I don't understand why this generation can't afford a home. When my grandfather was 18, he had already saved enough money from his paper route and various odd jobs to buy his first home. By the time my father turned 26, he was already married, had his first child, and was moving into his first home. We lived frugally, and our parents taught us the value of spending wisely.
Today's man-children, at the ripe old age of 40, still cannot afford a home. Yet they have no problem eating out every day, going to the movies, and buying popcorn and avocado toast. Add in subscriptions to ten different services they barely use, and that's money thrown out the window. They don't see the correlation between their spending habits and their inability to buy a home or save money in the first place.
I understand that my grandfather's house only cost $12,000, and my father bought his for $50,000. Mine was much more expensive, I paid $150,000, and that house is now worth a million. I understand that by the time my children are 26, it will probably be worth $10 million. If they start saving now, they'll have a shot. But I can tell they will choose reckless spending over saving, and I simply do not understand this generation.
/s
Last week I found a flyer wedged into my front door from a real estate agent in the neighborhood. On it was a list of homes she had sold, each entry showing a picture of the house and its sale price. The cheapest was $970k. For her, this was a record of her work. "Hire me and I'll sell your house," a calling card of bragging rights. For me, it was a nightmare.
I don't live in an affluent neighborhood, yet somehow all the homes are worth a million dollars. Thirteen years ago, a colleague of mine bought hers in this same neighborhood for around $200k. It was a savvy investment. If she sells now, she'll get at least five times what she paid.
While that price was reasonable at the time, meaning you could dedicate a third of your salary to your mortgage, at a million dollars, you're paying far more. That's between $7,000 and $10,000 per month. Good luck finding a job that pays three times that. To satisfy that requirement, you'd need to earn $250k to $360k a year.
Cutting back on avocado toast or prepping your own meals won't save you nearly enough. If you squint and stretch your imagination, maybe it's possible to afford these homes, not by cutting back, but by finding new sources of income.
But what about the next generation? My kids. When they're in their 20s and 30s, how much will houses cost? If we continue at this pace, the wooden houses in this neighborhood are going to cost at least $10 million each. And we'll call the next generation even lazier. Maybe we'll tell them they're splurging on water bottles. "Back in my day, we drank tap water." Or maybe they're not using Grok enough to come up with a smarter financial strategy.
I don't think this is sustainable. The only way forward may be for everything to collapse first. See you at the homeless camp where we'll all end up.