Record low numbers of millennials think buying a home is a good investment—here's why

BlackGoku03 · Aug 26, 2018

Shit! This article is talking about me lol.

I make a decent wage but I'm the only one working in a family of three. I can't save up enough for a down payment and my credit is slowly improving, not high enough but getting there. If I had more income, I could fix that too.

So, my solution is to move to outskirts of Atlanta. I know I can get a job at or close to six figures. And my wife can find a job easily. But the houses are a bit more expensive. And the really good paying jobs are in the city proper. I'm not built for that type of traffic... Especially when my current commute to work is six minutes.

Idk what to do.

III-V · Aug 26, 2018

Not to mention the cost of college nowadays which is insane.

Zackat · Aug 26, 2018

I'd love to buy a house. It is just so fukin expensive where I live. I don't even have debt at all and it will still take me years to save up enough for a down payment.

ParanormalFupa · Aug 26, 2018

I ended up buying a house as close to downtown as I could find/afford. I'm a 5 min bike ride to work and everything else. Rent prices are rising fast here, but starter homes in the twin cities can still be found for 150k-250k, but the market is cutthroat with the lack of supply. My mortgage is barely more than what I was looking at in terms of rent, and now I get a whole house. I didn't even need as much cash as I thought I did. 5% down was just fine.

Addleburg · Aug 26, 2018

32. Would love to buy a home. Where I currently live (Los Angeles area), there's absolutely no option for that. There's no way I come anywhere close to having the money for a downpayment, in part due to the minimal savings I have from my cost of renting.

TrueSloth · Aug 26, 2018

Wage growth is so fucking stagnant, I cant see it as an investment. Plus with the fact that you have to move jobs in order to get a raise, there's a lot of uncertainty of where you're gonna live.

Christian said:
I have $130K remaining in student debt, I have a son, and I own a house. You make it work. You don't whine about being afraid you won't be able to eat healthy anymore.

Tell me more about your anecdotal experience that doesnt really apply to majority of the generation.,

BassForever · Aug 26, 2018

I only just graduated college and am renting since I don't plan to live or work in CT long term. Once I save up, pay offs some loans, and move to where I want to live (FL) I'll buy a house.

Mammoth Jones · Aug 26, 2018

III-V said:
Not to mention the cost of college nowadays which is insane.

I don't know why more people don't go to community for two then transfer to a state school. It's so much cheaper.

BassForever said:
I only just graduated college and am renting since I don't plan to live or work in CT long term. Once I save up, pay offs some loans, and move to where I want to live (FL) I'll buy a house.

Move to where the jobs you want in your industry are, lol

mintzilla · Aug 26, 2018

It's important to keep in mind that nobody wants to live in the middle of nowhere. Especially if your not white. So housing will be expensive.

Mammoth Jones · Aug 26, 2018

mintzilla said:
It's important to keep in mind that nobody wants to live in the middle of nowhere. Especially if your not white. So housing will be expensive.

Thanks to gentrification it doesn't matter. It'll end up expensive regardless.

AlwaysSalty · Aug 26, 2018

Depends on where you live, but where I live on CT it's a huge waste of money. Here we have to pay 5-6k a year on property taxes and houses cost about 100k more then the do in cheaper states. The only decently priced homes are either in the ghetto or way out in the middle of nowhere. I've seen condos that have hoa fees as high as the mortgage. CT can fuck off with all that.

golguin · Aug 26, 2018

I gotta have someone to live in my current house once I buy a second so it's good for me that people want to rent. I bought my house because I know how to save. Friends and family that make twice as much as me are swimming in debt.

funky · Aug 26, 2018

Only people I know who own property under 30 fall into the following groups.

Basically got "gifted" a cheap house or apartment during the downturn by family paying the majority of the cost.

In a long term relationship with another professorial and dont have kids.

Moved to eastern Europe.

Daygon · Aug 26, 2018

For me, I need to gain my basic education, diversify investments and have a side hustle/business before I think about a house. With the Home Counties housing market growing rapidly day by day, a home/house will be a tough thing to obtain in the future. Plus, Brexit push a lot of people out of reach of owning a home, the prices are not bad but the lack of secure funding from the banks and the high deposit requirements make it very hard.

Vish · Aug 26, 2018

Christian said:
I have $130K remaining in student debt, I have a son, and I own a house. You make it work. You don't whine about being afraid you won't be able to eat healthy anymore.

This isn't enough information

funky said:
Only people I know who own property under 30 fall into the following groups.

Basically got "gifted" a cheap house or apartment during the downturn by family paying the majority of the cost.

In a long term relationship with another professorial and dont have kids.

Moved to eastern Europe.

Have a bff roomate who share a home.

mintzilla · Aug 26, 2018

Mammoth Jones said:
Thanks to gentrification it doesn't matter. It'll end up expensive regardless.

I mean more small cities and far flung suburbs.

I live in Canada and I would kill myself before I ever moved to a small city or shitty suburb here. It's a hellscape of shitty single family houses, strip malls, power centres and parking lots.

So there realistically only 6 places max worth living (T.O Proper, Montreal proper, Vancouver proper, Calgary proper, Edmonton proper, Ottawa proper) everywhere else fuck no. And guess how expensive houses are in these places.

Meatfist · Aug 26, 2018

There's also a huuuuge fucking gap between being "house poor" and getting a house you can actually afford. I have quite a few friends who are doing FHA loans with only a few % down, and it's scary to think how quickly they could go underwater. The "correct" amount of cash on hand when purchasing a house should be 20% down, an additional 3-5% for closing, a few months of emergency expenses, and another couple % per year to cover maintenance and repairs. No wonder people balk at that number, I'm in a LCOL part of California and that's still $100K for a respectable house

lunchtoast · Aug 26, 2018

I just closed on a townhouse last week. I was lucky enough to use a VA loan, no money down. Not sure what the typical down payment is through a bank loan but hopefully it's not too high for first time buyers.

AmethystArcana · Aug 26, 2018

Millennial who was told growing up to never rent. Bought a house a year after finishing my second degree, but that 100% would not have been possible if I didn't have supportive parents that encouraged me to live at home for my second degree and while saving up during my first professional job. These are not luxuries and opportunities a ton of millennials have, and even with them I still barely made a 5% downpayment.

Akira86 · Aug 26, 2018

all my friends who have houses hate their houses.

but it's better than living on the street.

III-V · Aug 26, 2018

Mammoth Jones said:
I don't know why more people don't go to community for two then transfer to a state school. It's so much cheaper.

Well thats what I did. Still extraordinarily expensive plus grad school.

Titik · Aug 26, 2018

Many millenials also most likely have to adjust thier expectations on what dream housing is supposed to look like. It's increasingly looking like having white picket fences and a hard is no longer sustainable.

Zoe · Aug 26, 2018

20% down is a thing of the past (there's an article somewhere). PMI isn't such a bad deal when rates are as low as they are while house prices continue to rise faster than salaries.

AlwaysSalty · Aug 26, 2018

IMO a good option is to learn how to repair a home, buy a fixer upper, fix it and live in it. Otherwise you'll fall victim to buying a home that's way overpriced from everyone trying to turn a profit. Another is to wait for the crash that everyone knows is coming.

PrivateWHudson · Aug 26, 2018

Meatfist said:
There's also a huuuuge fucking gap between being "house poor" and getting a house you can actually afford. I have quite a few friends who are doing FHA loans with only a few % down, and it's scary to think how quickly they could go underwater. The "correct" amount of cash on hand when purchasing a house should be 20% down, an additional 3-5% for closing, a few months of emergency expenses, and another couple % per year to cover maintenance and repairs. No wonder people balk at that number, I'm in a LCOL part of California and that's still $100K for a respectable house

That's the problem, millennials are too responsible. Gotta be like gen x'ers and do 0 % down and pay pmi. Hell, put it on your credit card if you have to.

Giolon · Aug 26, 2018

I was fortunate enough to buy about 5 years ago for a cracker box condo in the Bay Area. The price for the same is now 70%+ higher than it was then. I don't view it as an investment, but you have to pay to live somewhere, and I'm paying far less in mortgage + HOA fees than I would were I renting. I'd love a better place but can't afford it especially since the Trump tax law changes.

If I need to leave, I can always sell.

thetrin · Aug 26, 2018

Why the fuck would I buy a home? I don't want to live in the same place for fucking 20 years.

Seirith · Aug 26, 2018

mintzilla said:
It's important to keep in mind that nobody wants to live in the middle of nowhere. Especially if your not white. So housing will be expensive.

I would love to live in the middle of nowhere! I'd love a house on land with nothing but fields and trees all around and no neighbors for miles and miles. I live in the suburbs right now because it is close to where my husband works and where my parents are but some day I'd love to have a small farm out in the country with animals.

Mahonay · Aug 26, 2018

I think it's an amazing investment. I am simply way too poor to afford property.

Zoe · Aug 26, 2018

thetrin said:
Why the fuck would I buy a home? I don't want to live in the same place for fucking 20 years.

Most people sell their homes within 5-7 years.

icyflamez96 · Aug 26, 2018

My father always tells me about how buying homes are one of the best investments you can make. He has multiple and makes money off of them. Im not exactly sure the ramifications of it all though.

Squirrel Killer · Aug 26, 2018

jon bones said:
If your job market isn't there and your family isn't there and the schools aren't there, it may as well be a disease.

There are jobs and schools in all the locations I mentioned. Their job markets may not be as big and diverse as say, Los Angeles', but they do exist, two of the locations I mentioned even have unemployment rates under 4%.

Family is always going to be an issue, sure, but I think it's actually the reverse (i.e. people leaving smaller cities and their families to move to one of the fetishized cities even though they don't know anyone there.)

Deleted member 15737 · Aug 26, 2018

Happy with our home purchases. Starter home resold after 3 years, covered the mortgage we paid those 3 years + paying off the home.

To go from paying rent and getting nothing long term to being paid for owning is huge.

Next house was bigger and more expensive but we plan on being here a while. First 3 years have seen it increase ~10% though.

Hard to resist buying more and renting/flipping, but it seems kinda scummy and a potential headache so I've held off.

Jarmel · Aug 26, 2018

Have two separate parents who own houses and seeing both their struggles, owning a house looks absolutely idiotic to me. There's always something that needs to be done.

Vish · Aug 26, 2018

I'm gonna give up on owning a home, having a kid, and material possessions. Gonna focus on retirement and stocks, and pay down my student loans. I'm 32 so I guess I fucked up early on, but at least I can cover the latter half.

I'm also doing something wrong relying on job hopping, I gotta do something else like add a side hustle. Any ideas on how to spot opportunities to make money?

chandoog · Aug 26, 2018

Millennial here. Recently bought our first home which is fortunately very close to both me and the mrs's work places. Can't be happier.

I strongly disagree with renting places, there's no equity, you don't own anything even after years of paying steady monthly payments.

BarringGaffner · Aug 26, 2018

My wife and I are in early 30's and we just purchased a nearly $800k 2 bedroom townhouse in Vancouver. We have no kids but probably will in a few years. We just couldn't find the type of place we wanted through renting.

Really not sure if it's a good investment, I hope it can be, but we bought it to live in it. Luckily the market cooled off recently... the place might have gone for 100k higher last year with multiple offers.

Now we are expecting all financing to go through my Wednesday and to be in the house by mid sept! Stressful experience to say the least but I hope it will be worth it.

Sho_Nuff82 · Aug 26, 2018

Christian said:
I have $130K remaining in student debt, I have a son, and I own a house. You make it work. You don't whine about being afraid you won't be able to eat healthy anymore.

Thorn said:
"Just make it work!"

Great advice.

Mammoth Jones said:
This. Holy shit. No one is saying it's easy. It takes time. It may take compromises in other areas.

I make roughly 2x that amount I joked about, my job has good benefits/security, I'm a year away from paying off my car note, and I have about 1/5 the remaining loan debt that Christian has... and no, home ownership/ having a kid is not just something I can "make work" by buying less avocado toast. My partner and I are in our mid-30s and we're just reaching the point where we can save comfortably (and plan accordingly).

Of course it's not all hopeless, not a day goes by without some of my friends announce they've just bought a new place. But we're mid to upper middle class people in our mid 30s, not twentysomethings with 20 years of babymaking ahead of us. Based on trends, millennial home ownership will come later, and probably be the result of most giving up on their current situations and moving to the new, cheaper, up and coming metro centers in the southwest: https://www.ft.com/content/1a27a524-7496-11e8-aa31-31da4279a601

Somnid said:
How is this different from renting? You signed a lease, you aren't going to get released because you are broke.

Subletting out an apartment because you need to move, broke up, or need to get your money right short term is really, really different from defaulting on a mortgage.

Bessy67 · Aug 26, 2018

Taxes are the main thing holding me back. In my area I could get a decent house for $175k-ish and my mortgage payment would be about what I pay in rent, but the taxes on that are another $5000 a year so that's another $400 a month. I could swing that but it would be a little too close for comfort for me.

firehawk12 · Aug 26, 2018

It feels like the only way to own a house in 2018 is if you are okay with living 1-2 hours away from where you work in some tiny town you'd probably hate living in. Not sure if that's any better than renting an apartment downtown and being able to live a real life.

Mister X · Aug 26, 2018

People should look into minamalism, especially the younger generation.

Puroresu_kid · Aug 26, 2018

Duxxy3 said:
Homes aren't for living in any longer. They're for flipping to turn a profit.

Which is a a tragedy. I own a house and I have not checked once of its value has increased as the house is for me to live in I honestly don't give a damn how to much its worth since I bought it.

Fubar · Aug 26, 2018

My wife and I bought a house a year and a half ago. We were both 23 at the time.

A buddy of mine just bought a house last month, he is 26. My sister and her boyfriend (21/25) bought a house they were renting for the last year, sale finalized two months ago. I can think of a good 20-30 people who I know under the age of 25 who own houses.

It's more rare, I suppose. But it's not as insanely rare as some people think.

Lynd · Aug 26, 2018

chandoog said:
Millennial here. Recently bought our first home which is fortunately very close to both me and the mrs's work places. Can't be happier.

I strongly disagree with renting places, there's no equity, you don't own anything even after years of paying steady monthly payments.

This. But it is hard if people live in big cities etc.

We built 2 years ago, but if we lived in Sydney still we would have no choice but to rent.

GamerJM · Aug 26, 2018

Living in the bay area, I'm never going to be able to afford a home here at market price. I still want to live in one though because I hate not having the space a house offers. Either I'm going to have to work a deal with my parents or move to fuckin' Missouri or South Carolina or some shit. Which I might actually do, just live with my parents for the next 10-20 years while I focus on my career and then just move out there (99% chance I'm not going to get married and like a 99.99% chance I'm not going to have kids, so I probably won't have to worry about those things).

Relix · Aug 26, 2018

Waiting for the next housing crash to buy in.

thetrin · Aug 26, 2018

Zoe said:
Most people sell their homes within 5-7 years.

That sounds like a whole thing. I don't have the energy to do that. I'd rather just close out my rent and move on.

captmcblack · Aug 26, 2018

I would *love* a house, but I'll never have one anywhere worth a damn in NYC unless I'm rich/save forever. Ignoring the hot neighborhoods in the 5 boroughs, you gotta have a shitload just to buy a fixer-upper in bad areas and for the pleasure of a 90-minute 2 transfer/2 fare commute.

Hopefully I'll inherit my folks' home, but more likely I'll eventually get a condo and keep it moving.

Sho_Nuff82 · Aug 26, 2018

Fubar said:
My wife and I bought a house a year and a half ago. We were both 23 at the time.

A buddy of mine just bought a house last month, he is 26. My sister and her boyfriend (21/25) bought a house they were renting for the last year, sale finalized two months ago. I can think of a good 20-30 people who I know under the age of 25 who own houses.

It's more rare, I suppose. But it's not as insanely rare as some people think.

Statistically speaking ~40% of our generation owns homes, which is half the rate for boomers. The rate for people under 35 is ~30%.

https://www.cnbc.com/2017/10/03/zillow-the-top-2-reasons-more-millennials-cant-buy-homes.html

https://www.politifact.com/californ...ling-myths-about-millennials-and-homeownersh/

The median age of all home buyers is 40, so yes, your friends are well ahead of the curve.

Deleted member 2625 · Aug 26, 2018

Foffy said:
Of course, that's in relation to the current framework, which is just a metastasized, near-terminal social fabric.

Oof. Nice turn of phrase, Foffy. That's horrifyingly succinct.

My take, is that we need to further decentralize knowledge workers outside of the cities, as well as universal basic income and other stopgaps.

Record low numbers of millennials think buying a home is a good investment—here's why

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