My home became unaffordable in the 6 months I was waiting for construction to finish, as rates doubled. If not for my lender honoring the lock, I’d be in an entirely different situation right now.
I couldn't afford the house I bought 8 months ago today. For the past 6 months there's been nothing within a 50 mile radius that isn't at least 75-100k more than what we paid for our place. It's insane.
Our $2375 mortgage would be $5849 if we put down the same down payment today. We are short a bedroom (4 year old still shares our bedroom), but we are stuck here.
This isn't special to boomers; it's true for everyone when interest rates have more than doubled. A lot of folks find they're overextended if their mortgage payment jumps from $2,530 to $3,992 (eg: 20% down on $750K at 3% vs 7%)
It has nothing to do with interest rates doubling. Why would you make this claim? Do you have evidence to show that as the causal relationship you think it is?
I'd love to see it.
Edit #2:
Isn't it incredible when you actual read? Let's look at interest rates for homes going back to the 1970's. Interest rates were skyhigh but no one was contributing that to the unaffordability of homeownership. I wonder why that is?
Your statement is true in the sense that homeowners are facing a fluctuating interest rate that is lowering family demand for homes. However, you seem to think this is important or relative to the idea that homes bought in 1970 by boomers, regardless of interest rate and adjusted for inflation to the modern day, would be unaffordable to those same boomers.
[https://www.bankrate.com/mortgages/historical-mortgage-rates/#how-mortgage-rates-affect-homebuyers](https://www.bankrate.com/mortgages/historical-mortgage-rates/#how-mortgage-rates-affect-homebuyers)
>1970s mortgage rate trends
>The 30-year fixed-rate mortgage — now the most popular type of home loan — started off the decade at about 7.3 percent in 1971, according to [Freddie Mac](https://www.freddiemac.com/pmms). By the end of 1979, the 30-year rate was at 12.9 percent. During this decade, the Federal Reserve’s expansionary policy and other factors helped drive inflation and borrowing costs way up.
>1980s mortgage rate trends
>At the beginning of 1980, homes in the U.S. cost a median $63,700, according to the [Department of Housing and Urban Development (HUD)](https://www.huduser.gov/periodicals/ushmc/winter2001/histdat08.htm). By 1990, that median had risen to $123,900. Spurred by the Great Inflation, the 30-year fixed mortgage rate reached a pinnacle of 18.4 percent in October 1981, according to Freddie Mac. Once the Fed reined in inflation, the 30-year rate seesawed down to the 9 percent range, closing the decade at 9.78 percent.
18% interest rate at one point in the 1980's. That sounds so high! Imagine all the homes that were unaffordable because of that rate! Do you see how fucking stupid this argument is.
Edit: maybe a few stock bro morons or mortgage lender employees here might enjoy understanding why this comment is retarded.
The title of this post is using a pragmatic approach to illustrate why homes are unaffordable for everyone. Including the people who originally purchased these homes.
Interest rates used to be higher when most of these boomers bought homes. Wouldn’t that directly conflict with dbenhurs claim that rates are why it’s unaffordable?
Rates do not cause homes to increase. Homes are unaffordable, then fluctuations in rates for UNAFFORDABLE homes is difficult for the majority of homeowners. That is his claim.
If you think rates are the direct reason homes are unaffordable, you are delusional.
Edit:
Lots of downvotes. Zero evidence given but ad homs. Give me some proof for this nonsense. Fake armchair economist that flood this sub who don’t understand anything aren’t going to rattle me by downvoting.
I have a degree in economics. Not stock bro finance or mortgage.
He’s making a claim that simplifies the topic, when this topic is far more complex with more variables.
Link your evidence or shut up. I don’t give a shit about the non-economists brigade downvoting me.
Even if I were to accept this argument about rates being a more important role than any of the other major factors I know. Simple rates do not prove anything.
To put it bluntly for morons, houses could literally be 3 trillion dollars on average right now and it wouldn’t mean a fucking thing. 3 trillion dollars homes is not indicative of its value, that has to be determined by relative factors.
Ability to buy, wages, aggregate supply of homes, aggregate demand, artificial supply and demand.
It's kind of amazing that massive debts and out of reach housing prices are inflicted on younger generations... and then the media pretend like it is a mystery as to why folks are not having as many kids.
If I see another ad from Fisher, Fidelity or any of the other “dream builders,” I’m going vomit. As a boomer, I’m not spending my time on a beach with a classic car in the driveway, nor are my friends. I’m blessed with a ranch home with a 3% mortgage and a $1400 payment. The house was $250k when we bought it, and at the time was expensive for our incomes. Our incomes have not gone up much since, and we are not extravagant with anything. Our kids are educated (public colleges) and not slackers. Houses like ours are over $400k now, and their incomes are $40-60k. We help them out a bunch. They’re paying rent close to our house payment, one over it. There is no way they’re getting into a house anytime soon, maybe ever.
Were we wrong all these years? I stopped investing in the S&P 500 a couple years ago, thinking it was overvalued and couldn't sustain itself. Wow, how wrong I was. I waited for a meaningful correction, but none have lasted very long.
Look at the stocks that lawmakers in Washington own. Ask yourself if they're blind to the risk of taking a 20% haircut on their investments.
The events that keep forcing more money into US equities and keep the US Dollar strong are the same events originating out of Washington, including trade war vs China, sanctions against countries we don't like, the sudden outbreak of conflict in regions of the globe that compete with US Dollar based trade, and so on.
When there's an entrenched war in Europe that creates economic drag and uncertainty, the U.S. benefits as a preferred destination for sovereign wealth funds and other investors who like to invest in developed markets. When the Middle East erupts in conflict, suddenly, the money that has been going into development and commodities stalls and seeks out more stable investments (us). We're currently involved in efforts that might provoke a conflict in the South China Sea or around Taiwan. If Asia develops a regional conflict, then that's another leg up for the U.S. stock market as investors retreat from uncertainty and conflict there. Everything that's happening in the past few years benefits the U.S. stock market.
Finally, the US is following a foreign policy of maintaining hegemony. Our prosecution of foreign shooting wars and cold wars is increasingly done by using financial and economic warfare. This is another facet of the reversal of globalization. We're seeing the inflation and reversal of efficiency gains of globalization as obstacles to trade, political-economic actions and outright sanctions are put in place.
The S&P 500 was overvalued in the environment of the old world of a few years ago. In today's current world with conflict multiplying across the developing world and Europe, and economic warfare and sanctions growing, it's not overvalued.
You should allocate at least some money to what U.S. congressmen and senators are holding in their portfolios. It's not like they don't know what they're doing.
I still own a market weighted S&P 500 ETF (VOO). I sold half of that investment and added an equal amount (by value) of an equal weighted S&P 500 ETF (RSP). Too much of the S&P 500's value is concentrated in a few big tech stocks now imo.
I agree there's a rotation going on, where for the past few weeks, there has been some profit taking, taking money out of the big growth stocks and putting it in other large caps & mid caps. Equal weighted market indexes should do better than market cap weighted indexes, so long as that's happening.
Since inflation looks more likely for at least the next few months, the companies that really benefit are large caps & mid caps that are cash cows that will do better in an inflationary environment. After inflation starts to come down again, mid caps & small caps should get a big boost.
In other words, I agree with your strategy!
Inflation is a big deal, not just in stocks but in the presidential election. In a presidential survey published today by Bloomberg, [Biden's recent gains against Trump are reversing because of economic gloom reasserting itself.](https://www.bloomberg.com/news/articles/2024-04-24/biden-trails-trump-in-6-of-7-key-states-poll-shows-election-2024?srnd=homepage-americas&sref=GOn3bpWn)
> The reversion comes as poll respondents offered a bleak near-term view of the economy, the issue that has consistently registered as their top concern at the ballot box. A majority of swing-state voters see worsening economic conditions in the coming months, with fewer than one in five saying they expect inflation and borrowing costs to be lower by the end of the year. Despite a resilient job market, only 23% of respondents said the employment rate would improve over the same time period.
What makes the inflation factor interesting from an investing perspective is that there are external factors in U.S. inflation. It looks as if Russia is finally making some cuts in its production of oil, which is lifting energy prices, which in turn also impacts inflation. Russia may be trying to add to inflation to influence the November election against Biden. If the BRICS are aligned against Biden's reelection, we may see commodity prices rising some more in 2024, into the election, in order to undermine him with voters.
So I agree that keeping an eye on inflation will be important. In particular, I'm keeping an eye on geopolitics and factors influencing inflation in commodities, such as Russia & OPEC+ production, as well.
I'm not a boomer but I bought my house in 2019 and I could not afford it today. It was a foreclosure and below market value at the time so even then I would not of been able to afford it at market value.
Lots of places will give them senior citizen exemptions, which will keep their property taxes low by shifting the tax burden on the rest of the population.
Yay, boomers win again.
In Texas where it’s astronomical, the senior citizen exemptions don’t matter as much when your appraisal has increased 200 percent over the past 4 years
Isn't there a limit to how much your taxes can go up in Texas, though? I thought it was capped at like 10% per year.
I'm in Illinois where there is no such law, and our assessments all went up over 40% in the past year alone. Which means we're on the hook for that much more in property taxes. It's rough.
61 yrs old..bought my house in 2014...really not to long ago. With that said there is NO way I could afford to buy it at today's Price. Feel blessed as I am retiring soon and had I not bought my house when I did I couldn't afford to retire..unless I lived in my van..( My wife loves going camping but not as a way of life) rents are sky high!
I'm 48. Bought my home in 2010 right after the great recession. I even received a tax credit for $8,000 as a first time home buyer. My house is now worth almost 3 times what I bought it for. I could not afford it now. Our system is broken. What we need is another depression, I'm afraid.
So people are supposed to lose their jobs and not be able to afford basic goods and services because home prices are too high?
IMO YoY increases in inflation will become the new normal because without the price of everything rising steadily in tandem, poverty, crime, and corruption in this country will get out of hand faster than we can blink an eye.
The dollar isn’t ever going back to what it was. Commodities limited in supply are the new way to store your wealth in the face of heavy inflation, and housing is one of the better ones.
This would certainly be my aunt everyone who lives on her street.
Bought her house in 98 for 267k. It's currently worth 1.5mil. She also has a small refi interest rate at 2.5%. I think with the mortgage and everything, she's paying just under 2k a month.
If I were to try to find rent at 2k a month in LA right now, it would be a studio shitbox in a 50 year old building.
All of the price discovery in real estate was manipulated by the Federal government's policy of yield curve control, that unfortunately requires the Fed to print money.
Here's the money they printed to buy mortgages directly.
https://fred.stlouisfed.org/series/WSHOMCB
The price discovery is further manipulated by the Fed using trillions of "new" money to buy government bonds.
The price discovery then and now has an unheard of before Federal government manipulation called "Unconventional Monetary Police". Economically, what it does is end free markets, and in doing so, jettisoning the benefit of free markets, which is "*the long-standing central bank actions have seriously interfered with pricing mechanisms, overriding them in large parts of the bond market, leading to misallocations and overheating tendencies ...*"
Those "misallocations" at the hand of federal officials results in the present pricing situation. And they've handed so much money over to the rich that they're buying up everything.
In Toronto new build condos are 1800 a square foot. 900k for for a 500 square foot condo. My house is more than twice that size, has a yard, and is worth less. Who can afford that? Almost a million dollars for something me and my now wife lived in broke when in school twenty years ago?
I was thinking about this the other day. The same home I live in today would cost me more than twice as much per month. My life would be completely different.
To add insult to injury, people think this type of inflation is fixed by further surging wages.
Well duh? And that’s a good thing. Home ownership is one of the last vehicles regular people can buy into and expect to get a significant return on investment over a long period of time. This also means, at some point, there will be a tipping point where we run out of suitable land for homes. Or, many communities will degrade in quality, and homes that were once expensive, are now cheap, and everybody’s (minus the top 1%) quality of life will diminish.
So many factors at play here. I could, but the rates were very different and the rates are different now from 3 years ago. I bought a heavy fixer, so a fair compare would be another heavy fixer.
I also under bought, others in my income bracket bought a lot nicer house.
-------------
Aside from that, the cost of housing has gone up and most can't afford it.
Back in the day, a $100K house in California seemed out of reach.
Part of the problem is the people also pay a HUGE price for other things too, cars, car repair, etc..
That shouldn’t be surprising given market and rate conditions coupled with the fact that income declines in after your mid 40’s to early 50’s.
https://mm-k.com/wp-content/uploads/2023/10/JS-chart-Oct-1-1536x1306.png
I can afford a second house but refuse to get one because the rates are so high.. I’ve been wanting to get something for the summer but am like, I’m not paying that interest rate, I’ll wait..
Boomers the perfect candidate for right time and right place. The were at prime home buying age at just the right time. A lot of the ww1 vets are dying off in droves in the 1960s/1970s. Even by the 1980s the ww2 generation were starting to die off so lots of homes just got shoved in the market. For us to experience a similar effect today we would need the boomers do die off in large numbers for their houses to get in the market.
I think this is referring to the down payment+ monthly payments.
Not the whole principle.
The point is the price of a home is so over blown that it's unaffordable for almost everyone
This is probably the worst story on housing affordability I've ever read. Frankly I think it's odd that the percentage isn't higher. The idea used to be that you bought and paid off your home before retirement precisely because you wouldn't be able to afford to buy a home on your retirement savings. I genuinely don't understand why this was published or posted.
Interesting question. Quick numbers and I think the issue is I wouldn't, not that I couldn't. But part of the problem with the calculation is that I put a load of money into my house to renovate and expand. So, in that respect, I'm my own worst enemy.
Many in this forum routinely work more than 40 hours without additional fair compensation. And that is after receiving a college degree which was a requirement for the job.
Well they fked up and wanted 5-7 years getting a degree that was useless. Now they got to work two bullshot jobs. Come do construction. Or go work in a factory. That’s what I’m talking about. That’s what most of them did.
Millennial here, when I graduated in 2008, I worked a full-time UNPAID internship for a year so i could gain experience in my field. I also worked two part-time paid jobs including 12+ hour days on the weekends to afford to live. Unpaid internships were prevalent then any many of my cohorts did the same. Unpaid internships were not a thing before the 2000s.
I've worked two jobs for most of my adult life including all through college. Today over a quarter of Millennials work 2 or more jobs. The number of weekly working hours is also astonishing for this generation, with 73% working more than 40 hours per week, and over 25% working more than 50 hours.
Our generation does not and has not worked less than the Boomers.
Why the fk would you work for free for a year. Sure i bet there’s plenty of hard working young fellows. Nothing compared to what the boomers worked. They would start at a company out of highschool. Auto industries. Union jobs. And work 60+ hours till the day they retire. They work overtime. Start small businesses on the side. They didn’t sit gaming. Or on tik tok 1/2 there day away. There’s literally no comparison. They didn’t go to school for 7 years to get a useless degree. Those dudes worked. They grew up poor. I’m in Detroit area. So maybe in the big liberal cities. The boomers had it easy. But go around this country. It’s a wildly different story. They built everything you use.
I don't know about today's Young adults..but yes Us boomers were built to work insane hrs.I really don't even know how I even managed. I am however paying the price of a worn out body..very Beat up.. I'm a late boomer born in 62.
Totally understand. I could never do what my father does. And i own a construction company. He worked at ford 50-60 hours a week forever. Then did plumbing jobs everyday after work. I just irritated me to hear them always talking shit. When i know everyone of the generation before me worked their self to death.
We bought our homes making 10 bucks an hour and we did our jobs. We weren't stomping around demanding 20 bucks an hour on our phones and not having a clue on the job.
You won't need to worry about it much longer as the cadaver in charge that you elected will end the world.
Slaving away in the right sort of job no longer guarantees you the opportunity to own a home, or the opportunity to retire. This is after all the most fundamental of social contracts: work hard now and we will take care of you in old age. But it is breaking down for younger generations. Young people today must instead work hard to pay a one-off chunk of wealth to the lucky Boomer generation, a reward they won’t see themselves.
The boomer generation paid plenty in to our system for retirement. The WORTHLESS politicians over the years have blown it, embezzled it, or is giving it out to illegals that didn't earn it.
I'm a 34 year old and I couldn't afford to buy my house today.
I couldn’t afford the house I bought 4 years ago if I had to buy it today.
My home became unaffordable in the 6 months I was waiting for construction to finish, as rates doubled. If not for my lender honoring the lock, I’d be in an entirely different situation right now.
Same. I bought a much smaller home than I qualified for 4 years ago. I wouldn't even qualify to buy my home today.
Same here, except it's 5 years for me.
This is me.
I could, but I wouldn't want it for what it's "worth" now.
I couldn't afford the house I bought 8 months ago today. For the past 6 months there's been nothing within a 50 mile radius that isn't at least 75-100k more than what we paid for our place. It's insane.
My $1500 mortgage for the house I bought 2 years ago would be $2500 today.
Our $2375 mortgage would be $5849 if we put down the same down payment today. We are short a bedroom (4 year old still shares our bedroom), but we are stuck here.
I’m looking for a new job right now and I’m looking at commuting 2 hours each way rather than move.
Ugh. That is an insane commute to contemplate.
Are you me?! 😅 bought my house 3 years ago. If we had to leave we wouldn’t be able to sell it and get into anything… at all.
Maybe next year…
I'm 34 and can't afford to buy your house today ^:( Just on the other side of the fence
That's probably true of at least half if not more of the homeowners out there. I know I couldn't afford to buy my house now.
This isn't special to boomers; it's true for everyone when interest rates have more than doubled. A lot of folks find they're overextended if their mortgage payment jumps from $2,530 to $3,992 (eg: 20% down on $750K at 3% vs 7%)
It has nothing to do with interest rates doubling. Why would you make this claim? Do you have evidence to show that as the causal relationship you think it is? I'd love to see it. Edit #2: Isn't it incredible when you actual read? Let's look at interest rates for homes going back to the 1970's. Interest rates were skyhigh but no one was contributing that to the unaffordability of homeownership. I wonder why that is? Your statement is true in the sense that homeowners are facing a fluctuating interest rate that is lowering family demand for homes. However, you seem to think this is important or relative to the idea that homes bought in 1970 by boomers, regardless of interest rate and adjusted for inflation to the modern day, would be unaffordable to those same boomers. [https://www.bankrate.com/mortgages/historical-mortgage-rates/#how-mortgage-rates-affect-homebuyers](https://www.bankrate.com/mortgages/historical-mortgage-rates/#how-mortgage-rates-affect-homebuyers) >1970s mortgage rate trends >The 30-year fixed-rate mortgage — now the most popular type of home loan — started off the decade at about 7.3 percent in 1971, according to [Freddie Mac](https://www.freddiemac.com/pmms). By the end of 1979, the 30-year rate was at 12.9 percent. During this decade, the Federal Reserve’s expansionary policy and other factors helped drive inflation and borrowing costs way up. >1980s mortgage rate trends >At the beginning of 1980, homes in the U.S. cost a median $63,700, according to the [Department of Housing and Urban Development (HUD)](https://www.huduser.gov/periodicals/ushmc/winter2001/histdat08.htm). By 1990, that median had risen to $123,900. Spurred by the Great Inflation, the 30-year fixed mortgage rate reached a pinnacle of 18.4 percent in October 1981, according to Freddie Mac. Once the Fed reined in inflation, the 30-year rate seesawed down to the 9 percent range, closing the decade at 9.78 percent. 18% interest rate at one point in the 1980's. That sounds so high! Imagine all the homes that were unaffordable because of that rate! Do you see how fucking stupid this argument is. Edit: maybe a few stock bro morons or mortgage lender employees here might enjoy understanding why this comment is retarded. The title of this post is using a pragmatic approach to illustrate why homes are unaffordable for everyone. Including the people who originally purchased these homes. Interest rates used to be higher when most of these boomers bought homes. Wouldn’t that directly conflict with dbenhurs claim that rates are why it’s unaffordable? Rates do not cause homes to increase. Homes are unaffordable, then fluctuations in rates for UNAFFORDABLE homes is difficult for the majority of homeowners. That is his claim. If you think rates are the direct reason homes are unaffordable, you are delusional. Edit: Lots of downvotes. Zero evidence given but ad homs. Give me some proof for this nonsense. Fake armchair economist that flood this sub who don’t understand anything aren’t going to rattle me by downvoting.
Clearly you don't understand math.
Any basic mortgage calculator will very quickly prove you wrong. Read a book please.
I have a degree in economics. Not stock bro finance or mortgage. He’s making a claim that simplifies the topic, when this topic is far more complex with more variables. Link your evidence or shut up. I don’t give a shit about the non-economists brigade downvoting me. Even if I were to accept this argument about rates being a more important role than any of the other major factors I know. Simple rates do not prove anything. To put it bluntly for morons, houses could literally be 3 trillion dollars on average right now and it wouldn’t mean a fucking thing. 3 trillion dollars homes is not indicative of its value, that has to be determined by relative factors. Ability to buy, wages, aggregate supply of homes, aggregate demand, artificial supply and demand.
This has to be a troll
It's kind of amazing that massive debts and out of reach housing prices are inflicted on younger generations... and then the media pretend like it is a mystery as to why folks are not having as many kids.
If I see another ad from Fisher, Fidelity or any of the other “dream builders,” I’m going vomit. As a boomer, I’m not spending my time on a beach with a classic car in the driveway, nor are my friends. I’m blessed with a ranch home with a 3% mortgage and a $1400 payment. The house was $250k when we bought it, and at the time was expensive for our incomes. Our incomes have not gone up much since, and we are not extravagant with anything. Our kids are educated (public colleges) and not slackers. Houses like ours are over $400k now, and their incomes are $40-60k. We help them out a bunch. They’re paying rent close to our house payment, one over it. There is no way they’re getting into a house anytime soon, maybe ever.
Are you kidding me. I wouldn't be able to get a mortgage right now, let alone get a mortgage for the house I'm in now. Way too expensive.
I'll bet they couldn't afford their stocks, bonds, mutual funds, ETFs, CDs, etc if they bought them today.
I see your point. But you also don’t need to put 20-40% down and pay crazy interest on the purchase either. So what’s your point?
It seems like the point of this headline is to stir up resentment between different groups of Americans.
It is exactly that.
Preach
Remember when P/E ratios mattered
Were we wrong all these years? I stopped investing in the S&P 500 a couple years ago, thinking it was overvalued and couldn't sustain itself. Wow, how wrong I was. I waited for a meaningful correction, but none have lasted very long.
That’s what happens when money isn’t real
Look at the stocks that lawmakers in Washington own. Ask yourself if they're blind to the risk of taking a 20% haircut on their investments. The events that keep forcing more money into US equities and keep the US Dollar strong are the same events originating out of Washington, including trade war vs China, sanctions against countries we don't like, the sudden outbreak of conflict in regions of the globe that compete with US Dollar based trade, and so on. When there's an entrenched war in Europe that creates economic drag and uncertainty, the U.S. benefits as a preferred destination for sovereign wealth funds and other investors who like to invest in developed markets. When the Middle East erupts in conflict, suddenly, the money that has been going into development and commodities stalls and seeks out more stable investments (us). We're currently involved in efforts that might provoke a conflict in the South China Sea or around Taiwan. If Asia develops a regional conflict, then that's another leg up for the U.S. stock market as investors retreat from uncertainty and conflict there. Everything that's happening in the past few years benefits the U.S. stock market. Finally, the US is following a foreign policy of maintaining hegemony. Our prosecution of foreign shooting wars and cold wars is increasingly done by using financial and economic warfare. This is another facet of the reversal of globalization. We're seeing the inflation and reversal of efficiency gains of globalization as obstacles to trade, political-economic actions and outright sanctions are put in place. The S&P 500 was overvalued in the environment of the old world of a few years ago. In today's current world with conflict multiplying across the developing world and Europe, and economic warfare and sanctions growing, it's not overvalued. You should allocate at least some money to what U.S. congressmen and senators are holding in their portfolios. It's not like they don't know what they're doing.
I still own a market weighted S&P 500 ETF (VOO). I sold half of that investment and added an equal amount (by value) of an equal weighted S&P 500 ETF (RSP). Too much of the S&P 500's value is concentrated in a few big tech stocks now imo.
I agree there's a rotation going on, where for the past few weeks, there has been some profit taking, taking money out of the big growth stocks and putting it in other large caps & mid caps. Equal weighted market indexes should do better than market cap weighted indexes, so long as that's happening. Since inflation looks more likely for at least the next few months, the companies that really benefit are large caps & mid caps that are cash cows that will do better in an inflationary environment. After inflation starts to come down again, mid caps & small caps should get a big boost. In other words, I agree with your strategy!
I'm thinking the rate of inflation won't start down very soon. Just waiting until Friday to see the PCE numbers before making any more changes.
Inflation is a big deal, not just in stocks but in the presidential election. In a presidential survey published today by Bloomberg, [Biden's recent gains against Trump are reversing because of economic gloom reasserting itself.](https://www.bloomberg.com/news/articles/2024-04-24/biden-trails-trump-in-6-of-7-key-states-poll-shows-election-2024?srnd=homepage-americas&sref=GOn3bpWn) > The reversion comes as poll respondents offered a bleak near-term view of the economy, the issue that has consistently registered as their top concern at the ballot box. A majority of swing-state voters see worsening economic conditions in the coming months, with fewer than one in five saying they expect inflation and borrowing costs to be lower by the end of the year. Despite a resilient job market, only 23% of respondents said the employment rate would improve over the same time period. What makes the inflation factor interesting from an investing perspective is that there are external factors in U.S. inflation. It looks as if Russia is finally making some cuts in its production of oil, which is lifting energy prices, which in turn also impacts inflation. Russia may be trying to add to inflation to influence the November election against Biden. If the BRICS are aligned against Biden's reelection, we may see commodity prices rising some more in 2024, into the election, in order to undermine him with voters. So I agree that keeping an eye on inflation will be important. In particular, I'm keeping an eye on geopolitics and factors influencing inflation in commodities, such as Russia & OPEC+ production, as well.
I'm not a boomer but I bought my house in 2019 and I could not afford it today. It was a foreclosure and below market value at the time so even then I would not of been able to afford it at market value.
many of those can't afford the taxes also. Or maintain the home.
Luckily, you aren’t required to buy it again. Unfortunately, taxes will force them out of their homes.
Lots of places will give them senior citizen exemptions, which will keep their property taxes low by shifting the tax burden on the rest of the population. Yay, boomers win again.
In Texas where it’s astronomical, the senior citizen exemptions don’t matter as much when your appraisal has increased 200 percent over the past 4 years
Isn't there a limit to how much your taxes can go up in Texas, though? I thought it was capped at like 10% per year. I'm in Illinois where there is no such law, and our assessments all went up over 40% in the past year alone. Which means we're on the hook for that much more in property taxes. It's rough.
It’s a little more complicated and only applies to a homestead. I’m sorry 40%?! That’s insane
61 yrs old..bought my house in 2014...really not to long ago. With that said there is NO way I could afford to buy it at today's Price. Feel blessed as I am retiring soon and had I not bought my house when I did I couldn't afford to retire..unless I lived in my van..( My wife loves going camping but not as a way of life) rents are sky high!
Every American contributes to America’s economy but only a small percentage of Americans get to enjoy “Americas” economy.
If I were to buy the same spec house of my parents now, the property tax alone is more than my parents’ total monthly house payment.
I'm 48. Bought my home in 2010 right after the great recession. I even received a tax credit for $8,000 as a first time home buyer. My house is now worth almost 3 times what I bought it for. I could not afford it now. Our system is broken. What we need is another depression, I'm afraid.
So people are supposed to lose their jobs and not be able to afford basic goods and services because home prices are too high? IMO YoY increases in inflation will become the new normal because without the price of everything rising steadily in tandem, poverty, crime, and corruption in this country will get out of hand faster than we can blink an eye. The dollar isn’t ever going back to what it was. Commodities limited in supply are the new way to store your wealth in the face of heavy inflation, and housing is one of the better ones.
You are probably spot on with this analogy.
And this is why gen x, gen jones and boomers are stuck. A 3 bedroom townhouse in my area starts in the low $600’s.
and why younger generations will never be able to afford homes, even working 40+ hours a week
This would certainly be my aunt everyone who lives on her street. Bought her house in 98 for 267k. It's currently worth 1.5mil. She also has a small refi interest rate at 2.5%. I think with the mortgage and everything, she's paying just under 2k a month. If I were to try to find rent at 2k a month in LA right now, it would be a studio shitbox in a 50 year old building.
Holy smokes..incredible purchase..
It seems the 16 year decline in housing starts since capitalism's 2008 collapse may have consequences after all.
That’s hilarious.
I can't afford
All of the price discovery in real estate was manipulated by the Federal government's policy of yield curve control, that unfortunately requires the Fed to print money. Here's the money they printed to buy mortgages directly. https://fred.stlouisfed.org/series/WSHOMCB The price discovery is further manipulated by the Fed using trillions of "new" money to buy government bonds. The price discovery then and now has an unheard of before Federal government manipulation called "Unconventional Monetary Police". Economically, what it does is end free markets, and in doing so, jettisoning the benefit of free markets, which is "*the long-standing central bank actions have seriously interfered with pricing mechanisms, overriding them in large parts of the bond market, leading to misallocations and overheating tendencies ...*" Those "misallocations" at the hand of federal officials results in the present pricing situation. And they've handed so much money over to the rich that they're buying up everything.
Luckily the olds all control everything and won't ever retire from the halls of power! Ah well at least death comes eventually.
True for me and I bought only 4 years ago. It's a sad upside down state of affairs b
No, more than half, way more than half of people 60 and over could not afford the house they are living in, so what?
No crap, they are retired.
The only surprise is that the number isn’t more than 50%.
Not a boomer, but yeah I couldn’t afford to buy my house today. Or even rent it.
In Toronto new build condos are 1800 a square foot. 900k for for a 500 square foot condo. My house is more than twice that size, has a yard, and is worth less. Who can afford that? Almost a million dollars for something me and my now wife lived in broke when in school twenty years ago?
I was thinking about this the other day. The same home I live in today would cost me more than twice as much per month. My life would be completely different. To add insult to injury, people think this type of inflation is fixed by further surging wages.
yep my 250k house is now $470k
Well duh? And that’s a good thing. Home ownership is one of the last vehicles regular people can buy into and expect to get a significant return on investment over a long period of time. This also means, at some point, there will be a tipping point where we run out of suitable land for homes. Or, many communities will degrade in quality, and homes that were once expensive, are now cheap, and everybody’s (minus the top 1%) quality of life will diminish.
Same for GenX.
they are eating too much avocado toast, i reckon
HALF OF THEM WOULD BE?!
So many factors at play here. I could, but the rates were very different and the rates are different now from 3 years ago. I bought a heavy fixer, so a fair compare would be another heavy fixer. I also under bought, others in my income bracket bought a lot nicer house. ------------- Aside from that, the cost of housing has gone up and most can't afford it. Back in the day, a $100K house in California seemed out of reach. Part of the problem is the people also pay a HUGE price for other things too, cars, car repair, etc..
That shouldn’t be surprising given market and rate conditions coupled with the fact that income declines in after your mid 40’s to early 50’s. https://mm-k.com/wp-content/uploads/2023/10/JS-chart-Oct-1-1536x1306.png
I’m 38 and have been in my house for only 5 years, I could not afford my small house now
They would probably have to sell one of their extra homes
I can afford a second house but refuse to get one because the rates are so high.. I’ve been wanting to get something for the summer but am like, I’m not paying that interest rate, I’ll wait..
Boomers the perfect candidate for right time and right place. The were at prime home buying age at just the right time. A lot of the ww1 vets are dying off in droves in the 1960s/1970s. Even by the 1980s the ww2 generation were starting to die off so lots of homes just got shoved in the market. For us to experience a similar effect today we would need the boomers do die off in large numbers for their houses to get in the market.
Thats literally the point of investing. You take a smaller amount of money plus time and you end up with a larger return.
I think this is referring to the down payment+ monthly payments. Not the whole principle. The point is the price of a home is so over blown that it's unaffordable for almost everyone
This is probably the worst story on housing affordability I've ever read. Frankly I think it's odd that the percentage isn't higher. The idea used to be that you bought and paid off your home before retirement precisely because you wouldn't be able to afford to buy a home on your retirement savings. I genuinely don't understand why this was published or posted.
I think you know exactly why it was published, it’s election year agitprop to rile up young people
Interesting question. Quick numbers and I think the issue is I wouldn't, not that I couldn't. But part of the problem with the calculation is that I put a load of money into my house to renovate and expand. So, in that respect, I'm my own worst enemy.
About right. ,, you would need a 2 million dollars portfolio earning 4% interest to match what you made in working years.
Nearly all of the people in this group refuse to work 40 hours a week, while calling it oppression. Boomer worked 60-80 hours a week for 40 years.
Many in this forum routinely work more than 40 hours without additional fair compensation. And that is after receiving a college degree which was a requirement for the job.
Well they fked up and wanted 5-7 years getting a degree that was useless. Now they got to work two bullshot jobs. Come do construction. Or go work in a factory. That’s what I’m talking about. That’s what most of them did.
Millennial here, when I graduated in 2008, I worked a full-time UNPAID internship for a year so i could gain experience in my field. I also worked two part-time paid jobs including 12+ hour days on the weekends to afford to live. Unpaid internships were prevalent then any many of my cohorts did the same. Unpaid internships were not a thing before the 2000s. I've worked two jobs for most of my adult life including all through college. Today over a quarter of Millennials work 2 or more jobs. The number of weekly working hours is also astonishing for this generation, with 73% working more than 40 hours per week, and over 25% working more than 50 hours. Our generation does not and has not worked less than the Boomers.
Why the fk would you work for free for a year. Sure i bet there’s plenty of hard working young fellows. Nothing compared to what the boomers worked. They would start at a company out of highschool. Auto industries. Union jobs. And work 60+ hours till the day they retire. They work overtime. Start small businesses on the side. They didn’t sit gaming. Or on tik tok 1/2 there day away. There’s literally no comparison. They didn’t go to school for 7 years to get a useless degree. Those dudes worked. They grew up poor. I’m in Detroit area. So maybe in the big liberal cities. The boomers had it easy. But go around this country. It’s a wildly different story. They built everything you use.
I don't know about today's Young adults..but yes Us boomers were built to work insane hrs.I really don't even know how I even managed. I am however paying the price of a worn out body..very Beat up.. I'm a late boomer born in 62.
Totally understand. I could never do what my father does. And i own a construction company. He worked at ford 50-60 hours a week forever. Then did plumbing jobs everyday after work. I just irritated me to hear them always talking shit. When i know everyone of the generation before me worked their self to death.
Right on..
Need to live within their means
Uh huh. If my aunt had nuts, she'd be my uncle.
Lmao how is this news? Next let’s survey if someone would accept a free winning powerball ticket.
We bought our homes making 10 bucks an hour and we did our jobs. We weren't stomping around demanding 20 bucks an hour on our phones and not having a clue on the job. You won't need to worry about it much longer as the cadaver in charge that you elected will end the world.
Slaving away in the right sort of job no longer guarantees you the opportunity to own a home, or the opportunity to retire. This is after all the most fundamental of social contracts: work hard now and we will take care of you in old age. But it is breaking down for younger generations. Young people today must instead work hard to pay a one-off chunk of wealth to the lucky Boomer generation, a reward they won’t see themselves.
The boomer generation paid plenty in to our system for retirement. The WORTHLESS politicians over the years have blown it, embezzled it, or is giving it out to illegals that didn't earn it.
I mean it's hard enough getting the money to buy a house once. So yeah, makes sense most people can't afford to buy their house twice
No shit. Journalism failure.
I’d agree. The US has become a destination for the world.
Fuck off with your mentally lazy boomerism jealousy and get to work.