adam Smith... having children was for the purpose of making you rich!

Also, that’s if you even made it to the age of 14. In 1870, survival rate of reaching to the age of 14 was about 30%


Are you saying that Adam Smith's writings was representitive of the views espoused by all the American framers and philosophers of that era?

How does the survival rate of someone who has reached the age of 14 have an effect on literacy and citizenship?


Here's your original point:

> It was understood that the main purpose of education was not to create factory workers, but to have critically-thinking and informed citizens in a republic

Are you saying the seminal book in economics documenting at the time of the Declaration of Independence that having children in the Western world was to help you get rich (opposite was going on in China) was incorrect?

> How does the survival rate of someone who has reached the age of 14 have an effect on literacy and citizenship?

It doesn't, but when your literal survival is against the odds and you're task every day is to maintain sustenance, I'm not sure your comment about a whopping 99% rate literacy hold water.


> Are you saying the seminal book in economics documenting at the time of the Declaration of Independence that having children in the Western world was to help you get rich (opposite was going on in China) was incorrect?

Leaving aside whether I agreed with that point about children being there to make you rich (I don't), or whether everyone in America agreed with that (I doubt it), and we're just looking at the various colonists (excluding the Natives) making up the 13 colonies at the time of the Declaration of Independence, I don't know if that would be considered the seminal book to the point that it influenced how education is viewed. I see (at least according to Wikipedia), it had influenced Alexander Hamilton, but I also think Hamilton in many ways was ahead of his time. It is my understanding though, that those ideas become much more commonplace in the mid- and late 19th century.

> ... when your literal survival is against the odds and you're task every day is to maintain sustenance, I'm not sure your comment about a whopping 99% rate literacy hold water.

So I am to understand that you are saying, because conditions are so harsh, there is very little time to do things like studying or reading?

A curious thing happened in the Midwest in the early 1800s. Land was divided in a way where schools and colleges were deliberately set aside so that children would have access to it. For every N plots of land, there would be a school; for every M plots of land, there would be a college. I don't think any other region of the US was divided like this. The educated farmer, at least in the Midwest, is a thing.

That bit came from an article by someone observing that the Midwest seems prototypically boring, without characteristic. They were trying to explore just what makes the Midwest the "Midwest". The essay was not written as a criticism of the education system.


> These zoning laws were originally created as a way to get around federal laws prohibiting discrimination of race and sex by making it more difficult for people who can't afford housing to live within a certain neighborhood.

I'm not from the US but I'm just not sure I'm reading this right, you say these zoning laws are literally racist? And they're still around??


This is a good resource based on and linking to historical documents.

https://dsl.richmond.edu/panorama/redlining/#loc=14/34.021/-...

Note the description under population.

"Shifting or Infiltration: Negroes and Japanese increasingly numerous"

If a neighborhood had a couple of Black, Asian, or Mexican families banks weren't allowed to issue mortgages or other types of real estate loans. The US built a lot of suburbs post WWII those were restricted to white families only. Blacks, Asians, and Hispanics weren't allowed to buy and also were banned from receiving FHA Loans.

The current battle in the US politically is over whether to return to this state of affairs.


Exceptional comment.

I think your random sampling of people is just unlucky. It's not my experience the people living intergenerationally are unhappy. It's normal here in Asia. I know of no one complaining. It's very common to see 50s mom and 20s daughters spending days together as friends. Browse a dating site and it's not uncommon to see people even in their 40s living with parents. It's also not uncommon for people to move out for collage and move back in 4 to 10 years later with zero stigma

I have feeling you could make an argument that getting your own place is either an indirect or possible direct consequence of marketing. Lots of companies stand to make more money if they promote you moving out on your own. Ikea has at least one famous ad telling you to move out of your parent's house

https://www.google.com/search?q=time+to+leave+home+ikea


The economic incentives are the whole thing.

Had the US not participated the suburban American dream, the excess WWII capacity would be wasted instead of being redirected to home construction, auto manufacturing, and all manner of new industry. And we would’ve plunged into yet another depression.


This matches my experience that children of immigrants from intergenerational living cultures choose to live separate from parents if they can afford it.

No one makes compromises unless they have to, and unless you have a big soundproof house, two or more couples living together are going to bump into each other.

I see older parents moving back in with kids due to declining health, but otherwise the consensus seems to be that having grandparents nearby in a separate home is ideal.


Not saying that fitting people into a small space isn't hard.

However, children of immigrants are especially keen to assimilate into the receiving culture, so much so that they often go beyond what natives do. For immigrants and their children, a clash of cultural values may be a larger driving factor than what's the natural for people in general.


Having your family under one roof isn't a compromise, unless you don't like your family. Sure, there are downsides at times to having everyone together, but the positives far outweigh the negatives.

Even if you like your family, I would be surprised if you didn't make compromises regarding noise levels during different times of day, cooking choices, having people over, etc. Not to mention cultural differences.

The above might not apply if you have a large enough space with sufficient sound proofing and multiple kitchens, but that's not the reality for most people. There are positives, but my observations suggest that the biggest factor in determining if you live in an intergenerational household is whether or not children and the parents can both afford to live in different houses.


I would agree on one point and disagree on the other actually.

On the first point, from what I've seen, there is certainly a lot of conflict if intergenerational couples stay together under the same roof for prolonged periods of time, whether it's the parents living with the kids or the other way around. For short periods of time, it definitely works out positively.

I would argue that it's less because of wealth or even expenses, and moreso because of cultural norms, that children tend to stay with their parents for longer in Europe. I don't know if this comes across as anecdotal, but my SO's parents often requested her to choose a medical university closer to home, and even suggested we stay with them, even though they are extremely affluent and comfortable. Even now, after living separately in another city, her parents and relatives often stop by to check up and stay for a couple of days very often. Of course, the young will always prefer to move apart to retain some privacy, especially once the kids arrive. Obviously there's the shadow of European expenses hanging over everyone's heads.


It's not even necessarily a Europe thing. Or Asian. Though yes there are these tendencies. Italians, even in the US (North America actually) from my experience tend to stick together as a family unit for a long time. There's a lot of pressure on the young folks as well in some cases I know. Every situation is different in its own subtle way but I can definitely see how necessity (money) has made it so that kids stay with their parents until they're married. Catholicism will play a role too. Seeing that in many Spanish friends as well. Both the money and religious aspects. Germans too. I have a good childhood friend (yep I grew up there) who was always very close to his mum and built his house right next to his parents house for money reasons (free land so more money for the house). They are just constantly fighting over this or that. His SO really hates it now. I never understood why they did that. Sure, be in the same city, maybe even same neighborhood but right next to the parents especially after marriage? You're crazy! Same household? Way beyond crazy!

Personally I have healthy 6000km between myself and the parents. To be honest something like the 300km we had a some point is nicer and for taking care if the kids from time to time something like a few kilometers is best but same houseld is just stupid and I have yet to meet someone (even Asians) that will willingly do that for longer than necessary if they can help it. If they do it, it's for one of the reasons stated above like a Vietnamese colleague who did move back in with her mum for like a half year while trying to find a new place. They're close but same household is just way too close.


> It would seem to me that it's most common in the US to move out because they can afford to...

In the context of the "housing affordability crisis", it makes that part of the context that much more interesting.


> While it's true this seems like a strong US thing, I haven't heard many happy long-term stories of folks living intergenerationally.

That's really depressing. I'm sorry your social circle has such poor family dynamics. The majority of inter-generational families I know quite like the arrangement. Grandparents love having grand kids around, parents enjoy the extra help of the grandparents, meals are a lot more fun, etc.


>The idea that having a multi-generational household means that the younger members haven't "grown up" and need to "learn to live on their own" is a completely manufactured attitude. I think many American families would have much stronger, more healthy inter-generational relationships if we lived together (at least for a bit) as adults. As it is now, most US kids leave home just when they're starting to be able to meaningfully contribute to the household as equals.

There's more to it than just learning to live on your own. In the US, we value individuality above all else. People who never move out and forge their own path in life are far less likely to find out who they really are and what they really want out of life. Whether you're aware of it or not, staying so closely attached to your family can massively stunt personal growth. You are constantly reminded of who and what you are "expected" to be, rather than defining that for yourself. You can see this very clearly by going back to your hometown and talking to the people who never left. Sure there's value in the stability and comfort of that life, but you lose out on the opportunity to truly express yourself and be who you want to be.


You're projecting yourself onto all other Americans here. Personally I feel the same about some points:

I moved back to my hometown after finishing college (in Germany!) and went to work at the family business. I was there for 4 years, and miserable for 3 of them. I finally told my dad that I didn't want to work there anymore, and it hurt his feelings for sure, but the last 10 years have been much better for me.

At the same time, I still live in my hometown and I find that the "get out" mentality in high school was massively overhyped. I like it here. My younger brother eventually went to work for my dad, and he seems to like it.

I'm just trying to say that just because you believe living with your parents would stunt your personal growth, doesn't mean that your neighbor can't live a perfectly happy and successful life in that situation.


In america, there is a difference between just living in the same town as you grew up in (not a loser) vs. a room in your parents house because you can't afford it.

I was fortunate enough to be able to attend boarding school starting from age 13, and getting out of my parents' home early was a huge benefit in every possible way. I wish more young people had the same opportunity.

My parents are good people, there was nothing wrong with my home environment. But it's more important that youth learn to act like independent adults and take responsibility for their own lives. Staying at home too long causes learned helplessness. When there's no one around to help it's sink or swim.


I think whether youth learn to be independent adults when living with parents have more to do with parenting style than with the fact that they are living together. Helicopter parenting styles can lead to learned helplessness even when youths are out in the world by themselves, and they end up continuously being a burden to friends and family in order to survive.

I moved out at 18 while working full time, I have always been extremely independently minded and wanted to do my own thing. Was it extremely tough especially when I was going to college as well? absolutely! But it brought to me a sense of independence and tenacity that has given me a huge advantage over peers in my age group. Everything is not that difficult when compared to being on your own at a young age. I counter this to a person I knew who went to a top school who's Dad was a corp. exec and they were not working/jumping between low level jobs into their 30's and were completely dependent upon their parents weekly income. I cringe at the thought of moving into my parents house again, I love them alot, but just value my independence alot more.

I had a similar experience. I moved out at 19 years old, in my own apartment, with no financial help from my parents (beyond 2-3 home cooked meals a year).

It might not be the same for everyone, but for me, there was a definite pride in being independent, making my own decisions and having nobody to answer to but myself.


Boarding school was not sink or swim, you had adults looking after you, likely it was paid for by your parents, and you had a decent home life to return to if shit got really tough. Most parents aren't going to let their child sink and drown, nor is that really practical advice.

There’s a big difference between a parent and the adults in charge at a boarding school, in terms of the emotional support and things that those adults will do for them.

I’m sure most 13 year olds plead with their parents to take them certain places or buy them certain things (e.g. specific food and clothes, etc.), and while I’ve never been to boarding school, I imagine you have to figure out how to get things for yourself.

The point is taken re: not being “sink or swim” (you won’t be left on a ditch on the side of the road), but surely it’s obvious that more independence is needed living without a primary caregiver in the same home.


It likely depends on the country, but I am sure there is no lack of pampered/spoiled children at boarding schools. In the US, where free boarding schools are practically unheard up, it is even more likely.

The adults should be ensuring you don't grievously injure or harm yourself, and that you're returned in same/better condition.

You can always ring up your parents and ask for stuff, it's not like you are adopted by the school and lose all contact with your parents, nor are you earning a wage at 13 going to boarding school.

Lots of kids going to public school and/or with rough home lives learn "sink or swim" just as well or better than someone going to boarding school. I just found it odd to say you're learning to "sink or swim" when you have so many safety nets there to catch you if you did sink/fall.


One of the value propositions of these boarding schools is that they don't put up with your kids crap and your kid hopefully doesn't become a spoiled brat.

It's perfectly possible to do that while living at home.I was more independent at 13 than many 20-somethings I met years later living in a shared flat.

I also went to boarding school at 13. I wonder if just giving your kids more freedom would have a comparable impact.

So you're acknowledging the possibility that some might sink?

Our mother in law is staying with us due to the unexpected passing of her husband, and we have been experiencing this first hand as we look for a shared home.

Not only is there no multi-gen homes in our area (exurb an hour away from a major city) but it's difficult to find a layout where a part of the house can be a mini apartment or her own personal area. It seems like more basements are finished now and some of the design decisions have been quite odd to say the least.

Worst of all is that we're not allowed to buy some land and throw a small structure or trailer/rv on it for her. Even though it's for family it's not allowed as it could be rented out in the future.

The entire process has been stressful and aggravating, and is made worse by everyone sharing the same space working and going to school.


Some regulators have different rulesets for 'temporary structures' (whose permanence can be fuzzy), for 'extensions' (whose connectedness can be limited), or 'renovations' (whose alteration vs. new-build can be gamed). Work the system. Worst case, put up a glamping tent and go neo-Mongol.

On the glamping line of thinking, I've seen some families around here use an RV as a mother-in-law apartment. They are a bit expensive right now, but still way cheaper than full renovation to add the same amount of space. Plus, then you have an RV.

It's not all dumb cultural expectations. It's hard to chase opportunity & follow the work if you don't leave home.

In the US it was also a consequence of affluence and lots of living space. A lot of social progress comes when a new generation doesn't have to live within the expectations of the previous generation. The parts of the US where there is a lot of wealth creation are the parts of the US where a lot of young people move to.

So, without making any judgements about how people want to live their lives, I think it is a negative for the US that more young people are living at home.


Even though I agree it is more of a western thing, I would argue it is also maybe more of a "recent" / urban trend. I am originally from rural Western Europe and a few years ago grandparents, parents and kids all in the same house was still a common sight. I would agree that people look for more independence these days but I feel like in some places it is still fairly recent.

Definitely a western thing, but actually commonplace since 1200s in England.

Correct. Neolocal households coupled (no pun intended) with later marriage ages are unique aspects of historical marriage patterns in northwestern Europe.

https://en.wikipedia.org/wiki/Western_European_marriage_patt...

Many more regions besides England have also shown this pattern for centuries, but those are mostly within northwestern Europe to the west and north of the Hajnal line.


How does it work in practice in other societies?

How do you have a grown up, likely physical, relationship with your partner... when your parents are sharing the same rooms? Do you just hide in your bedroom the whole time?

How do you develop your own relationships and life and way of doing things and way of raising your children, inside someone else's house? I can't understand that but I'm open to hearing about how.


Seems like you are referring to sex. Obviously, when you are living in multi-generational households, you can't be having loud sex on the kitchen table. You can either do it quietly in your bedroom, or use the Asian practice of going to love motels when you want to let the monkeys loose.

Regarding your second point, I'd like to point out your particular phrasing which makes clear your point of view, that you consider a multi-generational house "someone else's house". It would be your home that you are living in, even if it is not your name on the deed or rental agreement. Now, whether you can develop your own relationships and life and way of doing things has to be independent of whether you are living with family. For every person that is an example that living with family is a burden, there surely is another example where it is a benefit. The growth in your relationship with your family can be hindered or accelerated by your time with them, I don't think there is a one-size-fits-all answer to that.


> How do you develop your own relationships and life and way of doing things and way of raising your children, inside someone else's house? I can't understand that but I'm open to hearing about how.

In my experience what happens is that the "family" raises the children.

In intergenerational households - in Asian cultures at least - it is still generally the older generations calling the shots, in patriarchy/matriarchy sense. In practical terms it depends on how much financial power each generation holds that determines how much say they have. But in Asian cultures age do grant at least some implicit authority.

Given the above cultural context, tensions can arise if the way of living/child-raising are not aligned. I would say this resolves how normal conflicts get resolved. Those who have the most time and influence usually win out. Although culturally people understand they have to pick their battles for the benefit of daily harmony.

I think a way to think about how the living arrangement works that may be more relatable is to think about a multi-generational family business. If you watch shows like Chef's Table there are stories were children take over the family's business by more-or-less following in a prescribed footpath, while others conflict and find that they have to strike out on their own.

On a day to day basis though, it's just like living in a very close knit community - you could say a family.


> In intergenerational households - in Asian cultures at least - it is still generally the older generations calling the shots

I think this is the simplest answer to why most people are opposed to it - they fundamentally don’t want anyone else calling the shots on their lives to any extent.


Argentina solves this with "telos" https://es.wikipedia.org/wiki/Telo

How is this different from the Asian-style "love hotel"?

https://en.wikipedia.org/wiki/Love_hotel


Yes, I suspect that people moving out when they are 18 is an anomaly, due to a special time of increased prosperity, and the recent events are simply just the start of a return to the norm.

This would not be a sustainable model for a capitalist market.

Spot on. The absurd nuclear family culture it's a product of the car and real estate marketing efforts.

It's also completely against human nature, especially when it comes to raising kids. We have always lived in large groups and kids were nurtured by and brought up by many members of family, instead of just father and mother. It results in much healthier humans, who learned from all members of family, because who's to say that father and mother themselves only are best guardians? Not to mention the sheer amount of effort required to take care of a child, which was shared by much larger extended family or just tribe members. Today's nuclear family mostly brings mental issues and overburdens the parents in an unnatural way.

>> In other parts of the world it's abnormal for adults in their 20s to be living anywhere but with their parents, often even with a fiance or new spouse in the mix.

The difference is the prudishness of US culture. Those couples are living life as a couple. In a US household they would be treated as kids, with many parents not allowing them to even share a room.


I agree.

I don't like what the title tries to suggest that living with your parents is something wrong/abnormal?

Why is that? I understand for many it is not a choice, but it doesn't necessarily meaning people are suffering as a result.


Though I agree that it's not wrong or abnormal (at least for most of the world), in this context it represents a pretty large economic step backwards. There was a time in most middle aged people's memories where starting a career, affording a house and starting a family were all realistic goals in your twenties. Now that's not possible for many, even as economic indicators like GPD, the stock market, inflation, etc. improve. This statistic simply reflects a growing income inequality and corresponding quality of life decrease.

I doubt think this has been true for most of history. Rather usually one lived and worked the farm with the family. Then it got subdivided as more children survived childhood, at least until the birth rate declined.

There has been golden eras, usually from expansion or industrialization where youths could acquire their own places relatively young. But it doesn't scale forever.


I don't think it is about it being wrong (though it is abnormal in the US context), it is the reason for this shift that is worrying.

Is there any reason to believe this is due to a cultural shift amongst Americans? I don't believe it is controversial that the young have been the most negatively impacted by rising education and housing costs, as well as their demographic being the most heavily impacted by the Covid-19 pandemic. (is it?)

The implication here is that more young adults are staying at home, not because they want to, but rather because they cannot afford to leave (or in some cases, as the article mentions, because it is better than being isolated at home alone). I hope you agree that this is an important distinction.


The American status quo is based on around individual independence and for better or for worse anything that moves away from that is considered a regression.

Well - it's abnormal in that it is not what the US's coming-of-age systems look like. Hit 18, move out, get a job. Whether that is good or bad or right or wrong is irrelevant, it's definitely abnormal from a cultural standpoint.

Yeah, there's definitely a cultural aspect. People WANT to get out of the house ASAP. It's not like all of those American 18 year olds are bummed that their parents expect them to go someplace, it's that many/most of them are chomping at the bit to have their own place and their own life with day-to-day financial and social independence from their family. If they're more likely to be staying home now, it's a sign of financial trouble because presumably most of them would love to go someplace else but can't.

To the degree that there's a stigma associated with adults living with their parents in the US, the stigma comes more from being the sort of person who would want to live with their parents when they could afford to be on their own. That's the stigma. It's not a stigma about poverty, it's a stigma about someone who would want a more sheltered and less independent life, and a stigma about someone who wouldn't get seriously annoyed at having their family around 24/7. Those are both pretty alien concepts to a lot of people in the US. There's also the rule of thumb that the #1 way to keep a family together and loving each other and constructively involved in each other's lives is to not see each other every day. Absence makes the heart grow fonder, and all that.

But like you said, this is independent of it being good or bad or right or wrong, it's really just cultural context, but that's the cultural context.


I would like to add to this that it's definitely not unique to the US. Growing up in Eastern Europe the attitudes of young people around me were very similar - you want to get out of the house ASAP. The age threshold would be somewhat higher (maybe mid-20s instead of 18), but overall trying to become independent and self-reliant was considered a virtue.

Agreed. I wish that the stigma would go away, but not because of mass financial instability. I wish it was just more of a culturally acceptable thing to do - it'd be easier to start a life at ~25 or so after a few years of working and creating somewhat of a nestegg.

in the US, living with your parents after high school implies you need their support financially when you're old enough to have a job of your own.

Usually any mention of living with your parents implies being lazy ( the whole "neckbeard living in their parent's basement" stereotype ) unless you qualify it with "but I pay rent". If you pay rent then it appears more like you can support yourself and still not relying on mom/dad to pay your way even in adulthood.


> The majority of 18- to 29-year-olds in the US are now living with their parents

The title doesn't suggest anything, it just states an objective fact.


Now imagine all the human stories that are forced into this situation that aren't heartwarming.

You mean all the entirely predictable situations, like guaranteed increase in sexual abuse and domestic violence? When this genius plan was announced in late winter, I couldn't help but think of all those poor souls who lost whatever safe space (school, library, job, whatever) they had that kept them away from an abusive person in their lives, who were now together 24/7 under psychological and economic stress. Of course, the spirit of moderation requires that we consider both criminal incompetence as well as sociopaths with grand visions for the "betterment" of humanity and our planet, as an explanation as to how we ended up like this.

[p.s. one fine day, the internets will unequivocaly sing the same song, with not a single person suffering from misunderstandings. That fine day, HN will do away with anonymous downvotes, since we will be in a state of perfect harmony.]


I'm not sure why you were down-voted so much. There are real negative consequences for a State-wide lockdown that aren't immediately as obvious and the consequences of not locking down. I'm curious how in depth that analysis/discussion was, or if everything has been just knee-jerk reactions to the latest news and data points.

I'm a foster parent and have seen a lot of the discussion and tweaks among CPS and social workers in my state because of that. A shit ton of analysis and discussion has gone into every step here. People who act like they are the first person to ever think of the downsides to a lockdown are just not relevant.

I have friend who immigrated to the U.S. when he was in his teens.

After graduating college and finding a good job, he went to get a roommate and move out. His parents were horrified. "Why are you going to move out of your family's house so you can pay money to live with strangers you found on the internet?".

At first we all laughed because it seemed like a case of immigrant parents no getting how things worked here, but the more we all thought about it, the more the parents seemed to make an excellent point, and one none of us had really considered.

Not sure when families living together became a sign of failure rather than a sign of a close family.


Coronavirus ironically has been great for family bonding for us. We spend half our time at my parents house (who live 10 minutes away). Between four adults it’s much easier to take care of the kids, and my parents are retired and love the company. And we also enjoy spending time with them: I’ve gotten to talk to them much more than I have in a decade.

Agreed.

I moved back in with my Dad with my husband. I'm 32, hubby is 30. He had two strokes and my little sister didn't want to be the only one nearby. It's been 6 months. Is it the easiest? No. But it's amazing to have this day-in-day-out time with my Dad again after not having lived at home for years.

My older sister moved back in with her husband and two kids for 2 months as she studied for her medical school USMLE exams so she could take advantage of the free baby-sitting.

Neither my sister's family or my own would've made this decision without the pandemic. My husband and I were both pushed remote (same salary) and my sister's child care plans went up in smoke.

While 2020 has been shit, moving home in some cases isn't an indicator of a problem. It's just a smart reaction to the new reality of working from home.


That’s cool and all except the part where it’s literally illegal to build housing suited to this arrangement in many places, like in the majority of the land area of San Francisco: https://sf-planning.org/sites/default/files/FileCenter/Docum...

I'm my early 20s and in the UK. I earn more than my Dad who is in his 50s. He managed to get a house, have money left over for an expensive hobby, decent car, the odd holiday etc.

I'm a 90th percentile earner. Will 95+ percentile earner in a few years time. Yet it feels like I am not as well off as I should be. I don't live in an expensive area either. Yet I need to save so much money to even have the opportunity to buy a house. Then I also need to save a tonne of money for a nice retirement as government pensions get absolutely gutted.

I'm not going to pretend I won't have a good amount of disposable income even after maxing my pension contributions and paying a mortgage. But it just annoys me that I'm a relatively high earner and yet the money won't go very far. The most expensive thing I'll ever buy would be a brick box, and one that's not even as good as my parents.


I’ve thought about this a lot. My parents had 2 TVs in a house of five(and one was junk). We had stick on vinyl floors, and a cheap white appliances. Counter tops were linoleum, and we had 1.5 baths. I cut the lawn, and we went shopping in stores. We took two vacations requiring planes for the first 13 years of my life. Most vacations were camping. We rarely went out to eat. We didn’t have computers. We had 1 corded phone in the house.

This is in stark contrast to my house. We have two iPhones and get new ones every 2-3 years. We have two iPads, 3 computers, and gadgets galore in a house of 4. My countertops are stone, my appliances are stainless. We go on vacations yearly that require planes and hotel, and used to eat out often. I have a house cleaner, and pay for an expensive gym.

I realize I may not have the house my parents have, but I have nicer things. I make more money but I spend it very differently then they did. There was basically nothing we bought that compares to an iPhone every 2-3 years. I know so many people who travel regularly, and don’t seem to realize this was rare 15 years ago. I really feel we spend our money differently.


I mean it sounds to me like you're just wealthier than your parents were, but housing has risen in price disproportionately and so the things you buy are different. Would you really be purchasing a house if you didn't buy a phone every 2 years? The things you list sound like, idk, $10k/year with some heavy assumptions mostly weighted on the vacations than the tech. It's likely true there's more premium goods at (higher) affordable prices, but that doesn't actually contradict the narrative that housing has gotten a lot more expensive.

I say this as someone in the same boat, who could/would/will casually afford to buy an expensive home under 30.

The median net worth of millenial families (35 and under) is $10k. Probably trends negative if you filter down to people below age 30 only.


My takeaway from his or her comment was that housing is expensive because it’s nicer.

And it’s true. It is hard, if not impossible, to find a modest, small house. The median size of new construction is more than double what it used to be. And houses are full of glitzy appliances, fixtures, moldings, and counters. It really does just heavily inflate the price.

How much would a 1,000 square foot house with modest fixtures cost in your neighborhood, if it existed? That’s what the typical house used to be.


Eh, not really

> It is hard, if not impossible, to find a modest, small house.

True, but small condos have seen similar appreciation

> houses are full of glitzy appliances, fixtures, moldings, and counters. It really does just heavily inflate the price.

This do increase the price of real estate, but not that much relative to the bigger picture. The price of a "glitzy" fridge vs. a non glitzy fridge is going to be what, $500? $1,000? Likewise, appreciation has occurred on older properties without these features unless you're below the inflection point where the risk of the property declining in value faster than the market appreciates is so high that the price remains poor.


A sizable percentage of people don't want to live in condos. And they aren't necessarily small, either.

>This do increase the price of real estate, but not that much relative to the bigger picture. The price of a "glitzy" fridge vs. a non glitzy fridge is going to be what, $500? $1,000?

That's an extreme understatement. A glitzy refrigerator might only had $500 but marble counters might add $20,000 or more. Same with flooring. The price difference on a house full of stick on vinyl and real hard wood might be an additional $20,000. Then you get to other cosmetics such as crown moldings, jacuzzi tubs, walk in showers, vaulted ceilings, heated towel racks, and more. You could take the exact same house structure, and through flooring, counters, and cosmetics alone you could easily jack the cost up by $60,000.

>Likewise, appreciation has occurred on older properties without these features

Not really. Houses get upgraded with better floorings, better counters, additions, and other renovations. Go find a house in your neighborhood built in the 1950s with no major additions, laminate counters, and cheap flooring. Good luck.


> A sizable percentage of people don't want to live in condos. And they aren't necessarily small, either.

Most condos are small. If a sizeable proportion of people don't want to live in condos, that would make them cheaper. The fact that they're appreciating similarly that is further evidence that the premium for size is not the driver of what's happening.

> That's an extreme understatement. A glitzy refrigerator might only had $500 but marble counters might add $20,000 or more. Same with flooring. The price difference on a house full of stick on vinyl and real hard wood might be an additional $20,000. Then you get to other cosmetics such as crown moldings, jacuzzi tubs, walk in showers, vaulted ceilings, heated towel racks, and more.

Most properties don't have jacuzzi tubs or vaulted ceilings. You're not wrong, but they're not relevant to the discussion of what's happening to the median home buyer.

It's nonsensical to think that the price of housing has risen primarily because of quality increases because many, many houses have seen large appreciation with no changes.


> It's nonsensical to think that the price of housing has risen primarily because of quality increases because many, many houses have seen large appreciation with no changes.

So it should be absolutely no problem for you to take me up on my offer. Locate a home, built in the 50s or 60s, without any additions adding square feet. Cheap counters, cheap flooring, and cheap fixtures. If what you say is true this should be relatively simple.

How much is it, and how much more or less expensive is it than newer construction in the area. If homes are just rapidly appreciating while they sit there unimproved, this should be a trivial exercise.


My parents bought a 1400 sqft, 1950s-built home in 1993 for $350k. It still has all old appliances such as a 1950s oven that looks like this [1], old gas heating vents, no central cooling, no pool. No additions. The fixtures and flooring aren't cheap, but they're not luxurious, and are over 60/70 years old at this point - only real maintenance they've done is re-shingling the roof and repaving the driveway every decade or so.

The house is now worth $2.1M (+500% gain). Obviously if they sold a new buyer would tear the whole thing down and build some huge modern home on the land (which is the actual valuable portion of the asset) as has been happening in their neighborhood.

You are placing way too much importance on the relatively small value of fixtures and "nice" amenities vs. the global glut of capital chasing appreciating assets (made much easier through online platforms) such as land in desirable areas.

[1] https://www.oldhouseonline.com/.image/c_limit%2Ccs_srgb%2Cq_...


I think that people ignore the fact that the population of the United States has dramatically increased over time. We now have 331 million people whereas there were only 210 million in 1970. So of course housing is going to be more expensive. The issue gets even more dramatic prior to 1900.

The USA has half of a continent to house all these hundreds of millions. The problem is with overcrowding in larger cities, not the lack of space (even if the location is suboptimal).

NOne of us should feel compelled to crowd into large cities anymore. NOT in the 21st century, and CERTAINLY not after we've clearly demonstrated as a workforce that we can very easily get our jobs done remotely. Sure, that's not for all workers, or even most, but a huge proportion of us could very easily move to small towns all across america to relieve the crowding pressure in cities or the most trendy suburbs.

IF and ONLY IF: employers join us in the 21st century, and embrace remote work where they can.

(and the real danger, as I learned in the 1990's, is not even being remote - it's being "not at the home office" of a distributed organization - it is a career killer, and when that "business cycle" inevitably hits, your remote-office workers are always the first to get cut. This shit has to stop if we're going to get out of this "crowded into cities" nightmare).


We spend it differently because supply and demand (yeah, duh), but what I mean is that we make about the same as our parents, but the cost of housing went up, while the cost of travel and electronics went down. So we buy cheap stuff while try to figure out what to do with housing (and healthcare, and so on).

Everything that requires local labor is very expensive (partly because our expectations and requirements increased, we are willing and able to spend more, so a very high equilibrium point formed), everything that can be mass produced is cheap. (And not just because externalities are hidden, but because technological progress.)


Your countertops or your landlord's countertops? Because all the rest - all those iphones & vacations - is cheap fluff, really.

That's the point. The cheap fluff today was expensive stuff yesteryear, if it existed at all.

Seems like the ol' "poor people aren't really poor because they almost all have refrigerators and not even kings had refrigerators two hundred years ago!" argument.

I call the counterargument "You can't live on pepper". As in even though pepper is way cheaper than it was 500 years ago, you'll starve if that is all you can afford.

A good thing is still a good thing. And for the vast majority of Americans, we aren't talking about starvation, or even homelessness.

With tens of millions of Americans facing food insecurity and tens of millions of Americans facing eviction now, thanks to years of precarity exacerbated by the COVID-19, I think the situation is worse than you're suggesting.

The counter to your strawman is that you are poor if you feel poor.

Since we have proven that a majority of people feel poor (i.e. they need to earn 20% more), and that this is true even of millionaire’s, we need a different definition of poor, because something isn’t right here...


Yeah, because real poverty doesn't exist in this country right? It's all just about feelings!

https://www.theguardian.com/us-news/2017/sep/05/hookworm-low...

> The average income is just $18,046 (£13,850) a year, and almost a third of the population live below the official US poverty line. The most elementary waste disposal infrastructure is often non-existent.

> Some 73% of residents included in the Baylor survey reported that they had been exposed to raw sewage washing back into their homes as a result of faulty septic tanks or waste pipes becoming overwhelmed in torrential rains.


I’m not sure how cheap that is overall. For example an extra $400 a month is $100k in mortgage loan right now. It all adds up, and is easier to do if you avoid the wasteful spending.

This is an excellent point - I think we are definitely a generation of consumers, and what happens is, kids who aren't taught how debt works get caught up in it.

And once you're caught up in debt that extra 400 doesn't go to a mortgage it goes to that credit card or that high car payment on a 72 month term..


I’m in my mid fifties and I have never had a company pension, defined benefit or contribution. I saw my first house decline in value by 25%. We had interest rates peaking at 15%. I didn’t have student loans but only because I didn’t go to university, just like 90% of my peer group. Unemployment was much higher than it is now and schools were teaching subjects for obsolete careers.

It wasn’t as rosey as it is often portrayed.


I think you're missing how pervasive & broad the issues are these days.

You mentioned you had a house. I'm fast approach the top 1-2% by income and think I can maybe swing a 1 bed apartment. It'll be borderline. Not house...apartment.

...no idea what the other 98% of my peers are doing but they sure as hell aren't buying houses. Meanwhile all the landlords I've rented from thus far where a generation older and had entire portfolios of properties.

Pretty sure I'll come out on top of this because I'm doing well, but can certainly understand the disillusionment of the younger generation


Note that millennials only have 5% of the US wealth.

The boomers passed laws to help raise their pensions and lower their taxes. The young are paying for it.


The 0.1% passed those laws.

Then they blamed robots, immigrants, demographics and boomers.

"The can kicks back" wasn't bankrolled by a millenial, after all.


Sorry, I should have been clearer, it was an apartment.

Then you must be living in a really expensive city.

Yup. London. In the land of limp pay cheques (compared to US).

Financial sector means being in a financial hub though so not much choice.

I'll probably end up moving further out and accepting a long commute eventually.


Why are you shocked you can't afford a house if you live in one of the most expensive cities in the world.

My parents grew up in the "golden years" of the 60's and they couldn't afford it either. That's why they moved to a small town with cheap housing.


Expensive cities have most of the jobs.

There's a reason Pittsburgh's population declined by the hundreds of thousands since the 1970s. Sure you can get a cheaper house. But you aren't making coastal money.

In the 60s those "small towns" had manufacturing plants you could just walk in and get a job at, many of which were union and paid extraordinarily well.


It's not an "either or". There are mid-range cities, with jobs and affordable housing.

As many jobs as there are in SF, LA, NYC, etc, they don't comprise 100% of all jobs.


These mid range cities are not as agreeable as you think. I live in one. Housing is very expensive W.R.T income now.

The reason many of these places have cheap housing is largely because of abandoned neighborhoods, vacant lots, condemned housing, ancient housing which requires A TON of work...the neighborhoods people want to live in are pretty expensive still.

Not to mention the old school mentality and opportunity cost. I left one of those old school firms. It was 8-5 everyday, no variation, no flex hours. No vacation in your first year. No comp time for travel. Expectation of working additional hours. Poor yearly raises, etc. Small job market = small network = less salary jumps.


So it sounds like tradeoffs. Go to a big city, get a high salary, can't afford a house. Go to a medium size city, get a lower salary, can afford a house.

I'm not surprised there is a utopian city where salaries are high and housing is cheap.


The tradeoffs aren't worth it.

That's why people left Pittsburgh en masse and other cities have larger populations. Ultimately if it didn't make sense to go to big cities people would stop because of the costs - clearly the market says it's worth it.

Not everyone wants to live in the midwest with terrible food options just so they can afford a house built in 1940 with knob and tube wiring. These costs are never considered because people just want to say things like "lol move" without considering why people just don't move.


Yup, and there's a good breakdown here of the salary one must earn to be able to afford the median home: https://www.hsh.com/finance/mortgage/salary-home-buying-25-c...

There are a lot of options for everyone, regardless of which trade-off one chooses to make.


> Pittsburgh 3.70% -0.15% $149,830 +1.39% $835.21 $35,794.87

Yea if you want to live in a crap, run down neighborhood with a crappy school district and a house built a century ago that isn't code and will cost 50k to fix. I lived there - these statistics are nonsense. They don't tell the whole story.


I don't think I've ever seen someone so confidently attempt to refute data via personal anecdote, so bravo for that.

The median home is not always "crap, run down with a crappy school district". Yes, there exists a quality distribution, and the bottom quintile often has the worst quality, but that's true in every State and every Country.

This data isn't groundbreaking either, Zillow shows a comparable median home value in Pittsburgh: https://www.zillow.com/pittsburgh-pa/home-values/

Just eyeballing some CURRENT listings, you'll find:

On Zillow: A 3BR house in a top 10 Pittsburgh school district (Greater Latrobe School District) for $179K https://www.zillow.com/homedetails/34-Loretta-St-Latrobe-PA-...

On Redfin: A 2BR house in a top 5 school district (Hampton Township district) for $130K https://www.redfin.com/PA/Allison-Park/2695-Ginger-Ln-15101/...

These are perfectly good homes in perfectly good school districts.

Again, single data points only get you so far in an argument — but most importantly, the aggregate data corroborates it. Nobody claims that outliers don't exist, but we're talking about medians here.


I honestly can't help it but laugh. LATROBE. Latrobe is an hour away from Pittsburgh. Population? 7,885 (2018). There is nothing near Latrobe but St Vincent College. There are very few jobs. Oh and the commute? You take 376 E through the Squirrel Hill Tunnels. Easily a 2 hour commute. Sounds fantastic! Great pick!

Hampton is in Allison park which is a nice suburb. The median home price there is 295k. The house you selected is pretty small, 2 br, 1 bath, which makes a ton of sense - not a lot of young people looking for good jobs are going to want to live in a suburb with older people and families.

> Again, single data points only get you so far in an argument — but most importantly, the aggregate data corroborates it. Nobody claims that outliers don't exist, but we're talking about medians here.

But you cherry picked a value WELL BELOW THE MEDIAN IN HAMPTON. The median is 295k and rising fast. So tell me again, what cheap housing are you talking about?

Oh btw, unless you're lucky and at a FAANG (which have fewer jobs here) you ain't making anywhere near 6.

Go ahead, move to Braddock for that 50k house and breathe in the wonderful air from Clairton Coke Works and Edgar Thompson. I doubt you'd read that on zillow.


Again, I’m just playing by your rules — look up the top 10 school districts in the Pittsburgh metro area, and look up housing on Zillow and Redfin, it’s really not hard to find decent housing under $250,000.

> Not a lot of young people looking for good jobs are going to want to live in a suburb with older people and families

You’re moving the goalposts. You started off talking about school districts — not a lot of young people care about that. If you want affordable housing outside of nice school districts, and not in the suburbs, you’ll find plenty of that in the Pittsburgh city center, also.

The fundamental argument is that if you earn the median income, and you need to live in a good school district, it is more than easy to own a home and build equity in property — you just have to sacrifice being able to live near dim sum and access to “Hamilton”. If you don’t care about school districts, you can find a place with a short commute from work. You might even be able to get some dim-sum action. Trade-offs!

> Pretty small, 2br, 1 bath

Are young people looking for 4BR’s? I seriously think you misunderstand what the “median home” means — it’s not a McMansion. Also 2BR is large enough for a couple with one child.

> Go ahead, move to Braddock for that 50k house

Yeah but...you don’t have to do that. You can move to a far nicer neighborhood in the Pittsburgh area for $150k. It all depends on which trade-offs you’re willing to make given your personal circumstances. $50k is many standard deviations below the median, we’re not talking about that. You don’t have to be a FAANG engineer to earn the median income, especially at the household level.

> But you cherry picked a value WELL BELOW THE MEDIAN IN HAMPTON

No, I showed you the aggregate median home value in the greater Pittsburgh metropolitan area on 3 different sources now, and then made a cursory sweep of the current state of the housing market to corroborate the aggregate metrics. It was pretty easy to do. The data doesn’t lie. That’s far more than you’ve done in this discussion: un-verified personal anecdotes devoid of any citation or sources. It’s honestly pretty remarkable.


Why not move to SF or NYC if your in tech or finance?

> SF or NYC

That solves my property too expensive problem how?

More seriously...not super keen on living in the US to be honest. Could probably do it practically, but given my life circumstances it would be a net loss.


Well you would probably make $300k, so your income:price ratio would be more favorable.

Wait, how common are $300k salaries in SF/NYC outside of FAANG-level companies?

This forum isn't Teamblind.


The income:price ratio would be better if you only consider NYC/SF prices. If you also take in account the vastly lower prices in other regions, suddenly the ratio would become a lot more favorable in those other regions.

Not who you asked but because people have lives built where they are living and they don't necessarily want to move to an entirely different continent away from their favourite people and places even if they could be making more money?

Like if you want to do that power to you, but this seems like such an insane question to just ask a stranger on the internet given that there are very obvious reasons why a person might not want to do that


You say it like it's super simple...

I did it.

It's a combination of good jobs being in expensive cities, purchasing power dropping and epic (god I hate word) asset inflation.

That said remote work makes middle american and rest of the world post wuflu much more possible.

I wonder what will happen to big expensive cities after all the young people leave for the midwest and south?


Okay, but we’re you in the 90+ percentile like the OP? What happened to those that were in that range 30 years ago?

Everyone will argue with their own statistics, but I think your general sentiment is correct.

Everyone seems to think the oldies had it easy in the good ol' days and the youngens are a bunch of lazy good-for-nothins.

There are probably certain a ways it has gotten easier and others in which it is worse... But I think this is more about generational sentiment than actual facts.


thats not really true though, we have the numbers. In real terms, education, healthcare, and housing costs have grown at a much higher rate than inflation. It is more expensive to go to college, pay rent, and stay healthy now than it was 30/40/50 years ago.

Housing seems to be the primary issue, but you’ll find very little support for actually fixing the issue - more and taller buildings in densely populated areas.

I don’t think people have a problem with spending more on education, they just want a reasonable return on investment for it. Turns out pumping money into monopolistic schools doesn’t get you a better result


The olds don't want it because it decreases the value of their boomer bank account (houses) and being old, don't like change in general.

The boomer generation was more or less promised that housing was the key to social mobility. And it was for a large number of people. It's hard for that to remain true now, and there's a ton of negative externalities. It's not like these people were experts on real estate policy before, they just don't have perspective on how it differs for the young.

"Not liking change" is disingenuous, even if, broadly speaking, older people don't actually like change


RE: "unemployment was much higher than it is now" - I'm not sure what country you're in, but here is a graph of the US unemployment rate since 1950: https://fred.stlouisfed.org/series/UNRATE (unemployment was higher this year than any other period on the chart)

Unemployment in the US has been at its lowest (3.5%) AND then highest (14.7%) levels in 50 years, both in 2020!

https://www.statista.com/statistics/273909/seasonally-adjust...


UK, as per the user who I replied to.

Regardless, the U. S. had super-high interest rates at that time, too. 12% sticks in my head, but it was also the time of the Variable Interest Rate loan, where I watched co-workers really have to tighten those budgets and almost lose the house because interest rates went from "ungodly high" to "ridiculously high".

I think it’s good that you were able to own a house even though it lost in value. This ownership still sounds better to me than only being able to rent an apartment. Renting always means that the payments lead to 0% ownership in the end, hence a 100% decline in value.

> I saw my first house decline in value by 25%.

This rarely matters unless you are looking to sell or borrow against.

> We had interest rates peaking at 15%.

But inflation was higher at the time. Also rates are 0% now at the Fed level, but if you are a consumer you are going to pay a bit depending on your credit score.

> I didn’t have student loans but only because I didn’t go to university, just like 90% of my peer group.

The governments (it's really a global phenomena) pushed the general public into universities. It's hard to blame the students when you take that decision at a very early age 17-19 and most of these youth doesn't have any life experience.

> Unemployment was much higher than it is now

I highly suspect the current unemployment rate is meaningful. To be counted as jobless, you need to register with the local employment office. It's possible today's youth no longer rely on that and use modern alternatives instead.

> schools were teaching subjects for obsolete careers

They still are.

> It wasn’t as rosey as it is often portrayed.

It was not. The only difference really is land and housing which was significantly more affordable and did matter less where you lived. Now you need to live next to a "jobs-hub" that have insanely high rent and purchase prices.


If you buy a house worth 4x your salary (in the ballpark of average), a 25% decline in home value means you need to spend an entire year of labor just to break even, ignoring the obvious associated living costs. The decline doesn't matter if it's temporary, but they're not always temporary.

That sounds incredibly demoralizing.


On the other hand, renting an apartment translates to a 100% decline in value (and 0% ownership).

Renting is not a leveraged loan worth multiple times your annual income.

Home ownership may generally be better than renting. But home ownership and value decline is much much worse.


How old were you when you bought that first house?

Monetary policy is a huge factor in all this, asset holders are greatly advantaged over productive members of society at the moment.

The combination of artificially low interest rates with significant inflation in particular make housing spectacularly unaffordable. This combination simultaneously pushes up the costs of housing due to asset bubbles forming while reducing the ability of people who earn money to save for a down payment on a house.


I'm no millennial, but gen-X. My brick box is okay. Not as big as the one my parents had, but it's in a bigger city, which really adds to the cost.

But my wife and I are double earners, unlike my parents. And we both have really good jobs. We don't have it hard, but we don't drive new cars either; we've got a second hand Prius. The only sign that we've got it good is that our house in Amsterdam is not as tiny as most.

But I also wonder if maybe our expectations may be too high due to the constant stream of luxury lifestyles that we're being fed on TV, in movies and on other media.


I'm "X" as well and while I grew up it never occurred to me that owning a single tiny home would one day be considered a luxury. I was raised by a single dad who, on one tiny teacher salary ended up with two houses, all sorts of motorized "toys", financial security and a pension by the time he retired.

I probably make 3-4X what he did at the top of his career, and am kind-of hanging on to a house with a tough mortgage and a no-frills lifestyle. My Millennial and younger colleagues' financial lives are even more of a disaster.

I remember when someone reported that GenX was the first generation for a long time whose finances were expected to be on average worse than the previous generation. It looks like this trend has continued at least 2 or 3 more generations. It's not a blip, it's the new actual trajectory.


Assuming your father's peak income was in 1980, inflation has been about %315

With middle class incomes stagnated since about 1980, it's no surprise everybody feels a lot poorer now. They have a quarter of the effective income people in a similar position had in 1980.

that is not my understanding. how are you defining "effective income"

If everything gets 4 times as expensive but your pay stays the same, you can only afford 1/4 of what you used to.

Correct, but I do not believe that is the case.

I think both pay has gone up over time and tracked with inflation. I also think the things people are buying better and more expensive products than they did before.


expectations may be too high due to the constant stream of luxury lifestyles that we're being fed on TV

A vague quote comes to mind, something about the peasant classes of a few hundred years ago would have overthrown the ruling classes a lot sooner if they had any idea the luxuries the ruling classes were enjoying.

I.E., maybe what's happening is thanks to TV maybe we're finally understanding how good some of those on the top have it.


You live in Amsterdam... sorry to say, but that is privileged as hell. Housing prices are becoming insane even outside the Randstad (I’m a 95 percentile earner too) so if you own property in the Randstad and think ‘the only sign you have it good your house is not tiny’ - take off the horse blinders.

Like I said, that is the big difference, but it's also the only difference. And the fact that living in Amsterdam is so privileged is also not a good sign. It's not good if cities become ghettos for the rich.

And with Brexit, there's likely to be an influx of bankers driving house prices even further out of the reach of most people. Good for me I guess (at least if we ever decide to leave the city and sell; otherwise it just increases taxes), but I don't think that's good for the city.


Isn't that the whole point though?

Comparing a salary with a pension to a salary without a pension is insanity. Wages are not stagnant. They've declined precipitously. take-home pay is stagnant and pensions are dead.

And real-estate has been pumped so heavily with low interest rates that you either can't afford it or, if you can, you get to sleep with the knowledge that the music has a good chance of stopping on your watch.

Just for the record, I think "pension" in the UK means something quite different than it does in the US. A UK pension is (usually?) more like a US 401(k).

I'm confused. We both have pensions.

In the UK, they refer to defined contribution and defined benefit as pension.

In the US, pension is short for “defined benefit” pension, which is an annuity beginning at a specified retirement age. The liability for providing that benefit does not lie with the recipient of the defined benefit, but with the employer (or government).

A defined contribution pension is one where the recipient of the benefit owns and controls the assets that will be used to pay the retirement benefits, hence the recipient is liable for making sure to have sufficient savings and the right investments to be able to pay themselves in retirement.

In the US, social security is the defined benefit pension available to everyone provided by the federal government.

However, it is prudent to expect defined benefit pensions to decrease in value as the retirement ages are increased, and benefit amounts and future value of money are decreased due to slowing economic growth in most developed countries.


Interesting! Do they have a term for DC pensions in the US? Is that their 401k?

Yes, a 401k is one type of DC pension. Specifically, one subject to various stipulations of the tax code section 401(k), where an employer has to setup the plan in such a way that sufficient employees benefit from it in sufficient amounts to pass the non discrimination testing. In exchange, the income contributed is not taxed until it is withdrawn after retirement age.

A Roth 401k is the opposite, where the income contributed is taxed today, but the withdrawals are not taxed after retirement age (unless politicians change their mind in the future...)

An IRA (individual retirement account) is similar to a 401k, except it involves no employer, and the amount of income that can be contributed pre tax is much less, and maybe zero if you earn too much in a year.

A Roth IRA is like a Roth 401k.


Is his a final salary or other defined benefits pension?

> Wages are not stagnant. They've declined precipitously.

Do you have any data that support this?


Easy to find

https://fas.org/sgp/crs/misc/R45090.pdf

Real wages have improved for the top 10% and remained stagnant or declined for the lower bits.


The post-WWII generation were able to buy a house plus car/holidays/etc on one person's median working class salary.

It wasn't a particularly palatial house, but the mortgage would have been paid off before retirement.

But this is a direct consequence of a rent-seeking economy which uses property rights as a proxy for political influence. The British economy started being converted from an industrial economy to a patrician rent-seeking speculative economy in the 80s, and the result was massive asset price inflation in property and shares.

This wasn't an accident. It made a certain kind of person extremely rich, and most other people increasingly poor to varying degrees.

Unless there's a change in strategy - unlikely - you can expect the wealth concentration to continue in the UK, with increasing danger to the personal circumstances of any kids you have - if not to yourself if there's a serious downturn.

Even a 95%er is in danger of losing their property if they lose their job for an extended period if they don't live off speculative investments and rent.


>Unless there's a change in strategy - unlikely - you can expect the wealth concentration to continue in the UK, with increasing danger to the personal circumstances of any kids you have - if not to yourself if there's a serious downturn.

It's the same in the US.

>Even a 95%er is in danger of losing their property if they lose their job for an extended period if they don't live off speculative investments and rent.

I fear this the most. My husband and I make more money than the rest of our family combined (both mothers, both fathers, 4 adult siblings, their spouses), but I still feel uneasy about the future. Maybe everyone worries more during uncertain times, but being mid-career with savings/investments I never thought I'd be concerned about losing everything.


I chalk it up to things simply costing more. I make more than my dad did. I dont take any major vacations, go out much, or live in a McMansion, yet we struggle to save.As a kid we took lots of vacations, they saved a good amount of money (stock market was good for them) and are doing well for themselves.

I imagine it's only going to be worse for my kids.


> I chalk it up to things simply costing more.

Every price is an exchange rate. If things cost more, it's because your income gets less stuff.


My problem with "life" is all the... nickle and dimes...

$10 for Nextflix, $90 for Amazon, etc. On top of Gas, Electric, Phone, Internet, Car, Insurance, Gas, etc.

It's easy to watch the money flow in... and right back out.


This is the "Avocado Toast" argument that we're poor because we spend $10 on Avocado Toast.

It is totally false. It blames citizens for national structural economic problems like hidden inflation and like bad housing policies discouraging building/planning.

People spend $10 for Nextflix, $90 for Amazon, etc as short term pleasures because they cant spend $GIANT on a mortgage. What are you supposed to do? Might as well treat yourself.

Of course, I'd rather get a home, but if I cant afford it, I wont just sit at home staring at a wall.


>It is totally false.

It's false for some locations but not for others. I checked on the two homes I lived in growing up and both appreciated slower than inflation from the late 90s to the early 2010s when they were last sold. In real terms they are about 20% cheaper than they were when my parents bought/sold them.

Flyover suburbia is more affordable than it was 20-30 years ago. All major physical items are better and cheaper than they used to be. Netflix is cheaper and better than VCRs + rentals + expensive cable. The big difference is health care and college costs. But most people don't have huge medical bills and college is somewhat of a choice.

The cost of living increase is largely driven by California, NYC, and Seattle. Pretty much every where else things are cheaper than they used to be.


I dont quite agree. I dont think you can compare home to inflation only -- you have to also look at the income in that area as well as total cost. If incomes have also fallen, then the relative cost/income ratio may have remained the same (or as i'm proposing -- has increased.)

As an example, there are depressed areas in flyover states where costs have indeed gone down. But incomes have gone down even more -- they are once thriving places like Binghamton NY which had industries that have since moved overseas.

There is also the cost of healthcare, education, and retirement savings. My father benefited from a pension plan -- I have to save myself in a 401k. My father paid no employee premiums for healthcare, I pay about $900/mo for the family premium (before copays and coinsurance.)


It's not just in declining cities. One of those houses is in the suburbs of Chicago. It's true in basically everyplace outside of the ones I mentioned. You can find a SFH around any major city for 150-300k.

Healthcare is definitely eating up more of the budget. I'm open to the possibility that it's eating up so much more of the budget that it's making buying a house prohibitive, but the numbers I see don't back it up. Most people still have employer provided healthcare and don't pay 900 a month in premiums. Part of that is CoL. Your contribution are higher than my family plan premiums I got through the market place.


Chicago is only getting more expensive

The city, sure. But the surrounding suburbs are affordable

this is a variation of the "avocado toast" argument. if you go crazy and subscribe to amazon prime, a music streaming service, and several video streaming services, you're paying somewhere around $100/month. if instead you invested the $100 every month, you could expect to have an extra ~$200k (inflation adjusted) after forty years. that's not nothing, but it doesn't add a whole lot to your safe withdrawal rate in retirement (roughly $8000/year). if you're only able to save a couple hundred bucks every month, that extra $100 makes a big difference. if you're saving $1000+, your subscriptions aren't going to make or break your retirement; you need to dig into those bigger fixed costs to really move the needle.

We might be talking about different budget levels, but to normal people (people who don't have the word 'software' in their job title), 200k in retirement is a lot.

Actually the median 401k balance at retirement is only around 60k, so that alone would quadruple their retirement savings.


>> Actually the median 401k balance at retirement is only around 60k, so that alone would quadruple their retirement savings.

You are comparing apples and oranges. You are comparing today's values at retirement to future values at retirement. It is almost certain that $200k 40yrs from now will not be worth $200k in today's dollars. Inflation accrued over 40yrs -- however low and however faked -- is absolutely going to make that $200k seem not so much.

Presumably, some of the $200k invested will grow, but also, not all the 200k is invested right now, it drips in over 40yrs.

You also forget the wildcard of healthcare lottery. One large medical surgery co-pay and you lose half your nextegg.


I got the $200k figure assuming a 6% rate of return, which is basically the inflation-adjusted rate of return for the S&P 500. both the $200k and $60k are 2020 dollars.

>> both the $200k and $60k are 2020 dollars.

This is the problem. $200k in 2020 dollars wont mean much 40yrs from now. Similarly, $60k sounded like a huge figure in 1980 for retirees planning for 2020. For a proper comparison, you'd need to compare purchasing power of $60k to a retiree today vs $200k to a retiree in 2060 -- i'll bet it is about the same!!!

Inflation is a huge unknown here. My parents' home in 1981 was $35,000. The same exact house today is over $1,000,000. Rent used to be $150 to $200/mo. The same rent today is over $3500.

I re-ran your numbers here: https://www.investor.gov/financial-tools-calculators/calcula...

I did a monthly $100 contribution at 6% assuming tax free comounding for 40yrs and came up with your figure of $200k. That is right -- you'll have $200k at this rate. But in the year 2060 that might be just a year of rent and you're broke!


I hope this doesn't come off as condescending, but I think you are missing the distinction between real and nominal value. if I just say "$200k" without qualification, that is a nominal value. if I associate that nominal value with an instant in time (a whole year can be a narrow enough window when inflation is reasonably low), it becomes a real value. when I say you would have $200k in 2020 dollars in forty years, inflation is already taken into account. if a dollar is worth half as much in 2060, I'm saying you would have $400k in 2060.

you are right that inflation is a huge unknown. if inflation goes up massively without a corresponding increase in nominal returns (unlikely, but possible), it would make that 6% figure incorrect. in this case, you would have less than $200k 2020 dollars in 2060, but the real value of a 2020 dollar would not have changed.

as a concrete example, suppose I own a three shares of microsoft stock and you have a brand new ipad air. both are worth about $600 today. if I offered to trade you my microsoft stock for the air, you might be happy to do so if you don't have any use for the ipad. if the fed prints trillions of dollars overnight causing the value to collapse, it doesn't change the fact that my three MSFT shares have roughly the same real value as the ipad. "2020 dollars" is just a slightly more abstract way of describing this dynamic.


Fair, but i'd say the 6% assumption is suspiciously high in that case. I think you might be doing something like ({mean SPY return} - CPI)

Except that CPI is a deviously misleading number. I wonder if the same approach applied in 1980 would come close to aligning with 2020 numbers (including healthcare, college, rent, energy, etc.)

Please be brutal in your response, I want to understand if my understanding of this is all wrong!


keep in mind, this is really just a back-of-the-napkin calculation. I'm certainly not an expert on the matter, but AFAIK 6-7% is generally accepted as the real rate of return on the S&P 500 (at least historically and over long periods of time). inflation calculations are always kind of messy thing though. in reality, some goods/services increase in price much faster than others, and CPI will be very sensitive to what goods/services you choose for your basket. even when you take into account overall inflation, college tuition is vastly more expensive than it was a few decades ago. it also gets tricky when you consider that the quality of goods can increase over time. a mainstream CPU costs about the same as it did in 2000, but is way more powerful. is that deflation, or is technological advancement a separate thing? I never got far enough in economics to know the answer.

Given today's interest rates, a 6% inflation adjusted return rate is going to be impossible. More like 1% if you are lucky.

yeah, I'm assuming most of the people on this forum have upper-middle salaries or will likely have them in the future. I mostly wrote the post with this audience in mind, though I think the bit about analyzing spending in relation to your savings rate is relevant to everyone. I am very fortunate to have the opposite "problem": I tend to be very stingy and waste a lot of time and energy trying to save amounts of money that just aren't very meaningful compared with my savings trend. unless you're unable to save anything at all, I think it is very important to strike a balance between saving for retirement and spending on stuff you enjoy in the moment.

also minor addendum: someone with the median 401k savings might receive something close to the median social security payout of ~$15,500/year. since this is a guaranteed payment until end of life, this is like having >$375k in a retirement account at age 67. $200k is a meaningful amount to add to a $60k retirement account + social security payments, but it doesn't do anything close to quadrupling the person's safe spending capability. it's more like a 45% increase, which is still nothing to shake a stick at!


> since this is a guaranteed payment until end of life, this is like having >$375k in a retirement account at age 67.

I would not bet on social security retirement age staying at 67, nor would I bet on the purchasing power of $15.5k remaining anywhere close to it is today.


sure, don't lose track of the thread though. I'm comparing against someone who is currently retiring with $60k in their retirement account. $60k probably won't be the median 401k value in forty years. all this stuff is subject to change.

I'm not sure how one would survive on 60k for even 10 years. This isn't an "investable" amount and it's not enough for food, yet along housing expenses.

Clearly nobody is in that situation. If you have any money at all in 401k, you almost surely have paid significant amount into Social Security, which pays out retirement benefits independently of whatever you might or might not have in 401k account.

>which pays out retirement benefits

. . . maybe . . .


This all depends on what you assume for spending. Speaking from experience, it is pretty easy for an "entertainment" budget to hit $1000 per month, or a $2MM inflation adjusted savings.

4x nice restaurant or dates = $200 1x Weekend trip = $250 Hobby projects = $100 Drinks with friends = $100 Media Subscriptions =$50


Most of the people I know who are struggling are stuggling because rent and utilities takes the vast majority of their post-tax income. There's a few people I know who are just terrible with their finances (people who no doubt would have had problems at every previous time in history), but now seems a bit structurally different to some of the boom times due to the number of people I know who have hardship due to expenses they can't easily drop.

pretty sure my problem is >50% of my pay goes on rent :P

But the thing is, nobody said you have to pay for Netflix or Amazon. Each person is responsible for making good choices with his or her money. Lack of financial discipline is not society's fault.

Yes, managing finances takes some level of skill when there are many different expenses in a modern personal budget. But there are ways to live frugally and get ahead. They just aren't flashy or fun.

On two very small incomes my wife and I made big financial strides early in our marriage. We were very frugal but we made it work. We had the lowest tier Internet. We had a very conservative budget for eating out and groceries. We didn't have Netflix or Amazon. Once we paid off a number of debts, our spending was able to increase responsibly.

Edit: More tactful wording.


Standard Netflix is $12.99 per month currently. So that's $155.88 per year. Over 4 years, $623.52.

You didn't pay off $60k in student loan debt and buy a house by refraining from Netflix.


Correct. It was from being very frugal in _all_ areas of the budget. Eating out, entertainment, internet, not taking vacations that wouldn't be financially responsible. Frugal dates, frugal Christmas/holiday celebrations, living in an extremely inexpensive apartment in a not-wonderful area of town. We were pretty late adopters of smart phones because we had cheap flip phones. We gave to charity too.

It's all about priorities, and having a vision for being financially "free". The victim mentality is an _enemy_ of human creativity.

You can say, "this area is too expensive; we need to find a way to move somewhere else". You can say, "I need to sell this gas guzzler and get a cheap, used commuter car." These things aren't _fun_. But they set you up for success.


The crucial data point is missing: "two very small incomes".

US minimum wage is $7.25 per hour. 2 people working full-time at minimum wage would bring in a household income of $30k per year. But you couldn't possibly pay off $60k in debt and buy a house with that. So your household income had to be much, much higher.

One cannot save oneself into a higher income.


presumably GP and their wife did not go on to both earn minimum wage after getting their degree(s?). even today when a bachelor's degree is worth less than it once was, the median wage for college graduates at their first job is around $48k. only about 2% of people with any amount of college education actually make minimum wage. it's pretty rough living on minimum wage, but paying off student debt is very rarely a contributing factor.

You're right. It was about [REDACTED FOR PRIVACY - but much much less than parent's 48k medium income per person for college grads] before taxes, both with college degrees.

I'm sorry lapcatsoftware if it sounded like I was making light of poverty. Poverty is terrible. But at least in the US, there is _so much_ opportunity to not be stuck on a minimum wage salary. Resigning to the idea that, "Well, I guess I just have to work for minimum wage" is not going to help and it doesn't have to be true. It's sad to think that people give up mentally when there's so much they can do to help themselves.


SOMEBODY has to do that minimum wage job though, no? So even if we're looking at the median, there are tons of people who aren't being counted.

What opportunities? Tell me how an average cashier can land an average 150k/year job in a metro area? Don't forget that the said cashier has mediocre intelligence, so-so appearance, zero charisma and little talking skills. He might swap grocery store for an oil change shop, but that's about it. Our society is mostly stratified now, with a little upward mobility left for high-tech workers.

> mediocre intelligence, so-so appearance, zero charisma and little talking skills

That person is never going to move up the economic ladder no matter what rung they start on or what decade they are born in.


That person STILL deserves a modicum of dignity and stability. Most people in this category don't really care if they move up any ladder - they just want to exist and not be facing constant economic crisis and near-homelessness.

Yes, and you're part of the reason. Pessimism fuels itself.

How are you ever going to be financially free from eating out less often? A meal at a restaurant costs what, $100? That's $5K a year. No holiday, another $5K maybe? Cheaper phone, ok, you don't buy the newest iPhone, so maybe you save most of a grand in relation to iPhone couples.

Even the car cost is not as big as the sticker price, because it has residual value. Granted it may be a big figure, but it is also spread over several years.

Seems to me you're literally one raise ($10K or so, and there's two of you?) away from making up such deficits, and you want to be near opportunity for that to happen.


Investing $10k a year at 6% (average stock market returns are 6-8%) gives you $368k after 20 years (net increase of $297k over inflation at 2%). Even if you just saved it for ten years that's $100k. Neither are enough to retire on, but it gives you a lot more options. Even if housing increases faster than the stock market, that $10k is $800/month which could be going towards a mortgage (in addition to the rent they are already paying).

> $368k after 20 years

Work another year or two, and you're doing just as well.


Outside of the obvious "don't buy a gas guzzler" tropes, most of the best ways to save money will end up costing you time. Whether it's living with a longer commute or working more hours, there is a point at which people are just happier living their lives than wasting years in their prime scrounging and being miserable to afford a downpayment on a house in worse condition than what they could afford to rent. Big budget decisions like vacations and cars will obviously factor into this in a big way, but nobody's financial situation is changing massively over a Netflix subscription.

Following your own logic, it's almost like saying how dare you say you had _any_ budget for eating out? Why not just save even more money?


I think part of the disconnect is that many people today assume that life will be, or should be, pain free. Life is hard. It's always been hard. It's hard today.

I think the reason we want to believe otherwise is because of the tremendous wealth we have experienced recently, so we expect that trend to continue indefinitely.

To me, it is the lack of gratitude for what we do have and can afford that galls me.


The generation immediately after WWII gave a glimpse of what was possible, before crafty people figured out how to siphon off the majority of that wealth to those already at the top. And over time, that siphon has grown stronger.

Life should not be as hard as it is. It is hard, and it is not painless, but it's harder and more painful than it must be. We have billionaires siphoning money from the masses (either directly, or indirectly via government action) that are already struggling. Redistributing even half of their net worth would be a life-changing amount for the average person, and could put wind in the sails of many charitable/educational/scientific/medical causes.

There is no reason why the current situation should be allowed to continue, and many reasons why it should not. Obviously it's a hard practical problem to crack (given that a naive approach to redistribution of this kind would be met with a great pushback and implode various systems that we depend on), but unless we do something effective, we'll keep ruining the planet while trampling the poor at the same time.


Your house has smoke detectors and a dishwasher. Your car has airbags. When you decide you want to build a garden shed behind that brick box you need to get permission from the town and pay for that permission. Your dad didn't have any of that stuff. You more or less need a smartphone to function in modern society. There's more wealth sloshing around and more (in terms of quantity, probably not proportion) of it comes your way but you're not getting any freedom to do the things you want to do from that wealth because society takes a huge chunk of it and earmarks it for things and you don't get to use it to take a vacation or whatever. Basically standards of living have inflated and there's no choice not to buy in.

Also the interest rates vs asset prices thing other commenters have mentioned isn't helping.


My dad did have a dishwasher and smoke detectors... Actually, I'm less likely to have a dishwasher than he was, because of space constraints.

I see this argument, but it has limits. A seasonal farmworker today has access to Google and Wikipedia, but they are still working 12 hour days. They are less likely to get communicable diseases due to vaccination and disease eradication, but hospital stays are more prohibitively expensive than before. It's complex.

I feel the same. I'm not earning quite as much you are, but still doing better than most of my peers. None of the millennial spending tropes apply to me, either, since I don't buy anything outside of the usual bag of groceries once a week.

What's especially worrying is that if I'm "doing well", and I'm so screwed, what's going to happen to the rest of the population below me?


As an engineer in his 50's (USA) - I am also a 90th percentile earner, but I absolutely agree, I'm nowhere near as well off as my parents were at my age.

I never had the money to take my kids on nice vacations every year like my parents did. Also never had the money to justify buying a new car. And while I do have a home, I have no hope of paying it off before retirement. (which, as an engineer, in the USA, could be 1-5 years from now, involuntarily - my father worked for the same company his whole life, while I've had to change jobs 6 times, due to either corporate buyouts or layoffs. NEVER had a bad performance review).

All of my kids, my brother and sister's kids (all in their 20's now), are all very much struggling, barely making it (and in a couple of cases, NOT making it). Only ONE of them (my son) got through college and found a reasonably decent job, and even HE is so bogged down with student loans, he may never own a home.

So as a picture of 3 generations, there's a very clear trend.


For reference, 95% percentile would be somewhere around £100k a year in London. (If you look at working men aged 25-55 the number should be a fair bit higher)

I don't know what you earn but if you are early 20s it might be less than that. There is a lot of money floating in London, the price of homes almost make sense when you realize what the top earners actually earn, the few percents competing for the same homes.


The other critical factor is instability in the sense that we can lose our jobs at any time. It makes it very difficult to plan long term if you expect your industry to get offshored, or automated, or generally collapse somehow. Even if these calamities don't happen to you, you'll still switch jobs way more than the previous generation.

If you are London based, you should also factor in that London real estate’s qualitative transformation in the last 40 years. It used to be real estate, you know, local people buying homes to live in. Now it’s one of the best performing asset classes in the world. You aren’t competing for property with your mates with a big inheritance. You are competing with dodgy oil money that needs to be laundered and more honest international investors told to diversify. The rule of law is a precious and rare component of legal infrastructure, so a lot of money is diversified into jurisdictions with strong guarantees.

I’m generally a pro-market person. In the case of UK real estate, I support a ban on non-residents buying property similar to what Canada have.


You're comparing yourself to the wrong baseline. The opportunities now are different than they were 30 years ago. You also might be comparing yourself to a specific data point (your dad), vs statistically.

> I'm a 90th percentile earner. Will 95+ percentile earner in a few years time. Yet it feels like I am not as well off as I should be.

You should correct your attitude then, don't you think? You are a 90%ile earner. I don't know what "should" implies, but put it in terms of where you "are". You'll be happier.


Give it a few months and I think house prices will fall!

House prices will never fall significantly. As soon as a house enters the market at anything below the going rate it's bought by a landlord or a rental company. This will keep house prices high forever.

This is demonstrably false. Why don't landlords own all of Detroit, where housing prices have cratered?

Housing is a market like any other. The going rate can change.


> Why don't landlords own all of Detroit, where housing prices have cratered?

Landlord in the city here - land speculators and landlords own an outsized amount of housing here. Significant churn is caused by blighted house reclaimation by the city, but that's one of the few driving forces allowing residents to have access to housing stock - and by the time it's blighted, there's a good chance it's not livable without significant investment.

Blight is generated because many properties/locations provide such a low rental income low that non-resident purchasers just buy the land as speculation, often doing no maintenance until the house is no longer livable.

While the previous comment isn't as hard of a truth as it implies, large capital owners rather than those who would reside in a home are increasingly the main purchasers of property, at least in Detroit.


>Why don't landlords own all of Detroit,

The same reason the used car lots don't own all the rust free classics in California, an exceptionally asinine regulatory environment that would put them on the hook for an obscene amount of back taxes.


House prices can fall in real terms even if they don't in nominal terms. I think the is exactly the situation we are likely to see in an environment where the solution to every problem is "stimulus" and "money printer go brrrrrr" in response to the housing market taking a dive.

If the money printer only gives money to asset holders, the inflation will only happen in the asset economy, as opposed to the Main street economy.

This is what we saw with QE in 2008, and what we're seeing now. Asset prices are skyrocketing, while the price of bread is staying more or less stable.


You might find the Cantillon Effect to be of interest: https://www.austriancenter.com/cantillon-effect-populism/

The effects of inflation are somewhat localized at first and the movement of money in the economy matters significantly in terms of the purchasing power of that money for various groups over time.


It's interesting because this looks at inflation from another angle. Some of the central bank money does eventually circulate in the economy but since the money goes to assets first, consumer inflation will always lag behind asset inflation and therefore we have a redistribution effect from the poor to the rich. Unless central banks adopt policies that distribute money evenly among the population they are going to keep distorting the economy.

The central bank cannot distribute money evenly among the population. Congress however can and they basically did albeit selectively based on need with the CARES act which gave citizens direct cash handouts, massive increases to unemployment, and indirectly by funding payroll for small businesses and airlines.

However, they are supposed to maintain a budget and the CARES act alone cost over 2 trillion dollars so they finance deficits by selling US treasury securities. If you look at the outstanding debt, it has grown by about 3.6 trillion dollars worth of outstanding treasury securities from january to august [0]. If you look at the federal reserves asset sheet trends [1], you'll see it grown by up about 3 trillion since january [1] with over 2/3 of that buying those same US treasury securities our government sells to finance the deficit [2].

My point is that if congress had simply decided to pay for all deficits including those direct and indirect payments to citizens this year with printed money and the federal reserve did nothing, we would be basically in the exact same position. Congress is spending to put cash in citizens pockets and the federal reserve is buying up most of the treasury securities that congress is selling to fund that.

[0]: https://www.treasurydirect.gov/govt/reports/pd/mspd/mspd.htm

[1]: https://www.federalreserve.gov/monetarypolicy/bst_recenttren...

[2]: https://www.federalreserve.gov/releases/h41/current/h41.htm


The problem is that the fed did not buy those US treasuries.

The fed bought a bunch of crap bonds from the market at above market value (As prior to their involvement, those bonds were tanking), and the people who sold them those bonds then went on to buy treasures and securities.

It socialized the risk, and privatized the profits.


From the current asset sheet in millions of dollars:

  Reserve Bank credit: 6,968,229
  U.S. Treasury securities: 4,391,505
  Mortgage-backed securities: 1,949,547
That puts treasuries and mortgage backed securities as basically their entire balance. Corporate bonds are listed in section 1A as Other securities which Includes non-marketable U.S. Treasury securities, supranationals, corporate bonds, asset-backed securities, and commercial paper at face value and that comes out to a grand total of 86.729 billion or about 1.24% of their asset sheet.

"Housing prices only go up" - Said right before the housing crash of 2007

I also don't think this is true... We saw house prices crash 10 years ago, with many owners being convinced that housing, a finite resource, can never go down significantly.

That did certainly happen, but prices were not depressed for any significant amount of time either! Particularly at the timescale of housing transactions. It can take several months to close on a house for example.

Well, I'm only saying that because apparently over 700k people have become unemployed on account of the C.V. That is a significant number of the working population in the UK. This should mean that there would a significant decrease in prices - the bottom would have fallen through the market. I know that the government have pumped huge amounts into the economy which is inflationary. Still, I think house prices will have to drop.

What's your model?

My mental model is that there's too much wealth sloshing around for "large incomes" to make too much difference.

High income is like delta-v, it's great. But you're still near the ground, and you're competing against people already in high orbit.

The beneficiaries of the housing explosion have equity which they can parlay into more ownership, whether for themselves as investments or their children.

Record low interest rates help prices by letting people lever up (letting them spend their lifetime earnings now) to compete but of course also bids up prices, again to the benefit of existing homeowners.

This is reflected in the fact that (for example) in the U.K over 1/3 of first time buyers did it by getting money from their parents: https://www.gov.uk/government/news/first-time-buyers-relying...

Furthermore, in the UK, Australia and NZ (less familiar with the US or Canada) it seems the government will move heaven and earth to prop up housing.

High immigration rates and supply restriction have not been helping.

I'm not as convinced as GP that the situation can last "forever", but I could see it lasting for another couple of decades. A true housing collapse would probably be a phyrric victory for the young.


Add to the other comments the signs and billboards advertising "we buy houses for cash, no questions asked" all over certain areas.

Home prices falling because many people’s incomes have gone to $0 is bad for affordability.

(We detached this subthread from https://news.ycombinator.com/item?id=24491909.)

> I'm a 90th percentile earner. Will 95+ percentile earner in a few years time.

How much is that in the UK?



90th percentile is about £47K, 95th percentile is about £60K. Assuming gross income.

As of 2019

---

US 90th percentile: $184k (£144.3k)

US 95th percentile: $248k (£194.6k)

kind of a silly thing to say you are a 95th percentile British earner when that puts you in the 25-50th percentile in America.


You are paying for your Dad's pension, and for the Government services consumed by millions of migrants.

Those same migrants increase labor supply (thus lowering the equilibrium price) and increase demand for land and real estate.

The end result is high taxes and high real estate cost. Of immense benefit to your dad (and other Baby Boomers) who receive risk-free pensions, and supercharged capital gains for their own assets.


I don’t understand why you are downvoted. Millions might, not necessarily though, be an overestimate, but I agree with the analysis in principle.

Disclaimer: I’m an immigrant.


High tax rates are what causes this. You are effectively giving away half your wage to sustain a completely unknown person leeching off the government.

What an absolute load of tripe. I'd gladly pay even higher taxes than I do to make sure everyone has access to healthcare and benefits when they need them. "unknown person leeching off the government" is the attitude that just needs to die, it annoys me so much that people still believe this crap, any one of us can be this "unknown person" at some point.

right? and like something i've come to realize over the years is that there is a huge value add of having something just work that i don't think many people actually appreciate. I would absolutely love to pay more in taxes if it meant medicare for all so that if i get hit by a car while riding my bike someone can call 911 and i can go to a hospital and not worry about how much the ambulance costs, whether the doctor i see is "In Network" or not, and not have to figure out how much of whatever needs to be done is covered by the insurance and what the hospital is going to bill me for and whether I can actually afford that or if I need to go into insurmountable debt just to exist.

life already sucks enough as it is, and is entirely too complex in so many aspects that no longer having the "can i afford to not die in an emergency" thought would be such a huge net plus for a huge majority of working americans.


I'd pretty much prefer they'd go against evaders first. two reason: even if it's not as much as what you can tax out of the 99%, it does alleviate middle class pressure.

second reason, middle class can't get savings any more. savings are essential for a wealth of reason, including starting a family, a business, investing in property or other people ideas. these are all essential for growing a solid economy long run.

angel and VC money works as a surrogate but it goes only so far as it aligns with the 1% incentives; it burns as much as it elevates, maybe even more, and is more of a way to extract money from growing SMB instead of a way to build a wealthy middle class, as they only play for the exit.


This is blatantly false. Income tax on higher earners in the UK has decreased since the 1970s/1980s when IIRC the highest tax bands were over 70%, if not higher.

Yet in the UK the amount of tax paid by the 1% is the highest ever (34%), 42% of adults pay NO income tax.

And the tax take as a proportion of GDP is 34.4%, the highest EVER.

We are living in the most taxed time in history with the rich contributing the most ever. Not the impression you get from people complaining about it.

https://www.theguardian.com/business/2019/nov/13/richest-bri...


Your article doesn't directly talk about the tax rate for the top 1%.

The fact that the percentage of total tax collected attributed to the top 1% has risen from 24% to 30% seems to be more indicative of higher wealth inequality, especially if the figures the other posters have mentioned about lower total tax rates on the rich are true. To me that's a good reason to raise taxes on top earners and lower taxes on the middle class.


How do you include record adults not paying taxes in that then, along with record employment?

Do you want everyone paying more, and the poor paying tax as well, or more income inequality but less people paying tax? You can’t have both.


When you make most of the money, you pay most of the taxes. You can't squeeze blood from a stone. 10% of a billion dollars is a lot more money than 50% of $100,000.

Its the highest ever because the 1% are correspondingly much richer than ever.

Have they fallen generally, or has the highest tax band fallen?

Germany had the highest tax rate > 50%, it's now 42/45%. At the same time, the income required to be taxed at that rate hasn't changed with inflation, so while it was e.g. 52.152€ in 2002, it's 57.051€ now - adjusted for inflation, it would have to be closer to 75k€.

Lowering the top marginal tax while not adjusting for inflation so more people get pushed into higher tax brackets from below is great if you're rich, but shit if you're not.


90%ile now is £55k a year and gives you £40,543.60 net.

£55k today is £32,461 in 2000. In 2000 someone on £32,461 had a take home pay of £24,080 -- the equivalent of £40,800 today.

So not much change.


Erm it's also not great when you're rich. Either way you're being taxed more year by year (in adjusted inflation euros)

If you're going from 70% to 50% (or from 57% to 45%), I'd say that's pretty great.

You mean healthcare, roads, education and social security for when I lose my job due to COVID? Taxes are nothing new and have always been like that.

Don’t forget military spending

That’s not an argument against taxes, that’s an argument for redistributing where our taxes go. I would suspect that a reduction in the tax rate would mean a less-than-proportional decrease in military spending, anyways, so it’s not clear lowering the tax rate would even help.

This statement is flat out false. Tax rates are significantly lower than they were in the past.

Rates and effective rates are too different things.

Some states have zero income tax but the effective tax rate is often similiar because pretty much every interaction with government is self-funded with fees so the effective tax rate is much higher than the on paper tax rate. Conversely you can have a tax rate and then let people deduct everything under the sun getting a lower effective rate. Kind of like how if you income is below the EIC amount (which is definitively not ideal) in the US federal income tax exists on paper (I forget what the rate is) but the effective rate is zero, possibly negative even)


At least in the US, this isn't true, tax rates have fallen over the last 40 years

https://taxfoundation.org/us-federal-individual-income-tax-r...


Talking about Europe here

What makes Europe unique such that the proposition that lowered taxes would lead to greater Millenial success holds true, when the same low-tax policies applied in America seem to have yielded similar results to the European approach? If this seems like a leading question, it's not intended to be--I'm American and curious about the potential variables at play here that I'm not aware of.

the European market is a disaster for investment and entrepreneurship, that's what's holding millennial back. your average SMB reach is often regional, and the bureaucracy structure makes almost impossible for garage operations not only to go above national, but to even exist.

like in sports, the size of the talent pool matters, and with an unbearable cost for entry entrepreneurship almost s losing proposition unless if under the heels of some financing partner whims, as it's the only realistic option to sustain the bottom line costs from handling vatmoss, letters of taxations and the other billion historical bureaucratic commitments


The bureaucracy part is not true in the Netherlands. Making a business and administering is easy here. In Germany, it's a nightmare.

No, it isn't. Housing prices as they are are a product of supply and demand. Such that, regulations are preventing the building density required to meet unceasing demand propelled by immigration.

Historically rate of taxes were not much different than they are now, whether for North America or the UK.


Housing prices increasing because of slow zoning and regulations has been debunked already. Typical argument used by property developers.

The reality is that building houses for investment is more profitable for developers so they keep building it. As opposed to affordable housing actually used for living. The result is a glut of luxury investment apartments and lack of affordable nonluxury housing.


No, they just can't build enough. It's not as though building high-rise condos and houses is mutually exclusive.

In Japan, houses don't really appreciate. People just knock them down and build new ones with much more ease. There's certainly no shortage of developers wanting for "investment" apartments, it's not the deciding factor. The demand can actually be met there.


I'm not seeing that luxury investment housing, though. The newly built houses are usually +/- cheap junk at premium prices. At the same prices there's a low supply of 30-40 year old homes, but of a way way better quality. And in any case, new construction + available supply is nowhere near enough to meet the demand. What folks without 500k/year are doing I don't know.

In the UK a 90% income is £55k gross.

Net wage on that is £40,543, so that's 26% tax.

Local taxes would be about £1200 a year (council tax - a property based tax), so call is £39k -- 29% total tax.

In the US a 90% income is $117k gross. Take home pay is 88,866, or 24% tax, that's after Federal Income Tax and Social security

On top of that there's local income tax, picking a random state -- New Mexico -- that's $4,856, leaving about $83k -- 29% total tax.

So seems that UK and US taxes are about the same, but in the US you have to fund your own healthcare.


Lowering taxes will just cause inflation.

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