The 'old American Dream died,' Realtor details salary needed to buy a home, afford a middle class life in 2024

In the late 70s around 23% of US corporate revenues went to pay salaries. By 2012 that had fallen to 7% - in other words, just before neoliberalism really took off almost 1/4 of the money workers spent buying goods from US companies was almost directly back in workers' pockets, whilst by 2012 less that 1/14 of what workers spent buying goods from US companies ended back in workers' pockets.

All that excess money that doesn't get recycled back to workers anymore has got to be pooling somewhere.

It's both. If the price of homes aren't reflecting an affordable price, you have to ask, who's buying them? It's not the average family - it's corps sucking up homes as investment assets, driving up prices to sell to each other and the "lucky" family or two that get to empty out their retirement fund just to have a place to live. That's not reflective of a natural, reasonable increase. That's the result of hedge funds destroying the housing market for the rest of us, just to pad their bank accounts.

I agree. Something I wish we saw more of.

In the early 1900s we had huge fights for labor. Strikes yes, but also some literal armed fights.

We won a lot. They conceded a lot.

But they've eroded those wins, little by little, for a century or so.

This is what will ALWAYS happen when you live in a system explicitly designed to extract profit from workers and reward greed. It cannot be reformed. It cannot be controlled. It will always slide backwards into this. We need a different system altogether.

Yup, we could be creating an amazing life for more people - and damaging the environment less while we are at it; but instead "we" keep doubling down in the other direction

the west was on the right trajectory

A lot of the west is still on the right trajectory. It's the US that is not.

There are a lot of developed countries, especially in Europe, where the "American Dream" is much easier to attain than in America. But, more often than not, they don't even want that dream. For good reason.

Especially when we have a society with a huge number of people who think that if you're poor, you deserve it.

I'm so glad my Dad, also in his 80s, programs COBOL. My parents have owned their home since 86, but I'm sure that without the random COBOL job they'd have to do door dash or something as well.

As Mark Twain once said,

There are lies and there are big damned lies, and then there are statistics!

LBJ is probably the most WTF President of the 20th Century. He pushed the Civil Rights Act, and created the Vietnam fiasco.

I like this story. Someone who worked for Kennedy and Johnson put it this way; if JFK came into your office and saw you reading he'd assume you were working. If LBJ saw you reading a book he'd think you were goofing off.

I think most people would see the gulf between owning one moderately nice house and a small business [$1 million in 2024] and owning an estate with several acres and some horses, a half dozen cars, and enough in the savings account to keep a few families going. [$1 million in 1960]

we lost 4 bids and saw almost 2 dozen houses before finding a winner

Cash I understand, but what's the reasoning behind sellers preferring regular loans instead?

i had a lease on an apartment when the process started.

edit: honestly if the requirement were that you were homeless or next to it,i don't think anyone would ever apply for this program. the first application is daunting, and then there is the matter of actually shopping for a house.

Humans can't marry corporations.

fair warning: my application packet was around 100 pages

Why tho, republicans are fucking horrible people.

Hell, Clinton essentially adapted Reaganism for the Democratic Party.

dude ronald regan gave my family papers my cousins are named ronald and ronny

i am a communist too. sometimes bad people do good things

checks math

Everything checks out here

But then you would have to live in Davenport. I've never seen a more literal suburban hell. 30 minutes of side streets to go anywhere without traffic.

wow thats archaic we use the Puyi method now dude

My wife and I manage it because we both work.

I didn’t intend on marriage as a way to own a home but I couldn’t do it without my partner.

You're not renting it from yourself. You happen to be renting from a corporation that you happen to be sole director of. Gotta emulate what the rich do.

If you buy a house declared as investment, but you really intended to live there, it's mortgage fraud.

Generally, mortgages for your primary residence offer more favorable terms then ones for investment properties. The issue in the above story is likely related to the friend. If they had tried the same thing, their offer would likely have been even worse than what they got for a primary residence with a cosigner. Assuming they got an offer at all.

Most people's parents will end up selling their home to pay for cruise ships, and or palliative care.

Being born there, living your entire life there, your whole family and all your friends are there, you went to high school and college there so it's easier to transfer to a CSU for grad school, and cheaper because you won't have to pay non-resident fees, etc etc. The same reason people don't move from other places. Besides, it takes a lot of savings to move, especially out of state, especially when you have to keep going back and forth to look at places. There's also just not wanting to move. I am really not ok with being forced out of my home and away from my family because of bullshit like this.

And yes the weather really is that good - in Southern California.

I'm sorry, you think people that can't afford a basic living situation in California are able to up and move their entire lives that easily? Do you have any idea how much that costs?

Op is saying it's a problem of supply not meeting demand

You're saying that supply can't meet demand if the rich have infinite demand

These aren't exactly incompatible. I haven't seen good evidence that demand from the wealthy explains the massive increase in housing cost, but you can both build more housing to increase supply and try to limit the wealthy buying too much housing. They're not incompatible

That makes no senes. We can literally build as much as we want.

I know... let us build!!!!

In San Francisco, probably the most economically productive city in the US, the government adds over $200k to the cost of each house with just permitting process.

Arklaska?

Texas and california could easily fit an extra 50 million people. They're both massive.

What is SFR?

Yeah, I bought a couple years before and I’m glad I did, but it’s really sad to think of everyone who couldn’t or didn’t for whatever reason.

Everything is so messed up now and the uncertainty will probably continue for awhile.

That or they get elected/promoted.

Yeah, back in my day. A simple theft only got you a few days in jail. With inflation, we're looking months now for the same crime.

Shakes head

If we have more than $2k in assets, a number that hasn't changed since 1974, we lose our food and Medical on SSI, too.. it's ridiculous

A local realtor doesn't have the qualifications to make broad claims about income or affordability for the entire nation.

This is one of the problems caused by zoning laws in the United States, rather than move to a more productive city full of opportunities, you were forced to move to a less productive city because DC has artificially caused housing to be expensive.

People are moving for affordability rather than economic opportunities.

There are some pockets of affordability out there.

The map in this article is nice (though you have to scroll through some annoying stuff to get there):

https://www.cnn.com/interactive/2023/06/homes/housing-market-prices-affordability-dg/

I would guess those would be the areas of next major population influx as people continue to flee high cost of living in other areas. Climate change making much of the west and southeast more unattractive in the long run too. While the more affordable areas are still relatively cheap compared to the rest of the country, most of them have already been seeing large spikes in housing prices too. We need some major policy changes to encourage cheap and higher density housing, better use of land in general, can't just keep building only single family homes in low density areas sprawling out forever.

65% + 25% = 90%. Doesn't seem "ludicrously false" by that assertion; I wouldn't be surprised if the remaining 10% accounted for all individual landlords.

210k.

Condos in my area, part of Greater Boston, are going for $1.1mil at least, usually more in the $1.4mil range.

Even if I could somehow scrounge together 20% down that's monthly payments of over $7k at today's interest rates. After taxes 210 is more like 126, which is monthly a little over $10k. If I'm not saving anything for retirement and basically barely holding together the rest of my expenses and hoping to God nothing happens to my car, my body, my dog, my cat, or the condo, then I could afford the monthly payments.

Now imagine if I had jumped into that situation and then gotten laid off, like I was.

EDIT: it's worth clarifying that in big cities, the points talked about in this article are still true, just scaled up. Adults in their late 20s/early 30s working in tech are easily making 150k+. College grads in Computer Science are getting 6 figures easily. Making $200k was the high end of average but nothing unheard of.

And the prices here adjust to that, happily.

I would love to live in apartment if every one I ever lived in didn't have neighbors blasting their music at 3am.

Because living surrounded by lifeless cement is crime against humanity. People need home, not voluntary prisons.

He's catching downvotes like crazy, but he's 100% correct that average is a poor statistic for comparing things like home price and salaries. More specifically, average is typically used as a shorthand for "mean", when what's really useful is the median.

Median home price (or median salary) for that matter, will much more closely reflect what the typical person is paying for a house, while mean is going to be skewed by the long tail of expensive prices.

And also to back up Pixxelkick, that single number still doesn't accurately reflect the situation for first-time home buyers, which is the demographic these articles tend to focus on when bemoaning high home prices.

So it's not like anyone's saying home prices aren't going up, and there aren't problems with that, but it does get really annoying to see these articles CONSTANTLY peppered with misleading or irrelevant statistics by authors who either don't know what they mean, or worse are exaggerating to drive clicks.

This isn't just fox, this is every single media outlet and tik tok influencer and YouTube preacher everywhere, it's a constant falsehood.