The majority of 18- to 29-year-olds in the US are now living with their parents • Hacker News Board

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#331

Post by ethbr0 » Wed, Sep 16, 2020, 5:09 PM UTC

mywittyname wrote: post #296

tidepod12 wrote: post #284

Earlier quoted context omitted.

>One is because homes today are substantially larger and have more amenities than they did in previous generations. I have noticed that most of my fellow millennials seem to have completely forgotten the concept of "starter home" and assume that as soon as you turn 25 you should be entitled to a 4 bedroom house with a pool, huge yard, wonderful neighborhood, three-car garage, etc. Among my friends that have bought ho…

> I have noticed that most millenials seem to have completely forgotten the concept of "starter home" and assume that as soon as you turn 25 you should be entitled to a 4 bedroom house with a pool, huge yard, wonderful neighborhood, three-car garage, etc. "Starter homes" for young people is the stuff that was built 30-40 years ago that hasn't been updated. So they are buying those mcmansions because that's what was b…

Single point of reference, but my 1985-built house was constructed at a much higher standard than my 2010-built house.

The properties of wood and physics have remained surprisingly constant over the decades.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#332

Post by lol768 » Wed, Sep 16, 2020, 5:09 PM UTC

_jxdz wrote: post #318

I earn more than my family or my peers earn, but living in London often feels like my money comes in and goes out again immediately. As a result, I currently live with my family in an extraordinarily nice house that I would never be able to afford myself. I pay them a nominal sum for rent; they refuse to take the market rate even though I am happy to pay it... I look at the rental cost of a standard 1 bedroom flat in…

> It would be cheaper to get a mortgage, but I fail the "affordability" tests

I naively thought that these affordability tests would involve looking at whether my take home income minus my monthly costs was higher than the monthly cost of the mortgage. That sounds like a reasonable definition of "affordable", right? We can account for increases in interest rates too.

In reality, the amount of ridiculous hoops that need to be jumped through to quality as being able to "afford" a mortgage is silly, and it never used to be like this. Current employment contract less than a year old? Denied, even if you've been at the same company longer than that. Contractor without 2 years of Ltd company history? Welp. Want to use help to buy? That'll limit your pool of potential lenders even further.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#333

Post by peter_l_downs » Wed, Sep 16, 2020, 5:10 PM UTC

wonderwonder wrote: post #11

Millennials face a very real risk of being a lost generation financially. They have endured 2 major, years long recessions, and now the Covid pandemic coupled with social isolation and massive unemployment that does not appear to have an end date in sight. Housing is more expensive for them than prior generations, wages are stagnant, school is expensive and social conflict is also currently on deck. WW2 was of course…

18-29 year olds are sort of between generations but largely fall into Gen Z; certainly they're the youngest end of Millenial, and can not really be said to have endured the 2008-2011 recession as they were not working at that time.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#334

Post by gpapilion » Wed, Sep 16, 2020, 5:10 PM UTC

Philip-J-Fry wrote: post #94

I'm my early 20s and in the UK. I earn more than my Dad who is in his 50s. He managed to get a house, have money left over for an expensive hobby, decent car, the odd holiday etc. I'm a 90th percentile earner. Will 95+ percentile earner in a few years time. Yet it feels like I am not as well off as I should be. I don't live in an expensive area either. Yet I need to save so much money to even have the opportunity to…

I’ve thought about this a lot. My parents had 2 TVs in a house of five(and one was junk). We had stick on vinyl floors, and a cheap white appliances. Counter tops were linoleum, and we had 1.5 baths. I cut the lawn, and we went shopping in stores. We took two vacations requiring planes for the first 13 years of my life. Most vacations were camping. We rarely went out to eat. We didn’t have computers. We had 1 corded phone in the house.

This is in stark contrast to my house. We have two iPhones and get new ones every 2-3 years. We have two iPads, 3 computers, and gadgets galore in a house of 4. My countertops are stone, my appliances are stainless. We go on vacations yearly that require planes and hotel, and used to eat out often. I have a house cleaner, and pay for an expensive gym.

I realize I may not have the house my parents have, but I have nicer things. I make more money but I spend it very differently then they did. There was basically nothing we bought that compares to an iPhone every 2-3 years. I know so many people who travel regularly, and don’t seem to realize this was rare 15 years ago. I really feel we spend our money differently.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#335

Post by nostrademons » Wed, Sep 16, 2020, 5:13 PM UTC

Retric wrote: post #311

nostrademons wrote: post #297

Earlier quoted context omitted.

> WW2 was of course a much more trying time but it was followed by massive economic growth for most sectors of the population, I don't see that happening after the pandemic, wealth is just being silo'd and prosperity limited. I could see it happening, but not in a good way. One (not all that unlikely) scenario is that the economic winners manage to place themselves out of harms way in the pandemic & social unrest tha…

That analysis completely fails after WWI. The actual cause of the post war boom was a massive increase in agricultural efficiency. This freed up a large chunk of household budgets to be spent of consumer goods which kicked off a long cycle of economic growth.

Timeline and geography doesn't work out for your hypothesis. The Green Revolution began in earnest in the late 50s; at that point, the post-war expansion in the U.S. was alread 10-15 years old and slowing down. It also started in developing nations like Mexico, India, Bangladesh, and the Philippines - there's perhaps some influence through international trade, but if that's the cause you'd expect Mexico and India to be the geopolitical superstars rather than the U.S.

The timeline does match up with the Marshall Plan and redevelopment of Japan. A much simpler explanation is that the U.S. was the only nation whose capital stock remained intact after WW2. This allowed us to produce high-value goods more efficiently than everywhere else, which allowed us to export more, which led to a strong currency and ample buying power on world markets. Post-war unionization also spread the fruits of this productivity to society as a whole, rather than concentrating it among capital owners.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#336

Post by lotsofpulp » Wed, Sep 16, 2020, 5:13 PM UTC

Philip-J-Fry wrote: post #254

throwawaygh wrote: post #203

Earlier quoted context omitted.

Comparing a salary with a pension to a salary without a pension is insanity. Wages are not stagnant. They've declined precipitously. take-home pay is stagnant and pensions are dead.

I'm confused. We both have pensions.

In the UK, they refer to defined contribution and defined benefit as pension.

In the US, pension is short for “defined benefit” pension, which is an annuity beginning at a specified retirement age. The liability for providing that benefit does not lie with the recipient of the defined benefit, but with the employer (or government).

A defined contribution pension is one where the recipient of the benefit owns and controls the assets that will be used to pay the retirement benefits, hence the recipient is liable for making sure to have sufficient savings and the right investments to be able to pay themselves in retirement.

In the US, social security is the defined benefit pension available to everyone provided by the federal government.

However, it is prudent to expect defined benefit pensions to decrease in value as the retirement ages are increased, and benefit amounts and future value of money are decreased due to slowing economic growth in most developed countries.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#337

Post by OJFord » Wed, Sep 16, 2020, 5:14 PM UTC

Shivetya wrote: post #326

tidepod12 wrote: post #284

Earlier quoted context omitted.

>One is because homes today are substantially larger and have more amenities than they did in previous generations. I have noticed that most of my fellow millennials seem to have completely forgotten the concept of "starter home" and assume that as soon as you turn 25 you should be entitled to a 4 bedroom house with a pool, huge yard, wonderful neighborhood, three-car garage, etc. Among my friends that have bought ho…

it isn't just homes. there is no starter car, no starter tv, no started anything. I regularly work with tech support persons who are spending more than I am on a wide range of goods and services. It is mind boggling to me. Yes some have trade offs but that seems to be either they are house poor or car poor but mostly the latter. What catches them as with those who do have the money is all those monthly bills can add…

I don't think anyone that says it intends it this way, but this is how I read 'generation rent'.

Not 'forced into renting instead of buying property' but 'subscription over ownership for everything'. No money left, lots of stuff, as little of it as possible actually bought and owned. Lease car, rented flat, rented furniture, takeaways and meal box kits, craft beer / organic veg boxes, etc.

In many cases it's a reversion rather than a new idea, and fine, it's not wrong, just different. Very different though, and largely not for me (though I fall in the generation described).

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#338

Post by texuf » Wed, Sep 16, 2020, 5:14 PM UTC

mywittyname wrote: post #288

dcolkitt wrote: post #246

> Housing is more expensive for them than prior generations I harp on this constantly. But housing is not more expensive in the majority of American metros. Adjusted for inflation the median cost per square foot of new housing is almost exactly the same as it was in 1990. (This doesn't even take into account that mortgage rates are drastically lower since then.) We get skewed on this for two reasons. One is because h…

> But in places like Tampa, Omaha, Cincinnati, and Phoenix the cost of housing (per square foot) has barely gone up at all. Maybe if you stop looking at like 2018. But my on-the-ground analysis living on one of these cities is cost of housing has fucking exploooded. I built a house just two years ago, which I thought was incredibly expensive at 2 times the median home price in the area. I had it in the back of my hea…

With the extremely low interest rates, I wonder if the monthly payments are about the same.

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#339

Post by ethbr0 » Wed, Sep 16, 2020, 5:14 PM UTC

Shalle135 wrote: post #329

tidepod12 wrote: post #284

Earlier quoted context omitted.

>One is because homes today are substantially larger and have more amenities than they did in previous generations. I have noticed that most of my fellow millennials seem to have completely forgotten the concept of "starter home" and assume that as soon as you turn 25 you should be entitled to a 4 bedroom house with a pool, huge yard, wonderful neighborhood, three-car garage, etc. Among my friends that have bought ho…

Fact is though, it doesn’t matter much where in the world you’re looking to buy. If it’s a capital you’re expected to pay close to $1m or more for a house, even in places like Beirut where the houses don’t have central water, electricity/internet infrastructure is extremely poor. Prices are the same. This in a moment in time when the majority of people barely can afford food due to the pandemic and financial meltdown…

When the world is awash in debt, pricing turns into a game of future-mortgaging chicken.

Who's willing to promise more of their future to buy an asset?

Re: The majority of 18- to 29-year-olds in the US are now living with their parents

#340

Post by dcdevthrowaway » Wed, Sep 16, 2020, 5:16 PM UTC

tidepod12 wrote: post #284

dcolkitt wrote: post #246

> Housing is more expensive for them than prior generations I harp on this constantly. But housing is not more expensive in the majority of American metros. Adjusted for inflation the median cost per square foot of new housing is almost exactly the same as it was in 1990. (This doesn't even take into account that mortgage rates are drastically lower since then.) We get skewed on this for two reasons. One is because h…

>One is because homes today are substantially larger and have more amenities than they did in previous generations. I have noticed that most of my fellow millennials seem to have completely forgotten the concept of "starter home" and assume that as soon as you turn 25 you should be entitled to a 4 bedroom house with a pool, huge yard, wonderful neighborhood, three-car garage, etc. Among my friends that have bought ho…

> Among my friends that have bought houses, many of them have gone into significant debt just to buy a 3-4 bedroom house, even though they have no kids and only use one of the bedrooms, because they think that at some point in their life they will put them to use.

Are you sure your friends aren't just being rational? I thought about the rent vs buy thing pretty constantly in my 20s and always came down on the rent side. Not because renting Dwelling A would be cheaper than buying Dwelling A, but because I was happy living in Dwelling A (a nice-ish 1-bedroom apartment) but if I were to commit to ownership I'd want Dwelling B (at least 3 bedrooms). Life can change fast - you're not sure which fling will turn into a spouse or when a little one will come along or when you'll really need a home office. Selling a one-bedroom condo is obviously doable, but transaction costs are fairly insane on real estate, and it seems like low-end places (like 1-bed condos) haven't historically experienced the same appreciation as standard houses.

It sounds like your friends could get by with a Smart car but bought a Toyota RAV4 instead. And when they decide to trade up to a Tesla in a few years, they might find that the RAV4 retained value better than the Smart car, because that's what "everyone" wants!