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appreciate the feedback, especially from pierretong1991 and twingles ..... puts things in perspective. In so many ways us Baby Boomers dodged many of the things later generations have had to endure.
Sorry, this is a pet peeve of mine--people who think millennials aren't buying things because we don't want to. Sure, some don't want to, but largely we just can't afford it. I pay the equivalent of a mortgage every month in student loans. We will buy homes (and cars, and whatever else economists want to complain we're not buying now) once we can get the money together. It's just going to be about a decade past the age when our parents bought homes because, as a generation, our economic situation is radically different than our parent's. Unless you'd like to give us some money from your pensions or social security (which we also won't have) for a down payment?
If you would put some of that expensive education to use and research first time home-buyer programs then you would learn that you don't necessarily need that 20% down payment. Further research will show you that rent payments are fast approaching the same amount or more per month than the average monthly mortgage due to historically low mortgage interest rates. The interest rate on my first home mortgage back in the early 80's was 12.5% when the average rates today are only 4%.
Boomers didn't waste their money buying the latest electronic gadgets and gizmos because they just had to have it, getting useless multiple tattoos and body piercings, or going out to eat several times a week...and I'm not suggesting that you personally are doing those things.
Life is not easy. But everyone makes their own choices that they alone are responsible for the resulting life successes or failures and trying to pin your situation on the generation before you is just a cop-out because research again will show you that every generation has had their share of crap to deal with. I grow tired of listening to millennials who think they have had it so bad when in fact, thanks in part to the boomer generation, they have it much better than we did.
Research is showing that the millennial generation is forgoing the once cherished tradition of purchasing a home. For many of us 'Baby Boomers' our greatest asset is the equity we have built up over the years by buying rather than renting. In my case several hundred thousand thousand dollars. If I had chosen to rent through the years and perhaps taken the easy route (no maintenance, freedom to move at will, etc) I probably would have payed about the same in rent as I did in mortgage.
I can see singles or childless opting for urban rentals and walk to work and bars but I can't really understand why families would choose to rent.
Lots of very smart folks on this CD forum so I would appreciate insight. Maybe things have changed and I am looking at things totally wrong.
If I were a boomer and my biggest asset was just a few hundred K in home equity I would be pretty nervous about retirement personally.
On average millennials save quite a bit more than their boomer parents and also don't treat their homes as ATMs.
In many areas of the country investing your down payment instead of sinking it into an overpriced piece of real estate coupled with rent being quite a bit less than comparable homes means you'll come out ahead long term. I'm looking at you CA, FL, and the entire NE.
One just needs the foresight to see their plan through to the end.
Millenials also quit their jobs every 2-3 years and move on unlike our parents who probably worked at the same job for a decade if not longer. This keeps skills fresher and gives higher earning potential as you shop yourself around.
Millenials are about quality of life over income. We keep our expenses low and strive to live a better life than working for "the man". I worked 10 days last month, and didn't even have vacation. This month is one of my three 2-week vacations that I will be taking plus I have another 7-8 days off throughout as well. My parents only took two weeks over the summer when we were growing up (had to pay for those new cars and nice house).
Another reason is millennials probably won't have social security and practically zero chance of seeing a pension unless they work for the federal government. That means we must provide our entire retirement ourselves. This means saving 50% of our income if we really want to be able to retire without eating cat food, now factor in student loans and you see why there is less money left over to purchase a home.
If you would put some of that expensive education to use and research first time home-buyer programs then you would learn that you don't necessarily need that 20% down payment. Further research will show you that rent payments are fast approaching the same amount or more per month than the average monthly mortgage due to historically low mortgage interest rates. The interest rate on my first home mortgage back in the early 80's was 12.5% when the average rates today are only 4%.
Boomers didn't waste their money buying the latest electronic gadgets and gizmos because they just had to have it, getting useless multiple tattoos and body piercings, or going out to eat several times a week...and I'm not suggesting that you personally are doing those things.
Life is not easy. But everyone makes their own choices that they alone are responsible for the resulting life successes or failures and trying to pin your situation on the generation before you is just a cop-out because research again will show you that every generation has had their share of crap to deal with. I grow tired of listening to millennials who think they have had it so bad when in fact, thanks in part to the boomer generation, they have it much better than we did.
I know many millennial who are taking advantage of first time home-buyer programs.
By the way, why are people forcing people to buy houses here? As far as I know, adults are capable of making the decisions that are best for them financially whatever the situation. What's wrong with someone not owning a house? This is America - nobody is forced to get married, have 2 kids, a house and a car. People can decide what makes them happy.
Sort of reminds me whenever people or families want to move to Raleigh and find a place where they can live without a car or with one car and then everybody asks why they don't just get a car (or another one) and doesn't answer their question. It may make you happier in their position but maybe it's not what they want.
To echo what others have said, my house is not my retirement plan or investment - it's just a place for me to live that I chose. I'm still putting away money each month in my Roth IRA/company retirement plan.
Owning a home is really not a good investment. It's a great thing to do if you want to own a home, but there are a lot better ways to invest your money.
Quote:
https://www.forbes.com/sites/jamieho.../#e6dd7f326050
According to research by Yale economist Robert Shiller, one of the foremost experts on housing in the U.S., noted that from 1890 until 1990, the real inflation-corrected prices of homes showed almost no change. This is a surprise to many people, as most people expect to be able to sell their home for a gain in the future. For the first few decades of the 20th Century, housing prices decreased and we saw real decreases again in the 2000s. However, the lesson that housing prices can go down is often lost on people.
If you would put some of that expensive education to use and research first time home-buyer programs then you would learn that you don't necessarily need that 20% down payment. Further research will show you that rent payments are fast approaching the same amount or more per month than the average monthly mortgage due to historically low mortgage interest rates. The interest rate on my first home mortgage back in the early 80's was 12.5% when the average rates today are only 4%.
Boomers didn't waste their money buying the latest electronic gadgets and gizmos because they just had to have it, getting useless multiple tattoos and body piercings, or going out to eat several times a week...and I'm not suggesting that you personally are doing those things.
Life is not easy. But everyone makes their own choices that they alone are responsible for the resulting life successes or failures and trying to pin your situation on the generation before you is just a cop-out because research again will show you that every generation has had their share of crap to deal with. I grow tired of listening to millennials who think they have had it so bad when in fact, thanks in part to the boomer generation, they have it much better than we did.
Yes it's true rates are quite a bit less then they were way back when.
The problem is the DTI ratio has gotten stretched as home affordability is based off payments. Interest rates going down means lower payments means higher home prices relative to income.
You're really just robbing from peter to pay paul here.
In Sweden things got so bad they had 140 year mortgages. Japan had 100 year mortgages before their housing collapse (that they haven't recovered from 35 years ago...).
Owning a home is really not a good investment. It's a great thing to do if you want to own a home, but there are a lot better ways to invest your money.
To echo what others have said, my house is not my retirement plan or investment - it's just a place for me to live that I chose. I'm still putting away money each month in my Roth IRA/company retirement plan.
Every dollar you put in now at your age is worth $10 come retirement time at age 60.
I wish I had saved every penny I earned when I was delivering newspapers as a kid in grade school. I had no idea. My father received a military pension so he didn't do much investing (didn't have to).
Owning a home is really not a good investment. It's a great thing to do if you want to own a home, but there are a lot better ways to invest your money.
Well maybe so ..... I just know that by paying mortgages over the years instead of rent (both probably being about the same) I will be leaving my 3 kids about a $100,000 each just in home equity when I pass.
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