Posted on 10/16/2021 6:10:13 AM PDT by where's_the_Outrage?
Boomers and millennials are competing for houses, per a new Zillow report. Boomers are winning.
Boomers have more cash to win bidding wars as they take advantage of an appreciating market.
Buying a home has been hard enough for millennials, who are struggling with skyhigh prices and a lack of starter homes.
Baby boomers and millennials are in a housing war.
It's boomers who are winning, according to a Zillow report released this week. It found that so many boomers are active in the housing market that it's become more difficult for millennials to buy a home.
As seen in the chart below, Americans 60 years old and older have been more active in the housing market in the past decade than people in the same age group 10 years earlier. The share of homebuyers in this cohort grew by 47% from 2009 to 2019. Meanwhile, the share of younger buyers ages 18 to 39 in the past decade has shrunk by 13% in the same time frame.
(Excerpt) Read more at msn.com ...
I’m. Gen Xer. We definitely did not embrace mass immigration let alone mass illegal immigration.
We downsized to a smaller home, but with price increases it now exceeds the home that is 30% larger across the valley. Location, I suppose. Insanity, I’m certain.
Lol, I was wondering when that was coming after I hit post... :)
People are living longer. 60 years ago the expected lifespan for a guy was around 63. Now it is 81 and extending.
“ Upstate woods, an existing home of 2,000 Sq ft on a postage stamp size lawn can run up to 10 grand in prop taxes annually.”
Your worse off then my friends in Illinois. I’m always kidding them that they don’t own that house they just rent it from the State.
I’m not a leftist millenial and I cringe when I see the MSM put out these kinds of divisive articles, but there are some advantages you had in your scenario that today’s buyers do not have.
1) Going by records in 1980, median home price was $55k, median household income was $21k. In 2021, median home price is $360k, whereas median household income is $69k. Thus, a household in 1980 only needed to save half its annual income to put down 20% on a home at the time. Today, the typical household will need to save at least 1x its annual income to make a 20% down payment on a house.
2) Yes, I know interest rates were 18% on a 30-year mortgage in 1980, but did you not have the opportunity to refinance over the coming years? By 1986, the interest rate on a 30-year mortgage had reached 10% - a near 50% drop from the 1980 peak. Also, wasn’t mortgage interest tax-deductible (as it is today)? If a larger proportion of your mortgage payment consisted of interest payments, could you not deduct a larger percentage of your income then than you could in a scenario in which interest payments constitute very little of the total mortgage payment?
As low as rates are today, they literally have nowhere to go but up. Someone buying today likely won’t have the opportunity to refinance at a rate lower than we have today. We’re already starting to see rates creeping up to over 3%
3) Property taxes - we know fedgov always ties property taxes to the assessed value of a home, so wouldn’t a scenario in which home values rise much faster than the core inflation rate (which they certainly have since 1980) mean that property taxes also rise proportionally? If rates rise dramatically and put a damper on housing prices, worst case scenario would be your property taxes remain stagnant.
4) Were you buying into an extremely over-heated market in which housing supply, especially at the entry-level point, was at its lowest level in many decades? A market in which outbidding by 10%+ is very much necessary, along with waiving any housing inspection? Keep in mind that if the appraisal on a home comes back dramatically lower than the price which a 2021 buyer will offer (which is near guaranteed the case in this market), the buyer will have to cough up additional funds to cover the difference in order to qualify for a mortgage.
I’m most definitely not saying a 1980 buyer had a picnic; there were some key disadvantages that a 1980 buyer had that today’s buyers do not have. The younger person you specify below should be far more outraged over the value of today’s houses instead of over the interest rate.
A normal, balanced and rational market would look more like 1992-1996.
Boomers moving South or going Rural?
God bless you... wait - how can they call you a Greedy Capitalist Pig now tho?! 😉
This is the oligarchs trying to distract you from the fact that three multi trillion dollar oligarch hedge funds are buying all the available real estate coast to coast. Too bad most will never connect the dots.
Not defending the attitude that some millenials have, but we have a HUGE shortage or starter homes available on the market today:
“This is the oligarchs trying to distract you from the fact that three multi trillion dollar oligarch hedge funds are buying all the available real estate coast to coast.”
B.S. Don’t lie.
they may not have supported that, but they had no problem for decades voting in politicians, Democrats and Republicans, who did.
Boomer reality:
Daughter whining because can’t live and pay off student loans.
Me, pays off $57k in student loans she ran up without telling me.
I drive a 12 year old truck that I paid cash for.
Daughter drives a 2 year old Mustang with a fat payment.
Boomers are downsizing and they are bringing cash.
It’s always been that way.
What’s different is there are a lot of boomers.
First time buyers and older folks downsizing are shopping for the same properties.
Boomers are in their late 50s to 70s - wouldn’t they already have their houses? If they are buying, they’d just be swapping their old house for a new, probably smaller one, or for a condo.
We moved to a starter house in the next county 10 yrs ago, 71 yr old geezers don’t need on a 2 story roof hanging his Ham Antenna or fixing a few shingles. Fell twice, van was robbed, man walking dog in the early morning 1 block over murdered. I’d had enough of Memphis, double taxation, wheel tax. Everything they annexed went to pot. Drugs, gangs, rundown neighborhoods. We moved to the next Conservative county. 40 yrs of accumulated 4 families junk to be disposed of. The excess furniture went to Alpha Omega House for Veterans. We didn’t move far enough to suit me, but we needed the medical from Memphis. Our new little town has a pop of 7K. All insurances were lower. Taxes lower. Paid it off in 6 yrs on a VA 3.5% loan.
I also focus more on quality. Where I once had six or seven coolers of various sizes in the garage, I now have a single Yeti cooler. Instead of drawers full of tools, I invested in a single toolbox that has high end versions of any tool I might need around the house. Any item of clothing I haven't worn in over a year gets tossed. In the kitchen, nothing is left on counters. Every gadget, pot or pan gets cleaned and put away after each use.
It's fun to de-cumulate in this way, especially when you are able to focus on quality over quantity.
In my area, more and more single-family hopes are being used as rooming houses. You can tell by all the cars - sometimes even RVs and trailers - parked in front of them, sometimes on what used to be the front lawn. Less than a block from me, there’s a house - probably just a three-bedroom house - with seven cars parked there. Another house has a trailer and three cars in the driveway, and an RV and van on what used to be the front lawn. Also a motorcycle.
Yes they should have their houses, and realize they have lots of value and planned well for retirement, time to get that lakefront house they always wanted.
And spend the kid’s inheritance.
Daughter drives a 2 year old Mustang with a fat payment.
****************
Mustang Sally..... Times have changed since I was a kid and
in College. I expect many parents are in the same boat.
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