I know why Millenials can't afford houses and pay off their student loans..

[Anonymous]

Anonymous wrote:

Anonymous wrote:Took a field trip to Union Market this weekend. Filled with young people looking very spiffy, drinking $5 coffees and buying things like $30 candles and locally sourced food that is 2x the price of Safeway. There was a stall there selling $200+ Japanese knives. All this 'everyday luxury' is killing you guys.

Let's bring this lovely thread back to the original post so we can all identify what to invest in and what not to invest in. Everyday luxury companies will be good investments. Mediocre chain grocery stores will likely go bust in the next few years. Housing is a bad bet.

Have you been in a Safeway or Giant lately? I think they already have.

[Anonymous]

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Anonymous wrote:The more you talk about opportunity cost, the more I think you live your life leveraged to the teeth.

That's fine when all is well -- you're employed, you're healthy, the market is going up.

What happens when any of those circumstances changes?

Mortgage = leveraged to the teeth. What's your point again? The point of renting is to allow flexibility in your overhead so that when circumstances change, you're not dealing with foreclosure. Only a dumb Millennial basher would completely mix up the concepts and celebrate the idea of taking on an enormous amount of debt.

You've made your point PP (this is NP from above btw).

Not everyone gets a mortgage that leverages themselves to the teeth. My mortgage payments are several hundred LESS than what I was paying in rent. Now I'm getting closer to being able to max out my TSP! It's saving me money, even as I increase my savings and my ability to invest.

Clearly what you are doing is working for you - that's what it needs to do. What I'm doing is working for ME (the person it needs to work for!), and PP with a good job and poor health - sounds like he's very happy with where (s)he is in life as well. Which is excellent.

Now stop telling them they have no idea what they're doing, because you're acting as though you are the ONE person who knows anything about finances. You're not. There are many theories on how to invest, and each person needs to do it in a way that works for them and their willingness to take risks, and there is more than one way to do it "right".

In case you haven't noticed, this is an entire thread making fun of Millennials for not buying houses. Who's the one pretending like there's only one way to spend money? The sweet justice in all of this is that all of you who think your houses are great investments are the ones who will be underwater when Millennials don't buy into the same American housing scam. Your house is only worth what Millennials are willing to pay.

You are sure passionate about this! Good luck finding a good deal on rent if millennials can't afford and don't want to buy.

Huh? Do you not understand how demographics and economics works? Millennials are staying longer in dense urban living situations and having children later or not at all, which means that the current crop of housing will be in oversupply as kids leave the nest and people need to downsize. People like you and the other poster will be looking to moving to an area with a lower COL, but you are convinced that you have made a great investment and will not be willing to sell at a lower ROI than you imagined. You will then rent out your houses hoping to ride out a short-term dent in the housing market, but again there will be oversupply as there will not be many Millennials looking to live in such big houses, so rental prices will be cheap.

Seriously you sound nutso. It's completely fine that you think renting is the way to go and have no interest in homeownership. You do you. It would probably be a better use of your time to focus on your investments and managing them.

It's amazing how the Millennial bashers get all excited about Millennials not being able to pay off their student loans or afford houses, but when presented with a real argument about how these trends will affect the value of THEIR HOUSE, suddenly it's "nutso" and no one wants to discuss anymore. Lol.

I bought my Capitol Hill rowhouse in 1995 for $141K. It's 2 blocks from Eastern market, and I paid it off 5 years ago. (Been renting both units out for 15 years -- so technically my tenants paid it off). I plan to keep it as an income-generating asset till I die, but even if I decide to sell at some point, I think I'll be fine.

But thanks for your concern. Go enjoy your market returns. Nothing could possibly go wrong there, particularly with OPEC cutting off oil production, the health care industry in free fall, and Trump slapping 15% import taxes on pretty much everything everyone buys.

Yes, nothing can possibly go wrong with your investment that is not only at the mercy of the global economy and the Trump economy, but literally the economy of a single block in a single neighborhood. And I mean, none of your tenants will be affected by things like market returns, OPEC, healthcare, or import taxes, right?

You're right. We are all screwed. Might as well lever up and buy that beautiful home. See how we've come full circle?

I don't see your point at all. In fact, you seem willfully ignorant. Millennials today are smart not to buy into housing because housing in this area is seriously overpriced. There is no reason that a 2BR house should require a $100K downpayment!! That downpayment is much better used diversifying into a wide variety of investments that can be hedged against shifts in the economy rather than poured into a SINGLE investment at the mercy of both geographic AND market forces.

Why? Because you say so and put two exclamation points after it? I think you are a home ownership denier.

[Anonymous]

Anonymous wrote:

Anonymous wrote:man DCUM when special snowflakes grow up

all of you have such fragile egos cant take any criticsim at all

I would hate to be your coworker damns lolz

Yes, the current DCUM generation is so thoughtful and smart. Constant wars over breastfeeding, feuding with MILs, inability to pay off credit card debt, SAHM vs. WOH wars. Lol.

People were arguing over this crap on AOL forums 20 years ago...

[Anonymous]

Anonymous wrote:I skipped from about page 6 to page 20, but in what I read nowhere did I see this stat cited: Since 1985, the overall consumer price index has risen 115% while the college education inflation rate has risen nearly 500%. Meanwhile: The wages of middle-wage workers were totally flat or in decline over the 1980s, 1990s and 2000s, except for the late 1990s. The wages of low-wage workers fared even worse, falling 5 percent from 1979 to 2013.

Saying "Starbucks is $5/cup!" or "responsible ppl pay off their loans, tsk tsk" is not really useful in a vacuum. Things have changed in ways that can't be blamed exclusively on supposed character defects of younger people who, as usual, have somewhat different values and cultures than older people.

Enjoy your social security. We won't.

+1.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I skipped from about page 6 to page 20, but in what I read nowhere did I see this stat cited: Since 1985, the overall consumer price index has risen 115% while the college education inflation rate has risen nearly 500%. Meanwhile: The wages of middle-wage workers were totally flat or in decline over the 1980s, 1990s and 2000s, except for the late 1990s. The wages of low-wage workers fared even worse, falling 5 percent from 1979 to 2013.

Saying "Starbucks is $5/cup!" or "responsible ppl pay off their loans, tsk tsk" is not really useful in a vacuum. Things have changed in ways that can't be blamed exclusively on supposed character defects of younger people who, as usual, have somewhat different values and cultures than older people.

Enjoy your social security. We won't.

+1.

[phone]

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:man DCUM when special snowflakes grow up

all of you have such fragile egos cant take any criticsim at all

I would hate to be your coworker damns lolz

Yes, the current DCUM generation is so thoughtful and smart. Constant wars over breastfeeding, feuding with MILs, inability to pay off credit card debt, SAHM vs. WOH wars. Lol.

People were arguing over this crap on AOL forums 20 years ago...

Oh my! And I thought Millennials were the WORST generation ever.

[Anonymous]

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Anonymous wrote:I just read a post where some one claimed 990% of the value on their property is the lot! Either they have acreage or a real shitshack. I'm imagining an 800 sq ft 2bd 1 bth hoarder house in wesley heights.

I'm imagining a modest house in Franklin Park, McLean.

I meant 90%. -- typo. It is an 1800 sq foot house in in a good neighborhood in Fairfax county.

For FX to have it at 90/10 it is either on acreage or a complete dump-teardown-shed. There's a shitshack in mclean that is about 60/40. Fairfax County is even writing in comps as handyman specials if a property closes lower than building + lot assessed value. Or recording it as non-representative sale based on the County assessment area comps.

[Anonymous]

Anonymous wrote:Took a field trip to Union Market this weekend. Filled with young people looking very spiffy, drinking $5 coffees and buying things like $30 candles and locally sourced food that is 2x the price of Safeway. There was a stall there selling $200+ Japanese knives. All this 'everyday luxury' is killing you guys.

Millennial with HHI of over $500k/yr and a vacation house who frequents Union Market with my biglaw friends. Lots of rich millennials in DC.

[Anonymous]

Property currently marketed as plat-lot in Franklin Park has the building at 22% of assessed total. Teardown in Ballantrae? On 2 acres? 90% possible.

[Anonymous]

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Anonymous wrote:When you look at buying houses, it is best to think of it from a cash-flow perspective.

Lets say, after taxes, the house is neutral cost compared with an apartment (I do not know if this is the case today). In 30 years, no matter what happens to the price, you have paid off the mortgage. You have value.

Now, while the price of the rental usually goes up, the mortgage is constant. So, as things inflate, the percentage of my income (which inflates) going to housing drops. Today, it is 9% of my income, down from 29%....

So dumb. Do you think people who don't buy houses just let their down payment sit and gather 0% interest? Your mortgage might be constant but the tradeoff is that you are drowning in opportunity costs. There is nothing stupider than investing 30%+ of your net worth in a single asset. Most people are better off renting and investing the down payment in REITs to hedge for real estate appreciation.

I put 20% down. 50K. Lets say I put in in the S & P 500 based fund. O n the day I pulled the money out, the fund, S & P 600 was about 1335 on the day bought the house. Today, it is 2270. So it would be 85000. By comparison, in those intervening years, I have paid the mortgage down 75K. If the house value had remained constant, the 50K would now be 125K in equity instead of 86K if it was invested in SP500. Note that my cash flow was actually better than if I was in an apartment on day 1.

Now, if I rented, my rent would be about 3K today, doubling since I bought my house. The cumulative difference would be about 240K extra for rent vs mortgage (mortgage after taxes). Granted, I have had to do some maintenance. That is probably on the order of 3K per year, or 54K.

Factoring it all in, I have paid out 190K less owning the home. If my house has been constant value, I am 190K+125K-86K = 229K ahead owning vs. renting over 18 years. That is my daughters college for 4 years.

The kicker is my house, which I paid 275 for is now worth about 700K. So, that decision to buy has netted me an extra 229:+425K, or 654,000. That is real money.

So, making the decision to buy put

It's not real money until you sell out. Good luck getting someone to hold that bag.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Took a field trip to Union Market this weekend. Filled with young people looking very spiffy, drinking $5 coffees and buying things like $30 candles and locally sourced food that is 2x the price of Safeway. There was a stall there selling $200+ Japanese knives. All this 'everyday luxury' is killing you guys.

Let's bring this lovely thread back to the original post so we can all identify what to invest in and what not to invest in. Everyday luxury companies will be good investments. Mediocre chain grocery stores will likely go bust in the next few years. Housing is a bad bet.

Have you been in a Safeway or Giant lately? I think they already have.

My millennial husband refuses to shop at these stores. Our grocery bill is $600/month because only TJ's, Wegman's or maybe Harris Teeter for him. Whole Foods is financially beyond our reach. He would rather starve than eat Safeway/Giant produce. Help.

[Anonymous]

Anonymous wrote:I tend to agree with much of this. The millennials I know almost all live with their parents because (supposedly) they're saving up money, but they lack for nothing (new iPhones, clothes, cars) and take ski trips to Aspen. I have a hard time imagining that their bank accounts are flush.

One is actively looking for an apartment -- with his mom, of course -- and has turned down every option for some reason: too small, too dark, the kitchen isn't updated, too loud, too close to public housing, too far from mommie and daddy. He wants to get a roommate, but he refuses to share a bathroom and his mother agrees that sharing a bathroom with "a stranger" is unacceptable for her snowflake.

Can't exactly weep for them.

A number of the bolded are legitimate concerns. If he's staying with his parents and saving money, and has his parents' support in looking for an apartment, where is the negative? He's a lucky guy, certainly, but there's nothing wrong with what he's doing (I must admit I'm under the impression that he holds a job and is choosing to stay with his parents to save his money and find a first apartment he really likes).

[Anonymous]

Back to the beginning.

I am a milennial.

I own a house.

I can pay off student loans. It will take me 6 or more years. But I can.

Op's assumptions about milennials are really off.

[Anonymous]

My question is if millennials are saving a lot of money and investing it given they aren't buying homes. If they are, they will be in good shape. But if they are spending all of their money instead of buying a home then they won't have any investments and they won't own a home.

[Anonymous]

Just to interject--DH and I (millennials, 28 years olds) don't own a house partly because we are in a phase of our careers where our current jobs are seen as a stepping stone, and it's likely that we may need to relocate before we would build any equity. Additionally, it has become common for some sectors to have more job hopping than in the past. I have a friend who bought a house and is a little frustrated because she and her DH are in one of those sectors, and the location of her house locks her in commute-wise in terms of what jobs she can reasonably consider. Before they would have just moved!

Once we have school aged kids, I'm sure the calculus becomes different. It's no big deal for DH and me to move when a new job opportunity comes around (whether it is locally to make a commute work or to a new metro area). When you have kids, having some consistency in their schools/home life makes more sense than moving apartments every couple years. But we're not there yet