Nothing wrong with that. We rented into our 30s while all the people we knew already had houses. We make a lot more money now, but we don’t live that way. Our house is modest, and we only have one car payment (almost paid off). Money is very elusive. By the time you have it, the kids are grown and you don’t need it.
Nothing wrong with renting and silly your parents are embarrassed. I have to say I feel bad for my friend that lives in the City and always rented as she missed out on the money they would have made if they had bought something back in the day.
If I had my way, I’d never own another house. I’m tired of homeownersship and dealing with everything!
But, OTOH, I fully understand being wary of renters. Our city is full of renters. Our immediate neighbors didn’t used to be, but several have turned into rentals in the last few years. We lived next to one where it was quite literally like the movie “Neighbors.” The single family home was turned into the college football team clubhouse, the next year it was a frat house. Fortunately, that guy sold and the next owner rented it to a nice family for awhile. We liked them! But then it sold. New person wants to make it an airbnb… We will see. We are being optimistic for the time being because they’ve pumped a TON of $$$ into the house.
But then the house across the street turned into a college rental after the elderly couple had to sell to go into AL. The current group is normally OK. the previous couple of years, they would have parties that wouldn’t bother us so much because it’s a wide street and our house sits back. But, they would block our driveway a lot and H would have to beat on the door…
Which leads me to my “get it off your chest” thread rant… Left to leave to head to work, and someone was blocking my driveway and I was stuck. Beat on the rental door’s house. Nobody came to either door (it’s a duplex). Tried a few others - nothing. Went to a rental a couple of doors down. That guy answered and said it wasn’t theirs… Over an hour later, the police gets the tow truck to show. As we were talking, two girls came out of the rental where the guy just told me it wasn’t theirs!!! “Oh I’m so sorry!” Bleepity, bleep, bleep. They got a parking ticket. Better than nothing, but argh!
So yes, I get the wariness of renters! But, not all renters are bad. If you follow the law, you’re good in my book.
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Both of my kids are millenials. Neither is broke. ShawSon has a good income and his wife also has a good one. She has stock from the big tech companies where she has worked, which have appreciated a fair bit over time. What swamps things for them is the value on paper of his stock in a venture-backed company he co-founded (although, as ShawD says, he works 18 hours a day). ShawD has a good job and a pretty good salary… Unless she finds a partner like ShawSon, she will never be wealthy but is already doing well and will do somewhat better over time.
I think the thing that makes them feel poorer is the crazy cost of real estate in SF and Boston.
Both are contemplating purchasing houses, though I think the time is not ripe. We have not yet had the housing correction that feels reasonably likely.
ShawSon has never been interesting in things. Very few possessions. ShawD liked things, but most of her things burnt in the moving truck taking her from SF to Boston.
The neighborhood next to my rental is literally full of homeowners who are exactly like what you describe. Add in more autonomy with home improvement causing structural damage to the home next door and there you go. That plus the dynamic surrounding homeowners who have virtually all of their net worths tied up in that one property so they won’t sell to people who don’t offer more than 200k over asking combined with rent control laws is exactly what is keeping us out of the housing market where we are living now. Realtors and single family home developers in our area have started marketing to multigenerational buyers because that’s the income arrangement that a family needs to pay the prices that sellers demand. If the sellers can’t get those prices, then they rent out the homes.
We are in a rent-controlled property like the PP above and that keeps us out of this rat race for now.
That is what in our case makes us the picture of the myth of the broke millennial. We aren’t broke. We’re just living below our means and are better diversified.
I’m not saying that that’s better, either. It’s all a question of what comfort level you have with how you allocate your income.
In our row of 6 expensive townhomes 2 are occupied by renters. The millennial renters two doors down with a small dog could not be nicer and are very quiet. Immediate next door neighbor is a nurse and is closer to our age and has also been a wonderful neighbor. I know that in many neighborhoods renters can be a real pain, but since our places probably rent for $3.5K to $4.0K per month I guess we are lucky to get people who are respectful.
I’m curious why mid-to-late '90’s was a generationally great time to buy? That’s when I was buying and selling several times (due to work relocations) and it didn’t feel great at the time. In 1996 the interest rate for our first mortgage was 8.5%, higher than it peeked recently. And pricing and competition for housing was out of control (at least where we were). In 1998 we had to pay 50% more than the previous owners had 4 years before. And the process worked like this (like clockwork): The listing would come out Tuesday. They would do select brokered tours during the week and an open house Sunday. The open house would attract hundreds of visitors in approximately 4 hours (you would often need to park a couple blocks away and walk from there). All tours had a seller-funded inspection report available listing all the problems with the house. On Mondays the seller brokers would host “bidding parties” and typically a home would get at least several up to 6+ bidders, usually going over asking price, and all bidders had to accept the house “as-is” (no negotiating for credit or repairs) and be pre-approved for the loan.
It may have been different in various places but we bought a house in 1996 and sold it for twice as much in 2002. Many people we know in our age group in Silicon Valley who bought at the start of the Internet bubble (ie mid 1990s) did as well or better than that.
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Yes definitely different in places. We bought in 1996 and sold at the height of the housing boom in 2006. The value only increased 35% in 10 years, and that was less than the value of the improvements we put into it.
And our experience was considered to be good for our area at the time
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SV was a very unique housing market. And what you can later sell a home for is only a piece of the puzzle. My point is interest rates were generally much higher and it was a sellers market. If you lived in the right market and could clear those hurdles to buy in the first place and later sell at the right time, you would make a large return. I think the perception now is young people not being able to buy in the first place.
Probably more like the early-to-mid 1990s in some areas.
You mean the older half of each cohort who had the money and/or income to buy. Those generationally great buying opportunities were great because they occurred during economic downturns that meant that many would-be house buyers did not have the money or income, meaning less competition for buyers who did have the money and/or income.
As a result, within each cohort, the economic downturn and associated house price dip probably increased wealth inequality.
We sold a house in '98 and made very little, especially considering we had added a patio, landscaped a previously unusable lot, finished the basement (added a family room, another bedroom and full bath, etc.
The house we bought in '98 was sold a year ago at 3X the price we paid. We had done some improvements/updates but we still made a large profit.
There’s one family in our neighborhood that we wish were renters. That would give the rest of us hope that they might move someday.
Here is a much better study of home ownership among Millennials. Also, making this claim, while only looking at income, while ignoring debt and equity does not.
Also, home ownership is NOT the same, and I’m not sure why they are making that claim.
This report was cited in a Forbes article.
That is actually where the Millenials are, because that is where the jobs are. It doesn’t help if there are dirt cheap homes in a town which had an economy based on a factory which closed. It doesn’t help if there are thousands of affordable homes in a city in which unemployment is 27%. Millions of cheap homes in areas without economic opportunities are not actually “available” in any real sense.
Our local millennials ARE buying houses… just not in the most populous county.
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More anecdotal evidence here. My millennial daughter is doing very well, her current salary is about that of my husbands when he retired in 2019. She is renting by choice, she has plenty of money to put down on a home. I have a friend whose son is an artist, dropped out of college, it was not for him. He recently sold his house in Dallas and made a nice profit. Now he chooses to live in a large apartment in Dallas for a very reasonable rent. Last example, I have a millennial friend, married, baby on the way. They are both in their own businesses (she is a graphic designer and he owns a fitness/yoga studio). They were able to purchase a house a few years ago (in the expensive NJ market). So all are doing very well, although all are doing it in different ways.
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Gen X’er here. I’ve had to commute a significant distance my entire career, and move for the work. That’s nothing new. The idea of being able to actually live in the city I work in and also save or afford a good lifestyle seems alien. My shortest commute since graduating undergrad was 45min-1hr (depending on traffic) each way – I even had to do this commute during full time grad school and part-time work too. My current commute is 1hr, 45min - 2hr each way (assuming no problems with the trains, and there are frequent problems), though I am grateful for a 3-day in-office hybrid schedule post-Covid – for years it was leave at 6:30am and get home at 9pm, 5 days a week.
My oldest child, now almost 3 years post college is making ~4x what I did at his age. That meaningfully exceeds overall inflation in that period. I just looked up my first home, which I bought 1.5 years later than my son’s equivalent age, and it sold less than 2 years ago for 3x what I paid. So, proportionately, he’s in a better position to buy it than I was at the time.
He chooses to live in a rental with roommates in a urban area, because he’s chosen to prioritize different things and trad offs than I did, which is awesome. He also has the luxury of working remotely on average 4 of 5 days a week and even being able to do work days while traveling, something I couldn’t have even imagined at his age. He’s said if he wanted to move to a different part of the country and keep his job fully remote he could. By comparison, I had to uproot my whole life 3 times to move to move markets to where the best opportunities were.
To be clear, not complaining. It all worked out well and I made choices. And I am legitimately pleased for the greater flexibility many now have in the workplace. But I’m not convinced that life is so much harder now.
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The educated Millienials that I know are doing quite well for themselves in most aspects, but I have also seen some struggles for that group and some of the lower paid high school graduate Millennials that I personally know. My wife and I are younger Gen Xer’s and we have definitely had some advantages over most Millennials (especially those born after 1986).
Our biggest advantage was the fact that my wife and I were able to buy a home in 2005 with no money down (Credit score was ~710) and actually received ~$1500 at closing. A few years later and we were able to refinance to a much lower interest rate over 15 years and now only have 5 years left before paying off a home that has more than doubled in value. My wife and I did not have 5% of the original value of our house in savings until we were about 40 years old. That would have been over a decade “lost” renting and my kids not being in our great school district over not having a down payment. I have definitely talked to Millennials who wonder if they will ever be homeowners and I am just thankful that my family basically got “paid” to move into our home before the easy lending era ended with the start of the Great Recession.
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Except for the booming states like Idaho, Utah, Texas etc which have ample opportunities for millennials and Gen Z (and are growing rapidly as a result), but are just “flyover country” for liberal journalists writing articles in NYC that shape the narrative.
One of the biggest differences in the US compared to many other countries (eg UK and France) is that the US has many self-sustaining regional centers instead of one dominant (capital) city.
Some of the most interesting questions in urban planning today are about how to establish second tier cities as hubs that attract jobs and young people, for example in the TN/GA/NC/SC region. But in some states like CA many NIMBYs who have benefited from past growth, instead want to make further economic development as difficult as possible.
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Having grown up in Illinois, lived in DC area for 38 year and currently live in Twin Cities,I agree that some people who have lived their entire lives on the coasts seem to think there is nothing going on in “flyover” country. And it is not limited to any political ideology.
In the DC area I I had a boss years ago who didn’t understand that Chicago had great museums,theater,food, etc., colleagues who assumed I grew up on a farm, people who were familiar with “top schools” but were unfamiliar with U Chicago or Northwestern, etc. I can give you many examples. Suffice to say the people were of varying political stripes. It was just an east cost thing. People don’t “get” that there are great places for millennials such as Madison, Ann Arbor, Twin Cities, etc.
Oh, and NIMBY’s are plentiful in Northern Virginia 
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