“If they feel like they're locked out of owning a home it colors their perceptions about everything else going on in their financial lives,” Zandi says.
Few milestones in life mean as much to the American Dream as owning a home. And millennials have encountered the kind of trouble totally befitting their generation, which largely graduated into the teeth of the disastrous post-2008 job market. Just as they entered peak homebuying and household formation age, housing affordability is at 40-year lows, and mortgage rates are near 40-year highs.
The anxiety this generation feels about the prospect of never owning their own home affects their entire perception of their finances and the economy, says Moody’s chief economist Mark Zandi.
“If they feel like they’re locked out of owning a home it colors their perceptions about everything else going on in their financial lives,” Zandi says.
Millennials have long been dogged by a brutal housing market. They faced not one, but two, cataclysmic economic events—the Great Financial Crisis in 2008 and the pandemic in 2020. Both of which left them reeling financially and struggling to afford a home. The Great Recession decimated the real estate market as the economy nearly collapsed under the weight of tenuous mortgage backed securities. While the pandemic brought with it a remote work boom that caused millions of citydwellers to flee to the suburbs, sending housing prices soaring.
They really need to STFU with this "Millennials" crap. The entire population aside from the rich are being affected by the now destroyed economy. Nobody is getting a house outside of unusual circumstances.
Also stop treating millennials as teenagers. We're pushing 40 my guy, not our fault yall killed the idea of retirement and are still hoarding what good jobs aren't killed off in your late 70s.
Wait, we are millenials? I thought that's folks born after 2000. What are those then? I'm totally out of touch apparently. Thought with my 39 years I'm in boomer territory.
I loved going to my grandfather’s house as a kid. It wasn’t mine, but it felt like it belonged to all of us. He built it with his own hands. I put my little handprints in the basement. My aunt inherited it when he died. I can go there today and look in the closet where I wrote all of my relative’s phone numbers on the wall for emergencies when I was 5 years old. Every one of his grandkids can go to that house and see their life everywhere. They can feel connected to their family and their memories.
My aunt’s kids have grown up there now, her daughter graduates this year. She’ll be able to have that same experience.
If I ever have grandkids, they’ll have to drive by the shit apartments that I’m stuck in and feel nothing.
Millennials existed in a world where they seen ownership, experienced ownership. Our movies belonged to us. Our games belonged to us. Everything is a service or something we can’t afford.
I love my Steam Deck, but nothing on it belongs to me. That is the world I live in from the top to the bottom.
If I want to remove the ugly 1970s wood paneling and paint my living space to match me as a person, nope. Gotta ask my fucking owner and he’ll say no. He could sell it tomorrow or die, and if they tell me to get lost, I gotta get lost.
I took over payments on my childhood home when I was 21. The roof hadn’t been repaired in my lifetime. When I was a kid I put a tarp over my desk to keep the rain from destroying my computer. When I was 23 I fell through the floor in the bathroom.
If I had known just how hard it would be to obtain a place of my own, I wouldn’t have let that place go. I would have lived in it until it collapsed. If I could go back in time I’d tell younger me to suck whatever dick I had to suck to keep it, right there in that terrible poverty stricken hellhole of an Appalachian neighborhood.
My mom bought that place for 40k. 5 bedrooms. A huge house. We were poor so we couldn’t keep with repairs, but it was ours.
I don’t know. Bums me the fuck out. I’d love to have a home for my children.
There’s 19 of us. 3 of them have passed away so that brings it down to 16. And for fun, we all have 29 children between us, I have the most biological children at 5, 2 adopted making my total 7. Most of them stopped at 2, but one of my cousins has 3. They all think I’m insane, and they’re not wrong. :p
Damn. We’re a bunch.
Edit:
Why would anyone downvote this? Seriously. It isn’t controversial. Are you mad that I adopted kids? Mad that I’ve been married twice and the second one wanted kids? What?
Are we supposed to think it’s normal that millennials are the first generation in modern American history who will die younger and poorer than their parents?
On average a quarter of millennial parents’ combined income goes to childcare. That is bizarre and unprecedented. Is it normal that they have 1/10th the wealth their parents did at the same age? That very few of them will retire?
People are unhappy because their lives suck. Millennials have iPhones and cars, sure. But these are toys. They aren’t important. What’s important is family, community, access to nature, good health, education, accomplishments, creative outlets, hope for the future. Instead we have YouTube and Samsung and other distracting material garbage that all the neoliberals think amounts to anything. Ridiculous.
I think the most painful thing is how nihilistic our culture has become with just...being ok with this. Like yeah, we're supposed to think it's normal.
Then you look over at Zoomers and they're gleefully making unintelligible memes about how everything is doomed. Hopelessness is their comedy. It's sad.
Right now, we're pissed off and want home ownership and the concept of retirement back.
Are they trying to wait us out until the younger working class isn't even familiar with the concept? Look what happened to unions, until people finally started digging it up and bringing them back into fashion.
We must absolutely refuse to forget this, and just beshruggingly accept it as normal.
I think the most painful thing is how nihilistic our culture has become with just…being ok with this. Like yeah, we’re supposed to think it’s normal.
Boomers won't admit to causing most of the issues and keep making things worse. When the only solution for Millennials appears to be fighting Boomers for their lives it's no wonder many choose to just... check out mentally. It's parental abuse on a generational scale.
A lot of what you're talking about is discussed in Elizabeth Warren's (now 20 year old) book The Two-Income Trap.
The central premise is that, as many middle class women entered the workforce, you would think that two working parents would be a way to get ahead in the economy, but in reality the combined incomes of two professional adults with children just became a "new floor" of sorts, for a number of reasons.
Multiple SUVs, the ubiquity (and perceived necessity) of consumer electronics, childcare costs, and emphasis on living in premium housing areas for the good schools... all good life improvements in their own right, but definitely eat into the supposed "gains" of adding a second income. Even in high income areas people ratchet their expectations and living standards up, so earning six figures each is sorta like the bare minimum. Will you have more "stuff" than a poor person? Absolutely. But that doesn't equate to quality of life necessarily.
"I'm not a soulless boomer telling people pull themselves up by their bootstraps, I'm just giving honest and mathematically correct facts!"
Then begins to list off pretty much everything from don't make avocado toast to just move out of the city, despite you not maybe being able to afford that.
Then tells a person to stop caring for his father and let him live uncomfortably, possibly even die, just so that they can get a house based on some really flimsy and very personal philosophies.
Same boat. I want kids but want to stabilize living in a house with my wife first. Now she's at a age where if we don't have kids soon she never will.
So there goes my dream I guess.
Right there with you brother. We're still living in an "extended family" arrangement. We were trying to be "stable" for so long too first. We decided to try anyway, and...I find out my cells are somehow not up to the task.
How so? Dunno. Should be an easy fix maybe but all we've gotten are vague answers. Possible solutions are locked behind the "lol insurance never covers reproductive health for men" paid DLC of The Best Most Enviable Healthcare System On The Planet. Of course.
But...We don't stop trying. I guess we have to figure out unconventional ways of making things work and getting by right? The way we were taught to play the game is all wrong...
I pray you and your wife can have what you want, despite the circumstances always being less than ideal. We're a generation of survivors, if anything.
The only way it's remotely viable is if you're willing to move out to the middle of nowhere. I've decided to go that route, with only about $200,000 to my name I was able to buy 4 acres of land and get a pole barn put up and turned into a house.
The trade-off is that I'm about an hour and a half out from the nearest actual City the only thing nearish me is a tiny town with a population barely reaching for a thousand of primarily retired elderly people
But I decided that this was better than feeling trapped in the city forever in shitty apartments with ever increasing rent
It's a shame that FHAs are gatekept with PMI, even for those with great credit. I'm on a VA Loan which is probably responsible for the vast majority of mortgages in my age group ('96). With good credit on FHA you only need 3.5% down minimum but will need to carry PMI either way which has been historically expensive and has never gotten cheaper. Tack on the considerable rise in both interest rates and prices at the same time the past year or so, it all looks pretty bleak. I am just so fortunate we locked in at 2.35% in an area which hasn't ever seen decline in home values other than a blip in '08, but it took military service to even qualify for. This doesn't even bring up my degree being free.
It's just wild how large the gap is growing, my younger brother ('02) works as a mechanic and as a manager at a furniture store, his girlfriend is a team lead at the furniture store, they really can't afford to just rent on their own and this is rural Delmarva. Houses that were built new not even 10 years ago for $120k are now $280k+. My thing is full-time workers shouldn't have to worry about the bare necessities but even mid-level jobs only paying $18/hr is just gross. I'm the only college grad in my family and work in big tech now and it's just silly how much of a game upward mobility, heck, just stability, is getting.
I feel trapped in my house now. I just barely squeaked by in 2017 and got a house for a decent rate/price (what now seems like a steal compared to current prices), but I feel like I can't really go or do anything else now. I'm just stuck in this situation until either the kids move out or until my spouse or I dies. Like yeah, the price of my home went up, but so did everybody else's, so I'm probably only looking at downsizing in a decade or so, otherwise, there's not too much else to strive for, just building up retirement money, hoping it'll last me past until I get diagnosed with some major medical condition or if I even ever live to see a day of retirement.
I am so glad we managed to buy something in November 2019. Our state (MD) even had a first-time homebuyer program that gave us an interest-free ‘loan’ to get us out of PMI, only needs to be paid back if we sell or refinance. We make it work on 75k/yr total income somehow, although it’s gotten harder and harder. Seriously, we had a small car payment ($250/month, paid off in the last few years) when we bought the house that we could probably not afford now. We also have to basically restrict eating/going out to special occasions only, but that’s not so bad.
Just thankful we were able to find a decent modest home in a nice little town in our state. My heart goes out to everyone struggling now!
Edit: also meant to add that going by what Zillow says our home is ‘worth’ now, we couldn’t afford it today.
There's a large quantity of influencers profiting off of doomsaying and convincing millennial they can't afford homes with bad math and bogus statistics. They churn out clickbait content with unfounded claims, purposefully designed to rile up viewers and drive engagement.
This of course applies to many topics, housing affordability just being one, that turns out drive big engagement by spreading disinformation.
It's actively profitable to lie on the internet nowadays, so lots of my fellow millennials have an extremely soured and warped perspective of reality, because if you keep getting told lies by enough different random strangers on the internet on a topic you aren't familiar with, you'll start to believe it.
Spreading disinformation, especially about serious topics like economics, medicine, politics, religion, etc, needs to be cracked down on more. Posing as a professional online and spreading damaging info on purpose should result in jail time imo.
I'm not seeing any lies there. I worked my ass off my entire career and still have to go back to school to get a little piece of paper that lets me do what I do in a clinical setting. I've got 2 degrees already, almost a decade of experience and I'm even decently-paid, but thanks to the cost of being alive I was forced into even more schooling to open up a few more doors in the long run. I'm feeling exactly like this article, I've given life everything I've got and the bar keeps getting higher and higher, its soul-crushing, I'm just so tired.
Something I’ve noticed about lemmy is that people here love their anecdotes. Something I miss about Reddit is that data seemed to be held in higher regard.
I don’t mean to single out your comment but this is also a reply to the one above yours.
According to the Census Bureau’s Current Population Survey, homeownership rates for millennials sat at 51.5% in 2022, compared to 56.5% for baby boomers in 1990 and 58.2% for Gen X in 2006.
So maybe lots of articles get written about this because it’s a growing problem but also our personal experiences might not be indicative of a larger trend (although yours seems to be).
So... you paid for two degrees already and are going for a third, and you are having financial issues?
Do you have all three of your degrees fully paid for (all debt on the first two gone, and enough money for the third without having to take out a loan)?
Otherwise it sounds like you are bad with money. Taking out huge loans you can't afford isn't the path to affordability. It's pretty rare that degrees are a good financial investment.
Degrees are mostly a passion investment. You need to already be well off enough to afford all the extra costs to get the degree, abd you are paying money to do a job you like after.
There's tonnes of jobs that pay incredibly well that don't require a degree at all.
Taking out a large loan to get a degree is a terrible financial choice.
If you just care about finances, go work a job that pays well and has a low barrier of entry that anyone with a pulse can get into.
If you want to do something you are really passionate about and it's financial investment sucks, that's the tax you simply pay to have a job you prefer.
The intersection of:
job pays well
it isn't dangerous/strenous/awful hours/tough
it doesn't require a degree and thus a huge loan, thus isn't a poor investment
Is extremely rare. There's a couple trades that aren't too bad, but they usually pay well due to a low demand low supply situation.
Lol warped perspective? Millennials are the poorest working generation since the great depression. Millennials, the largest working generation ever in America only hold ~3% of the wealth. Our parents at the same age owned ~30%. So Ya shut up
Don't need a professional expert to acertain whether the market is sour. Where I am the cost of renting a one bedroom apartment is around $1800 a month plus utilities on the low end. Mind you I am in a city but is you drive an hour and a half away to the farthest "commutable" burbs you are still looking at rents that are $1400 for essentially a one bedroom basement suite.
There are a lot of people my age I know who are working proper professional jobs double income no kids situations who are never able to save up enough for the initial down payment for a house. Why would they when they face so much precarity? Whatever money they are able to sock aside for a rainy day might only cover a car repair or some time off work if they have a life altering event like a parent dying and paying down chunks of student loan.
They wouldn't be able to handle paying for repairs and maintenance for an actual property while still paying high mortgage. Practically every early millenial I know who didn't start making their nest egg through a job in trades right out of high school and instead spent time in the post secondary system getting a degree got bit.
Where I am the cost of renting a one bedroom apartment is around $1800 a month plus utilities on the low end. Mind you I am in a city but is you drive an hour and a half away to the farthest “commutable” burbs you are still looking at rents that are $500 for essentially a one bedroom basement suite.
So a suite halfway between the two for ~1100 probably exists 45 minutes away, which sounds completely workable and average.
That only sounds marginally worse than pre2020 when it was closer to ~1000.
That sounds pretty normal mate and not that unaffordable.
I don’t think this is as important as your making it out to be because it’s not far off from the truth for many. The reality is that a condemned or empty lot in my area starts at 6 times my annual salary. To get something that can be lived in starts around 9 times. That means I need at about a year’s salary to afford the land alone. To be able to live on that lot is closer to 2 years salary. Realistically this won’t happen because the rent in the area is 60% of my income and after required expenses like fuel, insurance, food, etc I can usually save about 5% of my income. Any unforeseen expenses like car repairs eat that away, so I’m left with an annual savings rate of about 3%. At this rate homes will inflate faster than my income will accrue. The math doesn’t work and I suspect it doesn’t for many others.
They aren't lying. The housing market has become incredibly prohibitive due to how property prices have gone up with speculation and demand.
Maybe the older millennials can afford a home eventually, but they'll be 10-15 years behind their parents into achieving that goal.
Even in Canada, in the cheapest city to live in, Montreal, 1 and 2 bedrooms go for about 400k. Houses are over half a million. You can't afford these with our average wages unless you're in a couple and have a very solid down payment.
I'm with you. In my area which has traditionally been very affordable (mountain ski town in CA), houses are now starting at $500k for absolute pieces of shit and only go up from there. Most of the housing stock up here is compromised of second/vacation homes, many with deferred maintenance due to absentee owners or have been thrashed by years of partying tourists/local renters. A number of these houses should be condemned, but they still fetch a premium.
At this point, it would be cheaper to build a house, but lot prices are through the roof ($100k starting for anything remotely with a yard, no financing possible on land here), and lumber/materials are insane as well. I'm in construction and have plenty of friends in as well, so it's certainly feasible. And at the end of the day, building our own modest bungalow and expanding as money becomes available would still be cheaper than buying an old piece of junk requiring all the repairs, especially with the reduced maintenance costs and building to modern efficiency standards.
Ten years ago? Sure. I remember basically everyone insisting there wasn't any point in even looking for a house until you could break the PMI threshold and how houses were so much more expensive than rent and you would never break even. And I have a few friends who, regardless of what the rest of us said, may have lost their "window" to ever own a home.
These days? It is just the truth that you are fucked. Because unless you can afford to pay considerably over asking price and waive inspections, you are basically fucked outside of unicorn scenarios. And... basically the only way to amass enough wealth to reach that point is to come from money or have a high paying remote job and actively choose to live in the middle of nowhere next to two trailers with confederate flags painted on the walls.
This is the sorta shit the aforementioned disinformation has been spreading.
As someone who recently bought a home in a major city, we had no issues like that.
Everything was by the book, we got an inspection, paid under asking price by a small margin, and now live in it. We did the min 5% down payment, and our household income was only about 70k total between the two of us combined.
Took us about a year and a half to save up the down payment, but we got there.
Right now there's dozens of homes I've seen up for sake for weeks and weeks, this month.
Mayne your specific city just sucks and you need to move somewhere affordable and sane.
You sound salty. What budgeting software do you use, out of curiosity? I find without auto import support for my transactions and debt tracking, it felt way more challenging to get my finances in lime to save up.
I swapped to Mint at the time (though it's shutting down now RIP) and having that ability to see every penny we were spending lined up really helped a lot in terms of tightening the budget up to improve our ability to save.
We squeezed another $300/month out of our budget, pushing us up from $400/month to $700/month and that effectively halved our time to hit out goal.
There's just so much random shit people seriously don't think about as expenses adding up. My quick energy drink I'd often grab with a snack in the morning otw to work barely registered on my radar, but it was $5 or whatever a day, 3-4 days a week, which adds up to nearly 90 bucks monthly.
Just ordering a bulk box of energy drinks instead and remembering to grab it otw out the door was saving me like $50 a month.
If you don't have specific budgeting tools installed and actively used, you don't really have a leg to stand on (yet) when complaining about cost of living.
Go start there, run the numbers and import your last couple months transactions, and if you truly can't see a few hundred bucks a month you can squeeze than I can sympathize with ya.
Spreading disinformation, especially about serious topics like economics, medicine, politics, religion, etc, needs to be cracked down on more. Posing as a professional online and spreading damaging info on purpose should result in jail time imo.
After four years of having Trump as president, how is it possible that you cannot see how dangerous ideas like this are?
For one thing, it's not merely people "posing" as professionals - i.e. those who have no credentials to show - but the actual professionals themselves who are often the source of misinformation. Remember when Trump told people to drink bleach (and then two guys in Kansas literally did precisely that)? He also told people that sunlight can destroy the virus - I know people irl who when they got sick, they went outside to sunbathe... in the dead of winter, in sub-freezing temperatures.
For another, there are charts & graphs of news media outlets from before being bought out by billionaires vs. after that, which conclusively prove that the name of the buyer is mentioned drastically less often (and most especially in a negative context) after that purchase compared to before it. If "reporters" - the literal card-carrying members of this establishment - cannot be trusted to tell the news, then who can?
To become TRULY informed about something... takes many, MANY years. When I was a kid, I believed in trickle-down economics, because that's what I was told. I even voted based on that. Many people still do believe it, but not in spite of listening to their news organization of choice, and rather b/c of it.
I upvoted your comment bc I think it adds value to the conversation, but ultimately I disagree with your ending sentence: it seems far more likely that those who speak out against "the establishment" will end up in jail, thus turning that into one more tool for those who speak "untruths" to remain in political power, than for the reverse to happen.
My latter statement needs to legally be specifically limited to disinformation on specific topics. Posing as a doctor and giving faje health advice, posing as an investor, etc.
Will it cover all disinformation sources? God no, you are 100% right that major news outlets are a captured market now.
But cracking down on some disinformation is better than nothing.
During Covid 2020, there was a study that found the vast majority of disinformation could be sourced back to like, I want to say it was like a total of only a couple dozen specific people? Like a small handful of trolls basically could be blamed for a huge amount of disinformation. Some of them profited off it.
I think cracking down on the "source" points of bullshit could be a good starting point to at least taking a very large chunk out of the problem.
(100 bucks says many times it will be found to be Russian or Chinese actors at play in one way or another)
For those downvoting, the most effective lies always have some truth to them.
Honestly the biggest reason they can’t afford housing is because the majority don’t know how to budget and/or stick to it. This goes for a large amount of the poor as well. They’re constantly spending their money on consumables and other non-wealth building things. In the US, as a society, we’ve done a shit job of teaching our kids this valuable lesson, pun intended.
Doesn’t mean the value of the dollar isn’t lower than it has been in a while and that mortgage rates aren’t high (they aren’t the highest, by the way; it was at ~12% in the 90s). That food prices aren’t insane and that corporations aren’t taking advantage and jacking up their margins, they are.
This is a lie and you've been manipulated. I've seen poverty and watched people starve themselves skinny for savings. There are individual differences and if your differences make you useless to the economy (where you aren't coerced into seperating from your money for your health) then that's absolutely fantastic for you. But please don't chime in to preach at people who are starving thanks.
How does one budget their way out when the mortgage for a median priced house exceeds half your take-home pay for the month for a median household income?
Median home price in Sept: $412,000
Median household income 2022 (latest census data): $74,580
Today's 30-year fixed rate mortgage rate est.: 7.30%
Down payment assumption 10%.
So your monthly payment would be $3,121.60 while your monthly income before taxes is $6,215.
You're spending well over half of your take-home pay after tax just on the mortgage payment for a typical household buying a typically priced house, which is not affordable even in this extremely generous example that ignores all other fees, insurance, and the fact that you're on the hook to maintain that property.
This is just the "everyone is buying avocado toast" argument which is a rebranded "everyone is buying smartphones" argument. Budgeting isn't going to turn your $30k yearly pay into a $30k down payment and $2,000 PITI payment