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Boomer Doomer - The Other Side Of High Rents
Baby boomers now in their 50s have lower incomes, wealth, homeownership rates and more debt than generations before them, according to a report from the Harvard Joint Center for Housing Studies and the AARP Foundation. A third of Americans 50 and older spend more than 30% of their income on housing, while 37% of those 80 and older spend more than 30% on housing.
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Rising rents have been cited as a reason millennials aren’t moving out of their parents’ basements. But, as MarketWatch's Amy Hoak details, higher rents could force some boomers to move in with their children.
So says Don Lawby, president of the Real Property Management franchise, a property management company based in Utah. He says it is shaping up to be a crisis for some boomers for the following reasons:
- The average rent for a three-bedroom single-family home in the U.S. was $1,363 in the third quarter of 2015, a 5.7% increase over the last year, according to Real Property Management and Rent Range, a rental information company.
- Workers 55 and over have, on average, saved only $150,300 for retirement, according to a Fidelity report from 2013. Assuming they withdraw 4% of their savings for income in retirement, their savings will generate about $500 a month, Lawby figured. With Social Security benefits, monthly income will average $1,791 (using figures from the Social Security website).
- That monthly income means the average retiree is likely to have a housing budget of $609 to $681 a month (going by the recommendation that 34% to 38% of income be used toward housing costs), way below the cost of renting a three-bedroom home.
Rental growth rates are the highest they’ve been since the recession, said Ryan Severino, senior economist and director of research for Reis, Inc., a provider of commercial real estate information. Reis data shows that rents rose more than 4% over the last 12 months.
“Vacancies have been tight for a very long period of time,” Severino said. “That kind of environment gives landlords leverage to raise rents.” Rents are eventually expected to taper off, however, as more apartment inventory hits the market, he added.
Yet some don’t see that tapering off happening soon. A recent Rent.com survey of more than 500 property managers predicted rents would rise an average of 8% over the next year. Eighty-eight percent of property managers surveyed said they raised their rent in the last 12 months. The report also found that rental vacancies were at a 20-year low.
Steep rises in rent make it very difficult for tenants to keep up, “unless you’re in the job market and in a position where your salary is moving with the cost of living as it increases,” Lawby said. And he’s not just talking about retirees already living on fixed incomes. If you are a boomer who lost a job during the downturn, it is quite possible that your employment opportunities have been limited and salary increases have stalled, he added.
“The boomers, they’ve come into an environment that, generally speaking, hasn’t been positive financially for many of them,” Lawby said.
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fk em. Ya'll got to comfortable and trusting.
had drinks with a 39 year old making 60-70k a year and still has to rent with a room mate and another 34 year making roughly the same sharing a 3 bedroom in Hoboken nj due to run away rents
To hell with the boomers. Brainwashed idiots who took the blue pill and passed on their debt to future generations.
Get a load of this BS;
“The boomers, they’ve come into an environment that, generally speaking, hasn’t been positive financially for many of them,” Lawby said.
They lived thru the most prosperous times ever while piling up the most personal debt ever! Programmed debt slaves. People used to save up for a home or, at least, pay down their mortgage well ahead of retirement. I know one who bought a house, mortgaged to the hilt, at 60 years old. I know an 80+ yr old couple who loaded their 40+ yr old home with debt(well over 100%) in 2006. The old couple told me their goal was to leave the house to the bank! Dollar holders and tax payers will get the bill.Oh cry us a fucking river, Boomers. Try being 20-30 years younger and starting a family in this shit.
Exactly. Can anyone name a worse job market for young people in US history?
1980 wasn't all peaches and cream - but I still have to agree - now is a little bit worse.
If Jimmy Carter would haver had another 4 years then it would have been worse than today.
I was in my early 20 during the Carter/Reagan years. I can tell you it was really rough to find a job and have enough to pay rent-even if you were a graduate, but if you were you had a lot more leverage. Not so today for the newly graduated. The young people that blame the boomers on the problems of today have no place to talk. What about the student loans you agreed to? No one forced you to sign that college entry, just as they didn't force us to buy a home when everyone was saying it was a solid investment. Now if you are referring to the early baby boomers-that is another reality. The ones that grew up in the early 60's could go to college for cheap and get a very nice job that could support a family. They had time to save up and spend. The party ended in 1971, then it all went to hell in a handbasket. I was in grade school when that happened.
Ignoring the student loans altogether, kids are still getting reamed by the inherited economy far worse than anyone in recent history. Maybe 5-10% of my graduating class (Finance at a state school) broke the industry, even when pretending accounting, insurance sales, and audit jobs are finance. I dont even work with anyone who graduated after 2012 who hasnt been laid off from a job and I work predominantly with the top quartile or so.
Im sure the 80's were tough but this is a whole different beast. My parents had shitty jobs when they were my age too - they used that shitty income to support two degrees, a masters, a house in a city, two decent cars, and later three kids. Now a single guy couldnt get by on minimum wage without roomates and/or govt support.
The party may have started winding down in '71 but it still kept going for a few decades.
it was the summer of 1861, and none of the young men were around to work, in fact there was no work to be had, but there was war...
As a frugal boomer who learned from my depression era parents, I am very sad for the current generation. I have no debt and have been helping my son who seem to have liftoff finally. But the world looks like Dosidi under the Gowachin bankers. I see no way out. And just wait for the fruits of genetic engineering Windup Girl.
Re: Wind Up Girl...
chai na krup...we will all be living in Thailand soon enough. Good read, too bad the author pulled too many punches.
Nice take btw!
I like Thailand. The "riots" were actually a big party except for blocking the traffic. You know where you stand there and I could move there but my wife will not go. Friends ask me if it is safer there and I say no, but at least the cost of living is reasonable which evens up the odds. Bribery is affordable.
Well when frugal boomers need nursing care/homes and people to cook and bathe them. That money will be gone VERY quickly.
Build good relationships with your kids, don't kick them to curb and say figure it out. It'll come back to bite you.
3 generation households have plusses and minuses, but overall beat the hell out of US fire and forget generations.
Not me muttha fukker. Lived in the same house for 26yrs now, own smart cars (paid for), have a precious metals stockpile, lead and lead delivery stockpile, and good health at 62 years young :P
not only that, they get their medical care and social security as promised (sans COLA this year, though - sign of things to come). they get better medical care than most starter jobs would provide. Let them get some roomates if they can't afford the rent, that's what any of us would have to do
You are letting your *stupid* show. Its not a 'boomer' thing, its a people thing. Like comedian Lenny Bruce once said, 'we are all the same schmuck'. To blame it all on the boomers is disingenious, misinformed and just plain ignorant. Parroting things you hear in the media and from other people is a poor excuse for being too lazy to form your own opinion.
It's a people thing from that era we called the baby boomers.
that's his cover story to hide his gay life choice
I was living in Hoboken in 1985-6 under similar inflation-adjusted conditions. PATH, maxwell's and Italian American deli's kept me from commiting suicide.
I graduated from college in 1980. Think Jimmy Carter economy - look up stagflation - not much has changed except the prime interest rate was 18% - 20%.
A good friend I graduated with (both HS and college) got a job in NYC (his dad had connections) we had similar jobs - except mine was in Iowa.
He comes "home" for a visit and he is bragging about how much money he is making - he was making almost double what I was earning. Why didn't I come get a job in NY and make the big bucks?
After a few drinks he asks me if I can loan him a few bucks.
I have a new car, live in a nice 2BR apartment BY MYSELF, am saving money every month and am happier than a pig in shit - never had this much money before.
We go to my place and have a few more shots - he tells me he is flat broke - living expenses in NYC are killing him - he is sharing a 2BR shithole apartment with 3 other guys - can't manage to save a dime - and can barely afford food sometimes.
If you are 39 and still need a roommate you have done something wrong.
Yep I feel both sides of that story. My gf and I live and work in Manhattan. We both make way more than we did in Cincinnati Ohio.
we gave up 2 cars (her VW jetta and my 350z) my motorcycle and two 1 bedroom apartments.
for a 1 bedroom and no vehicles. We also eat out less, save less and drink more.
Gave up your 350Z. I love those cars.
I lusted after a Datsun 280ZX for a while (I am old) - I couldn't get the dealer to budge off of MSRP - it was a 10TH anniversary edition or something special - but it was a 1980 model and the 1981 models were out!
I ended up with a 1981 Turbo Trans Am - I had just rolled my 1980 TA and I needed a car.
http://my350z.com/forum/buying-leasing/596416-help-pricing-my-z-for-sale.html
hella miss it...
I would have done alot more mods but didnt own it long enough to pay it off. I would love to have a datsun 240z
I can appreciate your choice on the trans am.
Who would down arrow a 350Z, 280ZX or Turbo TA?
someone holding keys to Yugo or Lada
first mistake...living in NJ
a 39 year old making 60-70k a year and still has to rent with a room mate and another 34 year making roughly the same sharing a 3 bedroom in Hoboken nj due to run away rents
Bulllshit I say. I live (if you can call it that) on about 25k a year how does that asshole manage to mess up his finances that bad?
Student loans?
Child support/alimony?
cocaine? strippers?
Taxes!
60-70K ain't shit in Jersey or any big American city. You can't rent an apartment for yourself AND save any money on that shit salary. Gotta get 1-3 roommates and split the rent and utilities.
Huh? When I lived in Fort Lee (nicer than Hoboken) I made shit and could swing it, that was 1993 though. Still, to think you make $1500 a week and have roomies just sucks. I'd move to a dump in Newark and hoof it, Lol.
Lots of boomers didn't save for retirement. I did but look at all the interest income I'm getting on it at the bank. And prices for things I actually buy like dental work is sky high. Maybe those non-savers were right. There is no light at the end of this tunnel.
Glad it ain't me
Bullshit. Boomers control the majority of the wealth in the world.
Uhm. Sorry: Boomers control the majority of the CRUMBS that the elites allow their serfs.
But it is important to remember that these 'wealthy' boomers are just a subset of the boomers-at-large. Many (if not most) have been irresponsible little children for most of their lives, so they end up in trouble at the end, especially for their health and finances. They were trained to think that being pitiful means someone will take care of you - if not, then just become more pitiful and cry louder!
In general though, I don't think rent can go much higher without crashing real estate: people can (and do) just end up renting cheaper (smaller) or going back to having flat mates - rent demand has a lot of slack, so all the fools with fortunes tied into real estate are likely to end up with no choice but to lower their rent demands or keep the places they own empty.
That being said, I wonder if part of the purpose to the refugee exodus is to buttress rental values in spite of collapsing demand due to everyone being so damned broke all over Europe, for so long now?
Enter the micro home! Don't you dare call it a trailer, that's where po' folk live.
http://buildinghomegarden.com/micro-homes.html
I don't mind these, if anything the best thing about them is the big " Fuck You " to the credit pushers that want us buying 300K homes.
I mostly see them as a psy-op, in the sense that they go way too far (ie: they make unplugging seem like it requires living in a space too small to even be feasible as a claustrophobic jail cell), in a way that also requires a significant amount of money (tens of thousands of dollars, at least), as well as requiring a 'friend' to offer free land for you to keep your embarrassing closet home and self in.
The reality of it is that there are many simpler and cheaper ways to achieve a cheap, largely unplugged lifestyle, but the MSM is doing its utmost to make people think unplugging is actually terrible, expensive and embarrassing!
id much rather be a "po folk" that owns a "shitty micro home" than a, whatever everyone else is, that rents. If I lost my job I would have a month or two to find another before im on the streets.
now thats freedom.
Yes, "wealthy boomers" are just a subset of the Boomer population.....
But as a Boomer myself, I can vouch for my generation's irresponsible behavior of charging up fantastic credit debt, buying a too expensive home and autos far beyond their ability to pay. Those within the professional class of Boomers continue making preposterous, meangingles purchases.
In essence, the Boomer influence on finance, politics, and the banking/credit world has been largely negative.And it's one of the reasons why the millenials and slightly older generation are struggling so badly.
I'm glad I woke up to "reality" a few years ago before becoming permanently entrapped by that culture.
Boomers is gud boyz, dey Dindunuffin! Privileged Millenials stole all the money. Raise taxes on them white privileged bitches! Justice! #OldLivesMatter!
None of the Youth boycott so they keep raising prices.
When will the younger people kill the beast by cutting out their iPhones and living in Manhattan?
if they were going to they would have by now.
So never.
LoP - boomers <> rich. Rich is multi-generational and has nothing to do with the year of birth. See: Rothchild, Kennedy, etc.
Thinking that the Boomers are holding you back gets you nowhere. If I'm missing something, enlighten me.
God how I hate real estate investors and landlords. I can't wait for the bottom to drop out of the real estate market, so they lose it all.
didn't that recently happen??
Nope, it looked like it might happen and TPTB freaked out, halting it by any means necessary.
ya but that wasn't done to protect the landlord and rental class, that was done because all of those property "investments" were sitting on the big banks balance sheets and would have wiped them out had the free market been allowed to work its magic. In reality, protecting existing home owners' "value" had nothing to do with it.
hear hear, i'm also quite sick of "real estate always comes back and goes higher everytime". Real estate has only gone higher since the late 70's due to 17% mortgage rates at the time and a much stronger dollar. When i ask real estate agents what will happen if rates find equilibrium once the fed loses control and they look at me like i have 3 heads.
Same for the Bond King....whats his face...gross. bought every selloff and was lucky rates ended up lower everytime
Hey, I am a real estate investor and a landlord. None of my tenants have anything to complain about.
I have no raised their rents since they moved in and maintain the properties.
I hope that the tenants I have now will stay for a very long time and unless the local government jacks up my property taxes their rent will remain where it is.
I realise that I am likely not the average landlord.
When all those people lost their homes and said, renting is sooo much cheaper, I knew it was a huge set up.. Rent never goes down, year after year, it just keeps going up, especially with a captive audience.. Buy a small house in a realistic neighborhood, pay it off fast and keep it well maintained..
Everything is a risk, but agree.
It is that crucial last sentence that so many overlook. Buy a starter house, stay in a starter house.
If market values drop by X percent then your actual $ loss will be less than in a higher priced house and if you have to sell there is likely to still be a market of downsizers.
Then the neighorhood goes to hell and your your little house becomes dangerously uninhabitable. What do you do then?
You can thank Section 8 for that. I've witnessed it more than once. Staying mobile is the only alternative, as long as the Fed. gov. exists.
I agree about staying mobile. I have savings and almost no debt to speak of, we have two paid off cars. I rent a three bedroom for 975, the house is worth about 130k(near he east coast of central FL), so with 20% down on it Id be paying a decent bit less per month, but I think EVERYTHING property related is massively overvalued. If I suddenly needed to move due to job, whatever, I don't want to be stuck with an anchor around my neck, which is exactly what a house wroth less than you paid for it will become.
If renting to people is working out for yall, then good for you, seriously. Its certainly working out for the owners of my house, we will have ben here three years in a few months, always pay on time, and take good care of the house, but not everyone renting a house out is lucky enough to have someone like me renting it. My personnal plan is to keep renting for the forseeable future and keep saving money. One day, hopefully, if things go according to plan, Ill be able to buy a place out in the boonies enough to not have to worry about it geting surrounded by section 8 type shit, and pay for it(mostly, at least) with cash, something that I don't need to finance more than 30% of.
Voted you up, buddy. Sounds like you have some good financial sense about you. I have personally found that the "boonies" can be a county or parish that does not have a bus service. By and large, Section 8 shit always needs to live within reasonable walking distance of a transit stop. Nome sayin?
Rent it out, or sell it to a wannabe landlord.
It isn't like you wouldn't have had to pay something to sleep indoors in the meantime.
"Then the neighorhood goes to hell and your your little house becomes dangerously uninhabitable. What do you do then?'
"...pull it!"
-Lucky Larry S.
You need two friends: Smith, and Wesson
Owning a house is like having a money pit: if it isn't the roof needing to be changed or fixed, then its the plumbing, or rodents or termites eating away at stuff, or poisonous fungi, or bad neighbors moving in, or the added municipal taxes, etc.
How about just not having to bother with contractors or with home building skills (I have lots of very useful and fun computer programming, martial arts, etc. skills instead - home building is not my current priority, and there is only so much time in the day).
'The Man' is tryin' to put the squeeze on us. Problem for him is that I am slippery as an eel and super adaptable: I live great now on super low costs, and I don't need to accumulate hundreds of thousands of dollars' worth of wealth (ie: decades of work for 'The Man') in order to get here.
Renting fits great with unplugging from the system: never give them more than the minimum, and never fall for their scams, which always make you think you'll be better off by getting in deeper.
As a landlord, I fully support your thinking. Keep it up.
Capitalism at work.
You get to gamble on interest rates going down and driving up the price of "your"(The county government's) property with MASSIVE leverage, and I get to pick up and go with no strings attached when da brudda's turn the area into a ghetto or da gubmint decides to raise interest rates and plunge all the "owners" into upsidedown mortgages, foreclosures, etc.
that's why it isn't just about the house.. it is about the LAND... get enough and you won't even see your neighbors
"Massive" leverage - from the rentier's perspective, do you think that this is a good thing or a bad thing? If the loans were 100% LTV and real estate tanked, what does the landlord do? I couldn't get 100% LTV loans. If that had been offered at a low rate, I would have done so. I'd be happy to see the bank assume the entirety of the risk. Alas, loans on rental properties are limited to 70-75% LTV.
Why assume "gambling on interest rates"? My loans are 30 yr fixed. So while rents go up year over year, my largest cost remains fixed. It always amazes me to see folks come on and think that they're so smart to be renting and that landlords are somehow foolish to be doing their thing. Keep thinking that and I'll keep putting that rent in the bank.
And anybody doing their due diligence doesn't go buying property in areas that have a high likelihood of turning into a ghetto. I suppose plenty of folks don't do that due diligence however...
Nevertheless, just keep on renting and telling yourself that the gov't is out to get you and so you shouldn't ever become a homeowner.
You are "putting [your] rent" into interest, not "in[to] the bank". Sorry. Now go ahead and get all angry and nasty and assure me and all the other ZH-ers here that I am wrong, stupid, and don't know what I am talking about. Tell us confidently how you are doing it differently, making extra payments, planning to pay off your crib early, etc. etc.. I have heard it all before, dozens of times. Rarely have I ever seen it in reality. Some folks begin that path but inevitably get sidetracked by the arrival of children, layoffs, medical expenses, what have you. Thirty years later they have paid the proverbial shit load of interest that more than offsets any capital appreciation that they realize in the sale of their house.
+1. Plus he's an idiot for thinking it's his money at his bank. LOL stupid statist tards.
Remember, too, you paid closing costs to get in. You will pay 30 years worth of property taxes unpaid by renters, and you will pay 4-5 percent commission on the sale of your "real estate" when that time arrives.
These are tangible numbers that add up.
I always appreciated the honest landlords I've had - those that aim to attract good tenants by offering good value as well. I know more than most how much work and risk is involved in owning and renting real estate.
In fact, I think most people don't calculate their time, stress, and the hidden costs well enough, but end up enamored by the idea of owning so much, regardless of the huge debt most carry as a result. When you have a need to make huge payments every month, then you really can't afford any kind of bump in the road, ya know?
In addition, unplugging allows you lots of FREE TIME, which is key to happiness. I don't know any landlord with much free time.
Sounds like an opportunity to me, SRO Granny Flats for the win.
Yes & it's a set up, too. Designed to impoverish.
Yet we have a massive overcapacity of houses and shadow inventory is filled to bursting. America - where millions are homeless and there are millions of empty homes.
Surprised I had to scroll down this far to find this fact. If the banks had to liquidate all of their housing hiding on the books, there would be plenty of affordable housing.
That really wouldn't matter this time, since more and more Americans have lost good paying jobs so as too make even a cheap house unaffordable. Consider that food, energy, taxes, and daily living won't be going down. Bankrupt is bankrupt and the cities and states and feds are all that and more. Thus they would take an even greater pound of flesh, not less.
The rent VS buy comparison never includes a section on what happens when you are retired / are 70 years old.
Is it just so obvious that it doesn't need to even be stated?
You pay the fucking mortgage off when you are fifty something and then when you are retired - even though you still have to pay property taxes, insurance and upkeep - it will still be cheaper VS paying rent.
We are retired (mid-sixties) and living in Mexico. Over our 35 year marriage we have lived in 5 different houses. 4 of the 5 we purchased for cash. We both worked and would never consider borrowing to buy a house. We never lost money on a house - but we only made some money on the last one. We have never paid a penny in credit card interest. The house we last lived in in the US had about $12K USD property taxes per year. The house we have in Mexico (which cost us what our last house in the US cost us in 1998) has < $1K USD property taxes. We have solar panels and pay about 2 dollars per month for electricity - in the US it was perhaps 300-400 USD per month when we needed to run the A/C. I can have a very qualified plumber or electrician come buy and after 2-3 hours he will ask for $20-30 USD. We don't have home owner's insurance - but since we didn't have a mortgage in the US we didn't have insurance there either. Those are the sort of ways you can really sock away money over time.
Hard to move at this point - our first grandchild is on the way - my daughter & SIL live a few blocks away -
This reminds me that there are more important things in life than money - but that is sure easier to say when you have some.
If I go into the Walmart off of Southmore it is sort of like being in Mexico - so I have that.
I also have a gun collection - Mexico is not a very gun friendly place - I am sort of a cold dead hands type - so that isn't going to work for me.
True - we have no real family left - we both come from rather dysfunctional families. The friends we have are very close.
The town we live in has a Walmart, Costco, Sam's, Office Depot, Office Max, and on and on.
While we don't currently have a gun - we are allowed to have one for protecting ourselves in our house. I believe we need to purchase that gun from the Mexican government. That is something we may look into at some point.
You have no children. Your life is a failure and your opinions are irrelevant. Neither of you should be allowed to vote and your childless wife is literally an abomination.
I find you the most vile person on ZH.
I hope you get the future you deserve.
I would bet a huge amount of money that "Thick Willy" has never reproduced and never will. He has a grand fantasy life in which he has many descendents, but there is no female that would sleep with him, and if by some bizarre chance one did and got pregnant, she'd get an abortion asap. Thank goodness.
I'm a white man so my very birth into this world was already an act of violent revolution against the powers that are genociding my people across the globe. Believe me, they don't want white men being born. Yet I have survived and thrived. We are too strong for you to destroy. But you at not too strong for us to crush. Remember that.
As I wrote, you have never reproduced. But you spend your time berating other people who haven't. By berating them, you think you are magically increasing the chance that you will reproduce. Magical thinking. Also, your insults are grounded in your (rational) fear that you will never find a woman who will reproduce with you.
Unless you change as a person, I can tell you with total confidence that you will never, ever reproduce; that any woman you get pregnant (the odds are vanishingly small) will abort the kid. BTW, I didn't really mean "thank goodness" about that; it was just irritation. However, the basic picture is true: women don't want to have kids with the sort of asshole-freak you are. You are like a walking, talking, typing ad for "Plan B." But go ahead, keep insulting people like divedivedive - all the while in fact doing the same as he did (not reproducing).
Along with your fantasy of having loads of kids, you have a fantasy of crushing people who aren't white. Yawn. You do have a lot of fantasies.
I do wonder if it would be possible for you to grow up and be a person who a) doesn't nastily insult people who don't reproduce and b) thereby becomes someone who might himself reproduce. I'm guessing no, but people do sometimes grow up; you might give it a try.
Way harsh even if it was sarcasm. Mean, man.
The escalating property taxes will drive the ownership in the USA - counties and states are broke - absent bankruptcy the homeowners will pay the freight
will affect the value tremendously very soon
Renters pay property taxes too - just becomes part of their rent - and if they jack property taxes too high people will vote to limit the increase.
Public sector pensions (rock) <politicians> property tax increase (hard place)
Dive- thanks for sharing. I like Mexico and have thought about the possibility of moving there. Glad to here it is working well for you. My main experience was Mexico City. I would have to learn about other less crowded place but I had a great experience there and felt safer than in NYC
I love Mexico City and visit there perhaps 6 times a year. I was born in the shadow of the George Washington Bridge. Spent a lot of time in the 'city'. We feel as safe here as anywhere in the US - you just can't be stupid.
To all-priced-in, I wouldn't count on it. A 30 year note will cost you so much in interest that the "still will be cheaper" position is faulty. Most homeowners have little to no idea of the total interest amount of their loan . And, at 50 something (is that age 52 or age 58?) your principal/capital is now locked up in a house and is not available to you until you liquidate it by selling. When you do sell, you will pay 4-5% commission to do so. If you do the math then (very few do) you will find that you paid more in interest than your capital gains thus realizing a loss of your investment. Tisk, tisk, it is true.
And, so many married couples end up wrecking their real estate investment with divorce. They generally lose most of their "invested" capital in the split by having to pay their attorneys, then they both end up without that particular house at some point, and neglect to acknowledge that the interest paid is now just gone. If you are married, I do not wish divorce on you. I am just sayin . . .
I am a CPA (retired) have an MBA - worked as a financial analyst - controller - CFO and VP of operations I think I understand what the cost of money is. I also have done tax returns for many clients with rental property.
We did the 30 year mortgage - but we paid it off in 11 years. 8.05% interest rate!
You must not relalize - when you rent you still pay for everything that owning a similar place will cost - INCLUDING INTEREST. The difference is when you have a mortgage you can pay it off and stop paying interest - if you rent for 50 years you pay interest (hiding in your rent payment) for 50 years.
Property taxes, insurance, new roof every 20 years, paint, plumbing problems, repairs to the HVAC - it is all in there.
PLUS - you are also paying interest on the value of the property - unless you are renting from your grandmother - every landlord will factor in his cost of capital - and that is true whether he has a loan or not against the property.
PLUS PLUS - he then adds some profit on top
I will - just to be honest and complete - say a landlord can write off the cost of the house as depreciation - some of this savings may get passed on to you - but I doubt it - you also have a chance at getting a tax break if you own so I would call it a wash or slight advantage to renting tax wise.
I rented a place until I was about 30 years old - because I knew my job was going to require me to move every couple years. But if I would have rented a place back in 1988 (the place I still live) I am pretty sure my rent would now be much higher in a cash out of my pocket every year basis.
Nothing is always true - some times renting can end up being less - but on average if you plan to stay in one place for years - owning is better.
If you're on a fixed income you're insane if you're renting a 3 bedroom house in a major metropolitan area.
There are houses in resort towns a couple hours away from the large city I live near that can be covered for half the rents listed. And surprise, a bunch of retired fixed-income people live there.
The flip side of this is... retirees wouldn't be renting if they hadn't fucking cash-out refi'd their house a half dozen times before the foreclosure. My place is paid off 15 years before retirement, not because of my wealth, but because I didn't freaking move into a new mcmansion every 7 years and jack my mortgage up. This shit is not hard.
you don't sound very Merican
yeah I learned my lesson...
Buy land and am building what I want. Sure it takes longer and I have to rent for now. In 5 years I will own exactly what I want/need and fuck a damn mortgage.
taxes will fuck you in the end.lol. i know many people without a mortgage who are paying 10000+ in taxes/yr for a 3 br ranch house.
Not around these parts. There will be taxes, but not nearly that much.
"This shit is not hard."
So completely with you. First thought I had when reading this was "why the fuck would an empty nest couple need 3 bedrooms?" I grew up family of 4 in a 2 bedroom / 1200 sqft house and we were fine. God forbid a child share a bedroom with another child, or that people actually exist in somewhat close proximity in the living room. Buncha spoiled brats, boomers.
Since i am a single boomer and rather give my money to my kids than a landlord and haven't lived in a house since they grew up, I have moved in with one of them to help them with their mortgage. If i were still married i would not have the option, but some of the other boomers could do the same. Sure the kids can be loud, but my fan is louder and I can close the door anytime :)
Not all us boomers gained from the ruined economy, just the ones you need to hang. I worked hard for what I have and I will pass it one, even if it gets lost in a boat accident somehow.
@ seek - thats how 'the villages' near Ocala, FL are. its about an hour and a half outside orlando, and its MUCH cheaper to live there than in any major city. Its full of old people, 55 and up, many of whom are on fixed incomes. There are golf courses everywhere, and paths between all the neighborhoods and all the resturants/shopping centers in town, so unless they need to go more than a couple miles from their house, which they rarely do, they just take golf carts everywhere. Works out great if you have a few too many drinks at dinner, as you never have to go on a public road, and the cops NEVER bother people on golf carts. They look like thay are all having a great time too, and its gotta be 30-50% cheaper than any major metropolitan area too. Houses are way too close together for my liking, but you are right, there are so many places like this out there that anyone who chooses to be retired and still live in a big expensive city have no one to blame but themselves.
So if i'm an average young person living with my parents, and my parents have to move in with me, where do we live?
they move into your bedroom and the chinese take over the house
Escherville.
They get your room, you get the El Camino.
or, A VAN DOWN BY THE RIVER!!!
save those boxes from large appliances
+100
FUCK THE BOOMERS !!
"Fuck me? Fuck you!
...Now he's just a Navajo mud toy."
If you're at retirement and loaded with debt, you screwed up.
Or you got sick once.
No, they did as 'programmed'. Good job debt slaves! Now, die early and save the the banksters the trouble.
http://business.time.com/2013/08/14/a-good-death-how-boomers-will-change...
They bought into the socialist marxist 60'2 utopia. Now eat your peas
The idea of universal retirement is a new one (last 60-70 years). Six kids has it so I'll never retire. My choice and they like me for it.
It's not just boomers.
It's practically everybody NOT writing code for some bullshit entertainment gizmo. Little else pays much, and NONE of it will be very lucrative when even that is outsourced or assailed in the next crash.
While food, water, and shelter will occupy all of our minds, the looney thinking about shacks and rental rates will seem quite bizarre when the fast-approaching earthquake finally strikes.
Our condition may well leave us wondering what the hell we thought we were doing while soooo much, far more basic and important, seldom seemed to matter.
m
FUCK the BOOMERS!! Worst generation ever. Greed, greed, greed, stupidity, arrogance, narcissism.. Just fuck 'em
We are not all Donald Trump.
Stupid white man.
It's all about the choices that we make when we are younger. FUCK EM is right. I have never owned a new car, rarely go on vacation, and guess what I do not worry about feeding me and my family in return of being prudent. Funny how that works.
Meh. Hard to keep that up in the long term. Hard to mindfuck yourself into working hard for money you don't need, enjoy, or spend. At some point you just wonder what the point of it all is? To make some numbers in a database increase? What does it matter?
Why not reduce the database entry slightly to buy an awesome car you will immensely enjoy? Or on an awesome trip you'll always remember? It's only money while LIFE is what you're missing out on.
Download some database software, create a little webapp front end, and create an account for yourself with 50 gorillion dollas in it or whatever you think will make you happy. Then go buy a BMW and live a little.
It's all about the choices that we make when we are younger. FUCK EM is right. I have never owned a new car, rarely go on vacation, and guess what I do not worry about feeding me and my family in return of being prudent. Funny how that works.
Anyone ever chart housing prices and rents versus the advent of the Home and Garden Network and the rise of "Flip this House" shows?
Try the advent of GSEs.
What do you call a prostitute with cum on her face?
A taxi. Her job's done.
"A recent Rent.com survey of more than 500 property managers predicted rents would rise an average of 8% over the next year."
See, it is different this time...
All a quote like that tells me, is that a good -$Bitch slap lies right around the corner. He guys (landlords), there are cycles for everything - even your bulletproof rental properties. And this one is gonna land you prostrate.
it is all fun and games...till they show up at your house with pitchforks and burn your wall street funded mansion to the ground!
TIL how many people are too stupid to distinguish "boomers" from "The corporate elite that has been screwing us over since Bretton Woods and/or the creation of the federal reserve."
But that's complicated and takes thinking. It's easer to drink the media Kool aid and blame a generation whose major flaw was believing in what the government and the schools taught them.
I think the major flaw is voting themselves ever more benefits with disregard of the impact on coming generations.
I don't blame all. But I admit that I am bitter about it. Any boomer who invested in the stock market and bought real estate received a massive risk-free windfall and the rest of us young folks got hosed since housing is now unaffordable and the markets are so juiced that investing at highs is almost a guaranteed loss.
The assumptions were quite different. Remember, this is pre-internet. Nobody on Reddit or any other forum called you on your bullshit immediately. You couldn't fact check in a few seconds. It took trips to the library. Letters to experts. Research. Few did this full time. We believed what we were told in school and college and on the nightly news. There simply wasn't the kind of cross checking you take for granted today. There was only the mass media propaganda that started in earnest in the 70s and is still with us today.
So, we assumed ever increasing prosperity. We had no idea that all of the prosperity since the 80s was fake, bought by an ever growing debt. We thought technology and govenment would eventually solve all the problems. Were we naive? Yes, but no more so than any other generation.
When I mention to twenty-somethings that we might just never solve the energy crisis - that when all energetically and economically profitable hydrocarbon energy sources finally run out in 50 year or so, that we just may starve 6 billion people (or more), they get queasy and pissy at me and say, "Surely that won't happen. Technology will save us!"
Young people today are just as foolish, fact free and optimistic as we were. And they will be just as wrong.
we are already seeing an uptick in homeless boomers. lots of senior citizens on the streets now.
And veterans.
My grandfather was a WWII veteran and he died just a few years back.
The people you're talking about on the streets a largely mercenaries that wasted their govt cheese.
Ah, yes. The good war. The house of Morgan got their war in Europe, the Rockefellers got their war in Asia, and Truman committed the worst war crimes in the history of mankind, if you discount Dresden.
Yeah actually he was drafted and fought against the Japanese...you know the guys that attacked the US without provocation?
Admittedly the fire bombings of Tokyo and the use of atomic weapons on Japan were not exactly laudable, but my grandfather had no abikty to change the course of the entire war nor what was taking place in Europe.
Compare that to the soldiers of today: No draft, all volunteer army in a war in which we were not actually attacked by a military power. I was of the age when the call for recruitment went out for Iraq and I said fuck that while watching all the hapless jackasses, fuck ups, and general douchbags with no other future sign up for free shit many claiming they couldn't wait to make a buck and shoot some "sand niggers". But you know what? You're right the men who fought in WWII are exactly the same.
Houston has apartments popping up on every corner and no one living in them. Bubble. They also have new trucks and cars being stored in vacant lots and at the top of parking garages. Bubble. They are also building new houses everywhere. Bubble. Now all the oil companies are laying off. Popped bubble.
Guess what happens next?
According to Harry Reid, there will be an uptick in cowboy poetry.
Ya, back in December I was looking at a home near Houston that needed bigtime repairs. Called the realtor about it and she says "I can get in line behind 7 others who are bidding it up... its a cash only deal, and you'll need about $250,000 to even be in the ball park... ya hear me?"
"I don't think so... I ain't got $250,000 cash I want to dump into that..." I says, and hangs up.
Last week the same lady calls me back and says... "Hey! You remember me? That place is still for sale, and you can get it now for $125,000 with only 3 percent down..."
Location, location, location.
No one wants to live in Houston if they can avoid it. (Full disclosure: I used to live in Houston.)
But, everyone wants to live in Manhattan, SF, LA, Chicago - or Dallas or Austin for that matter.
"Exactly. Can anyone name a worse job market for young people in US history?"
No and, not JUST the young, thank the leaders(Dems mostly) on 1600 Penn for starters for this debacle to begin with.
With 48 million + Americans OUT of a job, ANY job, WHY the hades are we at warp 9 bringing in more and more and more Muslims, and Hispanic illegals (other than to gain a permanent Dem controlled gvt).
And making American born citizens QUIT their jobs, and IF they want severance benefits, TRAIN the FOREIGN worker to replace themselves!!!,is this insanity or what?.
But it makes total sense, America AS WE knew it HAD to be brought DOWN for the NWO to have any chance of their mission success..
"Workers 55 and over have, on average, saved only $150,300 for retirement"
And who's fault is that? When you consider the relatively low taxes and health care costs along with the great stock market returns in the 90's and 00's they have no one to blame but themselves.
But their solution is likely to demand that the government further bankrupt those of us who still have 35 years until we retire. And enough of them vote that you'll have idiots like Hillary and Bernie lining up to give them whatever they want.
Boomers (and everybody else) needs to leave the U.S. for greener pastures. Rents in Ecuador are $200 - $500.
http://yourescapetoecuador.com/retirement/why-should-you-retire-in-ecuador/
I keep reading this expat stuff and I have to ask. When did LatAm or SoAm get all multicultural? When the SHTF down there they will eat your gringo ass alive. Your maid will cut your throat in your sleep to feed her family one more day. Same applies if you are white and living in East LA or South Dallas etc. Location-location-location. I'm bugging out to the middle of bumfuck, Idaho with enough ammo and food to survive rough til the zombie hordes burn out. This assumes of course I bug out early as once it starts you gotta stay put. I live outside of White Bread Small Town, East TX so if caught here it is not such a bad place to be. We have local friends so if our location looks bad, we'll move down the dirt road a ways. Just need to blow a few bridges on I-20 to slow down the Dallas hordes if the Army does not do that for us. *note to self, pick up some bricks of C4.
I keep trying to picture 100,000 morbidly obese FSA slobs waddling down I-20 moaning and forlornly waving their EBT cards. It'll be like a Zombie Apocalypse. Future historians won't have enough zeroes to account for the die-off.
The "greatest generation" my ass.
Anyone here, patting themselves on the back for thriving in this mess (not mere survival) is fortunate. Not any smarter than the rest of us. There is no such think as luck in an ordered universe. So, stop patting yourself on the back, and prepare your mind to be a good Samaritan. The real shite has not even flown just yet ..
https://app.box.com/s/hfgvcqg7gqh7i27at6sv53ywu87lwarp (Read Me First)
I am way ahead of the curve on this trend. I have been going down to the dumpster out back of Sears these past 2 yrs collecting refrigerator boxes. I must have 40 or 50 of them stacked up out in the barn. I will be a major landlord soon! Get your box now, there won't be many left after the collapse.
This is yet another disaster that falls squarely on the shoulders of the Fed. After fostering a massive real estate bubble which crashed, instead of letting the market clear, they decided to push rates to zero and leave them there allowing Wall St. to buy up single family homes and properties to rent. Then the Fed started buying mortgages up to further boost housing prices as if zero rates weren't enough. Then they kept Freddie and Fannie going, along with other agencies and started all sorts of HAMP, HARP and other BS programs to push housing costs upwards, along with the restart of the low doc, 3% down payments. Now we have many rentals locked up under a cartel and home prices rising at rates that far outstrip income growth. All the while, the Fed pretends there is no inflation and keeps changing benchmarks to show no inflation.
Creating another bubble in asset prices, including homes, and a nation of debt slaves was the master plan.
No worries for Boomers - Walmart greeters are up to $10 an hour!
I'm a boomer, two years shy of a comfortable pension, before I turn 60. Here's my advice to all the ass wipes behind me: Everyone for themself. If you're still arguing right/left politics, like most ZH'rs, you're a moron. If you're still playing by the rules, you're a fool. If you're guilty of both, you're poor. Good luck whipper snappers. You have little idea of lifes little pleasures that WON'T be coming your way.
You really think a pension will still be there? I am not counting on my Fed pension or SocSec long term.
Most ZH'ers are getting past the left/right BS. There is no savior on the political horizon so I will be content having The Donald for entertainment value.
Garbage in Garbage out. It took only a few million dollars for Zionists to turn American’s against Germany prior to WW1. Prior to this purposeful propaganda campaign, American’s were staunchly pro-German.
Money powers were in control the media and the aimed their money spigot also at presidents of universities (hence Woodrow Wilson). I don’t have the link handy, but I’ve posted the congressional record here on ZH before. Simply buying off editors of newspapers you don’t own, and spouting propaganda in those papers you do own, was all that was necessary to convert the population.
Radio stations also came under control. The inventor of FM detector circuit, Armstrong, committed suicide (or maybe he was murdered) because FM would have undermined the work of our Zionist/Tribal friends. Whole new radio stations would have come into being, and then they would have to be bought off. Armstrongs murder meant that he wouldn't have control over radio spectrum.
Since Bill Clinton’s telecommunication act, U.S. mass media has been consolidated into about 7 large companies. These companies have cross directorates, and do not report the real news – they are mouthpieces for financial oligarchy. They repeat what comes across the wires from news services.
A human mind is easy to dupe, especially if it only hears and sees one narrative. So, don’t blame previous generations, they were easily hypnotized. How many millennials have their nose stuck in old books and have the TV turned off?
The real root of the problem is money power. Money power is like an atom bomb in its strength, in that everybody has a price and can be bought off.
If one goes to the bank to take out a loan, a hypothecation event has occurred. Your signature authority has created new money as credit. Simultaneously a debt instrument was created; Said debt instrument DEMANDS usury for the right to create said credit.
Looking closer at the mechanism, most of the usury is paid up front. Only much later does the principle start decrementing. This means that bankers get first use of your credit (even though bankster’s claim it is their credit). The usury on the loan could be 2X or 3X. This is a tremendous gift for simply keyboard credit creation. It is good to be God on Earth.
Then and now, financial oligarchy has tried to own the world, and you are funding them. You fund them every time you hypothecate yourself.
Look in the mirror you who are blaming other generations. Are the former generations any more culpable than the latest? If anything, boomers and millenials have access to the internet, until it is shut down. On internet, there are people like me that tell you guys straight up how it works, and yet I still get little traction.
Many ZH denizens are blaming other generations for being dupes, yet nobody is identifying the real issue. That means the majority of us are dupes today as well.
The Press should be many companies, and there should be mandates in law to have at least two sides to an argument presented. In the old days, they at least tried to do that, but not so much today.
It is beyond obvious that if the press is owned by a single ethnic group, that practices ethnic in-group behaviors, and are closely allied with money power (credit creation), then news will be tilted. In fact, news will become a mouthpiece and propaganda organ. Today’s American press coined as “presstitute” by Gerald Celente, is not worth listening to, yet millions of sheeple do. They are then programmed and hypnotized, and money power funds this propaganda operation.
Stop funding your own dispossession. The money system could be changed overnight if enough people woke up, and demanded it.
www.sovereignmoney.eu