The problem I have seen among my kids and my friends kids are the baby boomer houses, that we bought because we could afford them and stayed in them, are not good enough for the younger generations. They all want the bigger, better, more expensive homes.
We have a very nice home that we bought within our price range and stayed in. My daughter and her husband, whose income is 1/3 of ours, bought a home that is almost double what ours is worth right now. There was a very nice home down the street that was large, nice, and had a beautiful pool for sale that I tried to talk them into. It was too old was their response. Instead they bought a top of the line home in a gated neighborhood that they can barely afford.
In my neighborhood, the trend a few years ago was to borrow against the bubble-inflated home values and do extensive renovations. Now the trend is to tear down the cheap older homes and build larger houses in their place. But the lots are tiny, and the new houses stretch from setback to setback, so the kids don’t have any yard to play in. It’s sad.