OP is calling out the base price increase, but if you do the math, the real culprit is what the article is, rightly, focusing most of its time on. Interest rates.
Interest rate increases are the main reason why mortgage payments have skyrocketed recently. The math doesn’t lie. Any loan calculator will show you that the 2019 to 2023 interest rate changes are like a damn sledgehammer.
That is correct, interest rates are high on purpose to slow inflation. Now I know I'll never sell my house because at 2.4% interest I'd be stupid to do that and then have a 7.9% interest rate on a new home.
Which obviously has knock on effects as people like me will never be able to buy a first home because others aren't selling theirs (understandably) due to the high interest rates…
I was never really ok with the idea that retirement was only for the well off, but now we're getting to "literally anything one considers part of a normal life is only for the wealthy now." Considering home ownership is pretty much a necessity for retirement as you can work on a budget, now both seem like mythical creatures one only encounters in fairy tales. :/
Hey, FWIW, there are even blockers to maintaining homeownership now. Property taxes in some locations keep skyrocketing, making the attempt of just sitting still in one's home become less and less attainable. I've seen those in retirement/fixed income having to sell their house and leave where they live due to the static cost of living climbing too high to be able to continue to afford. Every kind of home maintenance cost has exploded since 2020, further stretching the ability for one to sit still and live.
Just straight existing seems to be increasingly challenging. It's annoying and unacceptable.
When I was in my twenties I felt the same way. Now in my forties I have more than enough saved for retirement, I have a pension in place, and living debt free minus house and a car payment. Things will change as you age to a point where retirement is a possibility.
Things changed quite a lot in the last 20 years. You and I are fortunate in that regard. On top of (presumably) having other advantages including good paying jobs.
I bought my house in the Denver suburbs about 20 yrs ago on a mid-career IT salary and it was affordable (well within my means) at the time.
The house is now worth about 3X what I paid. I seriously doubt mid-level IT salaries have tripled. Hell, my own salary hasn't even tripled from raises in 20 years. I can't imagine how people can afford housing in major cities like this unless they're on the higher end of the middle class.
Not everyone gets a 401k. Not everyone can cut their budget any further and still save. If you can save, if you have a 401k, max it out. Max your Roth if you can. In 20 years you will have a lot more money. But if you are living hand to mouth the system we have basically says "fuck you".
The middle class has been squeezed ever tighter for some 40 or 50 years now. Wealth has been gushing from the bottom to the top since the 80s.
Gen X was in the same boat until 2010. As a generation we dealt with constant setbacks and a 20 year war. As GenX takes over things the barriers will crumble and Millennials will start becoming successful as well. Gen Z and Alpha might be screwed because of the population size of the Millennials, but the path won't be as difficult as it is right now.
The biggest barrier is wage stagnation so boosting wages across the board by 20% will help matters.
OP is calling out the base price increase, but if you do the math, the real culprit is what the article is, rightly, focusing most of its time on. Interest rates.
Interest rate increases are the main reason why mortgage payments have skyrocketed recently. The math doesn’t lie. Any loan calculator will show you that the 2019 to 2023 interest rate changes are like a damn sledgehammer.
That is correct, interest rates are high on purpose to slow inflation. Now I know I'll never sell my house because at 2.4% interest I'd be stupid to do that and then have a 7.9% interest rate on a new home.
Which obviously has knock on effects as people like me will never be able to buy a first home because others aren't selling theirs (understandably) due to the high interest rates…
I was never really ok with the idea that retirement was only for the well off, but now we're getting to "literally anything one considers part of a normal life is only for the wealthy now." Considering home ownership is pretty much a necessity for retirement as you can work on a budget, now both seem like mythical creatures one only encounters in fairy tales. :/
Hey, FWIW, there are even blockers to maintaining homeownership now. Property taxes in some locations keep skyrocketing, making the attempt of just sitting still in one's home become less and less attainable. I've seen those in retirement/fixed income having to sell their house and leave where they live due to the static cost of living climbing too high to be able to continue to afford. Every kind of home maintenance cost has exploded since 2020, further stretching the ability for one to sit still and live.
Just straight existing seems to be increasingly challenging. It's annoying and unacceptable.
When I was in my twenties I felt the same way. Now in my forties I have more than enough saved for retirement, I have a pension in place, and living debt free minus house and a car payment. Things will change as you age to a point where retirement is a possibility.
Things changed quite a lot in the last 20 years. You and I are fortunate in that regard. On top of (presumably) having other advantages including good paying jobs.
I bought my house in the Denver suburbs about 20 yrs ago on a mid-career IT salary and it was affordable (well within my means) at the time.
The house is now worth about 3X what I paid. I seriously doubt mid-level IT salaries have tripled. Hell, my own salary hasn't even tripled from raises in 20 years. I can't imagine how people can afford housing in major cities like this unless they're on the higher end of the middle class.
Not everyone gets a 401k. Not everyone can cut their budget any further and still save. If you can save, if you have a 401k, max it out. Max your Roth if you can. In 20 years you will have a lot more money. But if you are living hand to mouth the system we have basically says "fuck you".
The middle class has been squeezed ever tighter for some 40 or 50 years now. Wealth has been gushing from the bottom to the top since the 80s.
Gen X was in the same boat until 2010. As a generation we dealt with constant setbacks and a 20 year war. As GenX takes over things the barriers will crumble and Millennials will start becoming successful as well. Gen Z and Alpha might be screwed because of the population size of the Millennials, but the path won't be as difficult as it is right now.
The biggest barrier is wage stagnation so boosting wages across the board by 20% will help matters.
You have a lot more confidence in the Reagan generation than I do as an elder millennial.
Lucky you. It won't be that way for many (I'm only not saying most because I don't have a source to hand to back it up on my phone).