Monday, March 31, 2014

On why Millennials don't buy homes

I posted the following in the comments section under a news article about young people renting instead of buying on wthr.com

http://www.wthr.com/story/25118656/2014/03/31/young-people-still-renting-instead-of-buying


I bought my first house this past year (right after my 27th birthday.  After college I've tried working out of state, working 3 part time jobs after a stint of unemployment (while living at the parents house), renting an apartment and renting a house.  I still work a part time job in addition to my full time "career" now just to help make sure that the bills can be paid.
I find two reasons why Millennials are living at their parents house and not buying their own.  The first is that my generation has decidedly less grit than previous generations.  We take the easiest path regardless of whether it's the best path.  Why buy when you could rent and not have to worry about maintenance or keeping savings to replace things?  Why rent when you could stay for free/cheap at a place that's already comfortable, familiar, and gets you free food/laundry services?  The second is that we actually do make less money and have more expenses.  I was talking to my grandfather (83 this year) and he remarked that when he bought his first house (still lives there by the way) that one full paycheck was within a dollar or two of covering the mortgage.  He thought that his mortgage was high and that most peoples weren't that high.  We both own 3 bedroom brick ranches with full basements.  We have comparable jobs as electricians too.  Wages just don't go as far anymore.  Not to mention I have student loans on top of all my other payments (which most Millennials do, because we were told that College was the promised land).  If I didn't work a second job I wouldn't be able to afford food.  My paycheck just doesn't go as far, regardless of how tightly I keep my budget.
I have neither wife or kids nor any of the traditional reasons to buy a house but I did for two reasons.  First, I knew that housing prices and mortgage rates were about as low as I'm going to see them and if I wanted to one day own a home I should do it now, regardless of my "comfort" with the risk or how much work I knew it was going to be maintaining a home.  Second, it was time for me to grow up and act like a man and carry my share of the burden in the community and in my church.  The house isn't exactly how I do this but it is a sign that I've chosen to be a responsible adult and not a kid anymore.
The economic situation will continue to get better and, though it's more painful, it's healthier if it continues to heal slowly (more stable that way).  Hopefully the struggles my generation is facing now will help us to build the grit necessary to be strong later in life.  Other than that I don't know how we fix the problem for the next generation

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