Do you find this purchasing pattern wasteful/unusual?

[Seasider]

You know, I agree with you about getting lucky, and that housing is a big issue.

 

But even with luck, there is a certain extent to which you can make your own. And one thing that can really enable making your luck is having a bit of savings for ready cash or to save as a down payment or to help secure a loan.

 

It's one thing when you are scraping by with not much possibility to save, which plenty of people are. But saving enough to be worthwhile would actually be easy for this writer - she could do it and still have a pretty nice lifestyle and lots of fun. She could easily put together enough to invest a worthwhile amount monthly for retirement, think later on about starting a business, move out of London at some point, take a sabbatical and write a book....

This is an excellent point. One may never be able to outright buy a house, but saving enough for a downpayment is not usually insurmountable.

[Katy]

I don't think that was the point at all.

 

It's when the market starts to demand these things, people who want to sell make the upgrades and tack the price on to the house. (though they rarely make it back.)  HGTV tends to make people think they really need that stuff.

 

This puts the cost of the house up and means fewer people can afford to buy.  It can begin to affect the whole housing market in some areas as people start to compete for the better off buyers.  Then the hoses that are left tend to be the really worse off ones - not just builder grade but ones with real problems or that have been trashed or are in very bad areas.

 

It ends up that there are no modest homes in the nicer areas.

 

I don't think there's a moral responsibility to not upgrade your house to keep values down.  Buying a home is an emotional decision. Some places you walk in and say, "Yes!" and others are a visceral "no!" and having things pretty means that more realtors will be excited to show your home and more buyers will submit a bid immediately.

 

I've been open about the fact that because DH's job moves us every few years, I choose an ugly house in the nicest neighborhood we can afford and do a slow flip.  By the time DH's job has been changed and we list the home, my goal is to have the prettiest house in that price range in that school district. Someone more practical might have taken the money I spent on paint and bathrooms and the deck at the last house and upgraded the HVAC to a more efficient system, but that wouldn't have created the bidding war that meant my home sold in less than 3 days for more than the asking price.   We chose that house for the things we couldn't change - location and gorgeous mature trees.

 

Also there is no longer an incentive to upgrade the practical things - because if that old furnace goes out, chances are the buyer is including a home warranty anyway.

 

Now there IS a moral responsibility to not spend money you don't have to upgrade your house.  We've bought more than one home that was overly upgraded in a short sale because the previous owners spent themselves into a hole, caused a bunch of financial stress, and then ended up getting divorced. At least that was the story the neighbors told us a few times.

Edited January 30, 2018 by Katy

[Scarlett]

I do think it is a real shame people can't stay in the area they were raised in and be able to afford to live.  However, life is full of tradeoffs like AM said.  I knew a couple born and raised in San Diego....He became disabled early in life....like mid -late30s....two teen daughters....so they up and moved to AR where the cost of living is pennies. Her sister had moved there... And they moved further out than I want to live.  They toughed it out for a couple of years but ended up moving back to SD and moving in with her mother.  They are soooooo happy to be home and I think they will never complain about living with her mom because they don't want to have to live SD.  

[Dmmetler]

We’re in a situation now where DH isn’t happy in his current job, but just about everything else in his particular sector is either urban West Coast or NYC. His salary right now is about at the industry average. Every time he looks at a job and we run the calculators, we’re looking at at least the equivalent of a 50% cut-for a job that may or may not actually be any better. Often it’s worse than that. It all comes down to the difference between a high COL area and a moderate one.

[dsmith]

I find it wasteful now, but I remember my first full-time somewhat decent paying job and I had about a year of spending in a similar way. I probably spent more on clothes than on eating out.

[fairfarmhand]

I read the article and one thing that sticks out to me is her "I want to live in the city." and "I'll never be able to buy a house."

 

Many families do relocate because they can't afford the house they want in the city. They make that choice. I'd like to live in a, but I can't afford it, so I'll live in b. 

 

The idea that it's not her fault that she can't buy a house because she chose to live in that city, that's kinda odd. 

 

So move.

 

If I were in her position, I'd just help her add up the numbers and while she doesn't have to live a spartan existence, she can still enjoy some of her luxuries while building up a nest egg. Whether it's for a house or retirement or whatever, she's selling out future joy for present day happiness. 

[Carol in Cal.]

We are looking at college towns like SLO, The Dunes/East Garrison area. We went to Mountain House to look and while the single family homes are lovely and big at Umbria, my husband’s company shuttle bus only goes to and from Dublin/Livermore. We want locations where if our kids need free lodging as adults, jobs (even if it’s just private tutoring) are still relatively easy to find.

 

Where I am staying now is really convenient for jobs so I am spoilt. I can easily get a job as a tutor too. We rather have a smaller place but higher employment prospects.

That sounds really sensible.  You're probably more likely to find good medical care in places like that, too.

[Arcadia]

We’re in a situation now where DH isn’t happy in his current job, but just about everything else in his particular sector is either urban West Coast or NYC. His salary right now is about at the industry average. Every time he looks at a job and we run the calculators, we’re looking at at least the equivalent of a 50% cut-for a job that may or may not actually be any better. Often it’s worse than that. It all comes down to the difference between a high COL area and a moderate one.

I just check salary.com and the maximum pay + bonus is lower than what my husband gets. Many tech companies pay bonuses in cash and RSUs (restricted stocks units). According to my husband’s W2, the RSU he received is about equal to his basic pay.

 

However with your daughter’s interest, I would be looking at tech jobs in Santa Cruz, Monterrey Bay where dereksurfs is than where I am. My location is good for people who wants to research salt marsh. His location is much better for marine life research and housing is less crazy. A new townhome there (not smack in the tourist area) is much more affordable than a condo where I am.

 

Reno would be at least a 67% pay cut (>$100k before tax) for us right now which makes paying for their online school a better deal than moving there if my kids are interested in DA.

 

We are feeling kind of trap by jobs too because only the bigger tech companies are willing to pay up for quality control related employees without worrying about sales and profits. His dept doesn’t generate any revenue and is a cost center. He went for an interview with Apple and is happy he didn't take their offer because of the iPhone mess right after the job offer came.

[Bluegoat]

I don't think there's a moral responsibility to not upgrade your house to keep values down.  Buying a home is an emotional decision. Some places you walk in and say, "Yes!" and others are a visceral "no!" and having things pretty means that more realtors will be excited to show your home and more buyers will submit a bid immediately.

 

I've been open about the fact that because DH's job moves us every few years, I choose an ugly house in the nicest neighborhood we can afford and do a slow flip.  By the time DH's job has been changed and we list the home, my goal is to have the prettiest house in that price range in that school district. Someone more practical might have taken the money I spent on paint and bathrooms and the deck at the last house and upgraded the HVAC to a more efficient system, but that wouldn't have created the bidding war that meant my home sold in less than 3 days for more than the asking price.   We chose that house for the things we couldn't change - location and gorgeous mature trees.

 

Also there is no longer an incentive to upgrade the practical things - because if that old furnace goes out, chances are the buyer is including a home warranty anyway.

 

Now there IS a moral responsibility to not spend money you don't have to upgrade your house.  We've bought more than one home that was overly upgraded in a short sale because the previous owners spent themselves into a hole, caused a bunch of financial stress, and then ended up getting divorced. At least that was the story the neighbors told us a few times.

 

I don't know that this comes down to some sort of moral individual issue.  No one has said "don't upgrade your house."  And I am sure no one thinks it is a bad idea to buy quality products or keep a home in good repair.

 

What people might think about is how shows like HGTV drive this kind of buying. How people used to be pretty content with a standard level of finish and now there is a content need to redecorate and keep up with trends. And often renovating perfectly good homes too, just for appearance, throwing out even new materials.

 

From a collective POV we might think how that impacts, say, the environment - this should be a big deal.  

 

We might think about who really benefits from this focus.

 

Now, a moral individual POV, being a Christian, my first thought is how this feeds into greed and envy, which were not included among the seven deadly sins for no reason.  That is a place for individuals to think about their moral health with regard to consumption, whatever capitalist individualism tells us about our "freedom" to buy.

 

It's hard to jump out of the economic system we happen to be in.  But I don't think that excuses us from thinking through that system and the part we are playing in it, and how that affects others besides ourselves.

[Carol in Cal.]

 

 

Now, a moral individual POV, being a Christian, my first thought is how this feeds into greed and envy, which were not included among the seven deadly sins for no reason.  That is a place for individuals to think about their moral health with regard to consumption, whatever capitalist individualism tells us about our "freedom" to buy.

 

It's hard to jump out of the economic system we happen to be in.  But I don't think that excuses us from thinking through that system and the part we are playing in it, and how that affects others besides ourselves.

Right.

 

It's similar to the tax law changes in the US recently--for those of us who can, I see them as a call to be more generous, because there is going to be a greater need in some ways.  Particularly the loss of the casualty loss deduction.

[Carol in Cal.]

 

We are feeling kind of trap by jobs too because only the bigger tech companies are willing to pay up for quality control related employees without worrying about sales and profits. His dept doesn’t generate any revenue and is a cost center. He went for an interview with Apple and is happy he didn't take their offer because of the iPhone mess right after the job offer came.

Does he know people who work for Apple?

I know several who do or did work there, and it's a very unique environment, from what I have heard.

Everyone I know like that either absolutely loves it and would hate working anywhere else, or absolutely hates it and leaves fairly quickly.  More than most places my impression is that it's crucial to embrace the culture there, and that the culture is pretty unusual.

[Scarlett]

I don't know that this comes down to some sort of moral individual issue.  No one has said "don't upgrade your house."  And I am sure no one thinks it is a bad idea to buy quality products or keep a home in good repair.

 

What people might think about is how shows like HGTV drive this kind of buying. How people used to be pretty content with a standard level of finish and now there is a content need to redecorate and keep up with trends. And often renovating perfectly good homes too, just for appearance, throwing out even new materials.

 

From a collective POV we might think how that impacts, say, the environment - this should be a big deal.  

 

We might think about who really benefits from this focus.

 

Now, a moral individual POV, being a Christian, my first thought is how this feeds into greed and envy, which were not included among the seven deadly sins for no reason.  That is a place for individuals to think about their moral health with regard to consumption, whatever capitalist individualism tells us about our "freedom" to buy.

 

It's hard to jump out of the economic system we happen to be in.  But I don't think that excuses us from thinking through that system and the part we are playing in it, and how that affects others besides ourselves.

 

 

Envy is the thief of Joy.  

 

I don't know how many times I have seen a HH episode where they walk into a perfectly nice kitchen (and I don't mean something from the 70s or even 80s....just think honey oak cabinets and white laminate counter tops) and turn their nose up 'ugh, this is a gut job!'.  It is laughable really.  

[Bluegoat]

Right.

 

It's similar to the tax law changes in the US recently--for those of us who can, I see them as a call to be more generous, because there is going to be a greater need in some ways.  Particularly the loss of the casualty loss deduction.

 

Yes.  And being generous tends to require moderating your own spending.

 

But even in terms of pure consumption and it's effect on our own perceptions.  Our culture and economy places a lot of emphasis on it and that tends to make it hard for us to see where we are in fact behaving abnormally.  In my experience it actually takes a lot of effort to wean ourselves off of taking all that consumption for granted, it's almost like weaning yourself off of a drug.  

 

With Lent coming up this is something that's been on my mind.

[Tsuga]

I think she misses The entire point that you can't buy an $350k property on a $35k salary. If you are young and single and making that money you can't afford to buy a place in the city. She could, though, buy a place in another setting. She also doesn't really seem to want a house. It seems to be a "poor me" piece.

 

I just want to point out that this is true, but it is not as if there is no trade-off to living far from the metro area where you work.

 

There is a real, tangible, every-day-quality-of-life and quantity of life trade-off when it comes to living in a small town, and that's a commute.

 

http://time.com/9912/10-things-your-commute-does-to-your-body/

 

https://www.express.co.uk/life-style/health/703132/Commuting-bad-health-shorten-life-new-report

 

It is true that you can't live right downtown or even in a central district on a journalist's salary. And it's true that for a single young person such as the woman in this article, you can save quite a bit just moving two or three tube stations down the line. However, housing is still insanely expensive there and almost certainly out of her reach.

 

To get savings, you need to go where fewer people are willing to live. Since living in a small town is not actually that bad, ask yourself, why wouldn't people want to live there? The answer is the commute. Three or four hours out of your day, 10-20% of your life, spent on public transport or in a car.

 

It's really frustrating to see people talk about this macro and microeconomic issue that is affecting the quality of life and financial security of millions, as if it were some kind of "simple trade-off" of "oh just move further out" "oh just drink less Starbucks". People are not that stupid. They are making rational choices, and if those choices seem strange it's because you don't understand the economic environment in which they are making them.

 

They are not seeing home ownership pay off for Generation X. They are not even seeing it pay of for many Boomers. They are seeing lifetimes of sacrifice erased in a day on the stock market, and people stuck with taxes they can't even pay. These stories make the news.

 

Maybe we could have policies about speculation on residential real estate. Maybe we could spend money on better transport making living in a smaller bedroom community not so detrimental to your health. Maybe we could have opportunities for service like Americorps and Peace Corps also linked to low-downpayment low-interest loans. Maybe we could take a hard look at why salaries are not rising with inflation and think about the policies that affect how businesses spend their money. Maybe we could have a real conversation about the fact that public policy affects people's lives and most people do what makes sense for them, and if people are all opting out of the real estate market, it's because it's not a market they will do well in because only people with a lot of excess capital can stay ahead of the market.

 

Not because they buy a cup of coffee. If you read stories of the depression, people do buy coffee and donuts on the street, even when they are not getting full meals at home. Wasteful? In a sense. Irrational, i.e. worth less than that money would be worth on real estate? I'm not sure about that.

 

Finally, again, even if everyone solved this for themselves, it wouldn't make housing affordable. The only way to get ahead is having more than others. So if you can somehow scrape together a more frugal lifestyle, living with your parents, getting into a very high salary (wouldn't the world just be perfect if there were no artists, teachers, arborists, nurses, only engineers and doctors?) early, you still won't be able to afford a house.

 

Because supply and demand governs that, so if everyone saved more, the prices would just go up, because the supply is increasingly inelastic around the world, and actually in some areas, such as Bangladesh and in certain places where they are running low on water, the supply is going down.

Edited January 30, 2018 by Tsuga

[Tsuga]

^ "you" above was meant to be universal and the whole post is not directed at MotherGoose.

[Bluegoat]

As with many things, it seems to me that there are often issues on both sides.

 

There are so many systematic questions about salaries, centralization of employment, and urbanization.

 

I personally have serious reservations about land as a commodity and the idea that prices can push people out of their ancestral neighbourhoods.

 

OTOH - people absolutely can sabotage themselves in terms of savings, or excuse themselves.  There are people who want to live in a place like London rather than their ancestral neighbourhood because they think it's more exciting and home is boring rather than because of needing to work there.  People do get caught up in buying stuff that is basically unnecessary (and they do it collectively too so some of those things become necessary) and that takes up economic capacity and resources.

 

You can't easily change people's behaviours without making systematic changes.  You also can't make systematic changes without people thinking about the implications of their individual behaviours.

 

Edited January 30, 2018 by Bluegoat

[Seasider]

People do get caught up in buying stuff that is basically unnecessary (and they do it collectively too so some of those things become necessary) and that takes up economic capacity and resources.

.

I think of this every time I pay the phone bill. Communications technology (acquisition and maintenance) is a huge item in the budget that wasn't there when I was a 20-something.

[Carol in Cal.]

I think of this every time I pay the phone bill. Communications technology (acquisition and maintenance) is a huge item in the budget that wasn't there when I was a 20-something.

It has been interesting to watch the switch over right on this board.

 

For a while, having cell phones at all was considered a non-frugal choice.  Then they became regarded as a necessity for job hunting, as in, how can you not have one and call yourself serious?  Then they became a crucial safety measure for children.  

[Bluegoat]

I think of this every time I pay the phone bill. Communications technology (acquisition and maintenance) is a huge item in the budget that wasn't there when I was a 20-something.

 

Yeah, my first year living away from home I didn't pay anything - I just used the pay phone at the end of my residence hall.  My second year in residence I sprang for a phone line, since I was i the attic with no pay phone I paid a small amount, though I was't happy about it even then.

 

Even considering inflation, I'd have never had the room in my budget for the expenses that people have now.

 

 

[Arcadia]

Does he know people who work for Apple?

I know several who do or did work there, and it's a very unique environment, from what I have heard.

Everyone I know like that either absolutely loves it and would hate working anywhere else, or absolutely hates it and leaves fairly quickly.

He knows current and former Apple employees. My ex-schoolmate works for Apple in sales. He would fall under the hate camp for the 1st job opening and the tolerable camp for the 2nd job opening. It is very dependent on which boss you report to and which dept you work for. There are a few push factors which makes us hesitate on the offer. His current employer has a bad rap but is a really nice company to work for. I don’t want to derail this thread and also don’t feel comfortable putting out too much info so we can discuss this offline.

Edited January 30, 2018 by Arcadia

[Crimson Wife]

 

 

I 'get it' when people say that buying a house is a good thing.  I really do.  I fully understand 'why' we 'should want to'. 

 

But that doesn't mean I actually want to.  Right now we are able to rent a house for less than half of what everything else in our town costs to rent.  Maybe right at half.  Our utilities are covered.  And things are still tight sometimes. 

 

The biggest reason to buy rather than keep renting is to stabilize your housing payment. Right now you are at the mercy of your landlord/lady. What happens if he/she decides to sell the house or move back in himself/herself? Or just raise your rent in line with market prices?

 

When we bought at the end of 2009, our mortgage was $250 more per month than the rent we had been paying. We were able to refinance to a 15 year mortgage in 2012 when rates dropped. Today rent on our old place would cost us a whopping $2k more than our mortgage. There's no way in H-E-double-hockey-sticks we could afford to pay that.

 

If you buy, you will be significantly less likely to find yourself forced to move because you can no longer afford the monthly payment. There's obviously things like unemployment or disability causing a drop in income, but in that case you'd hopefully at least get back the equity you've built up in your home. With renting, you're just building wealth for your landlord/lady.

[fairfarmhand]

Some of this might be that many young people are raised in a particular standard of living and don't get out of that circle a whole lot. 

 

I grew up in poverty. I consider that we live in a very nice home. But we are far from the nicest home in the nieghborhood. My kids' friend are all from similar economic backgrounds. And they have friends with nicer homes that we do. We're careful with money, but some of their friends families eat out multiple times a week and buy the expensive coffees etc. 

 

My kids are under the impression (because they know few people in poverty, know people with much more conspicuous consumption habits than ours) That we don't live in a place that's "All THAT nice." While I consider it a lovely place, the nicest I've ever lived in.

 

So I can see my kids, or those of our friends, growing up and taking for granted that everybody buys x, y, and z and owns a home, and has a certain standard of living. They don't see dining out and entertainment expenses as luxuries or optional. They just can't get their brains around, yes, your parents have provided this for you but THEY HAVEN'T ALWAYS LIVED LIKE THAT.

 

We are much more comfortable now than we were when we first got married, trying to get out of debt and take care of our baby on very little. But my kids don't remember that we started out in a tiny little rental, ate the same boring cheap food all the time, and never went to a movie or anything because we didn't have the money. 

 

So many kids forget that its okay to start out broke and if you're careful and work hard, you can work your way up to the house, the city you want to live in, the ability to have the expensive haircut, coffee, massage, fitness club. But I didn't have that when I was 25. I could afford it now if I wanted to but I don't.

 

Also, knowing how to put together delicious inexpensive meals is a skill that takes time to develop. Many people have never experienced tasty inexpensive homemade meals. To get GOOD food, they go out to dinner. My kids know that it's possible to have fabulous food for very little money if you're willing to cook a bit, so going out to dinner is a rare treat, mostly just because you get served and don't have to wash dishes!

[KungFuPanda]

As the parent of a kid with severe asthma...

 

 

What percentage of the home buying population is ACTUALLY rejecting homes with carpet.

 

What percentage of allergy and asthma suffers that aren't buying homes are actually rejecting apartment RENTALS due to carpet?

 

I don't think allergy sufferers hold enough of an impact on the market.

 

 

For the record though, the home we sold was not carpet throughout. There was some carpet, which yes, was brand new, but much of the flooring was brand new linoleum or laminate flooring. Not as fancy as hardwood but not the allergy issue that carpet is.

People have much different standards for what they rent vs what they buy. Even if the allergy buyers are a small percentage, the general public is moving away from carpeting and valuing quality flooring more and more. It doesn’t indicate a foolish population to see why MANY people would choose a few extra dollars a month tacked onto their mortgage to avoid all the hassle and disruption of updating the floors later. It’s like moving again to update floors.

 

Also there could be the general perception that if the owners cheaper out on floors and finishes, what else did they fix the cheapest way possible. I get it. I say this as a person who has Formica, a white fridge, and vinyl plank flooring (that I recently did myself because of disability equipment). I think it’s very easy to see why those things would make it easier to sell a house. The proof is the original story. Most people care a lot about how their house looks and how it looks to other people. I don’t have that in me, but it’s not hard to understand.

[BarbecueMom]

 

 

To get savings, you need to go where fewer people are willing to live. Since living in a small town is not actually that bad, ask yourself, why wouldn't people want to live there? The answer is the commute. Three or four hours out of your day, 10-20% of your life, spent on public transport or in a car.

 

 

DH works downtown (midwest city), and from the time he texts me to let me know he's leaving his desk until the time he pulls in the driveway is 35 minutes.  And we don't even live in the inner-ring suburbs, by choice.   Trust me, we're all happier with his 35 minutes of decompression time between can't-stop-talking coworkers/meetings and can't-stop-talking kids.  But I don't know anyone here with 3-4 hours of daily commuting, even if they live out in "the sticks".

 

There's this strange idea that you can't find a job that pays more than $40K a year in the midwest, and you have to move to the coasts to get anywhere salary-wise.  If you want to live in SF or NYC or Seattle for all the non-monetary benefits, that's fine and worth the trade offs for many people, but generally the alternative isn't starving in the midwest or spending hours a day on the road.  You can have a nice house and a six figure salary and a decent commute and savings and even some fun money.  You'll just have to take a plane to get to the ocean.

 

(I don't know how things are in the UK.  Maybe London really is job central, I don't know.)

[LucyStoner]

I don’t understand the idea that 20 somethings are never going to be able to buy a house. I really think what they mean is, “I’m not willing to do what it would take for me to be able to buy a house.†And I think that is a perfectly fine choice. But it is a choice.

I’m 37. We got into and out of the real estate market at the wrong times. We got out due to circumsances beyond our control.

 

Even with a down payment, we need to market to decline to be able to buy here again and that time it surely won’t be in the city limits. Why? High prices, moderate income with earnings and earning potential lowered due to circumstance. When we first bought, we had two incomes and 1 preschooler. Now we have 2 special needs kids and I can’t work FT and meet their needs. We also have 3 other people living with us but let’s pretend we didn’t and we could buy a very small house.

 

A 20% downpayment on a small three bedroom fixer in a not great area with a commute is almost what a whole house costs in a lot of the places my friends are moving to.

 

I’m ok not buying a house now or even ever if that’s how it works out. But it’s absolutely not because we are frivolous.

 

My same age friends and younger friends who are engineers and doctors are buying houses that originally were priced for bus drivers and factory workers. My same age and younger friends who are teachers and journalists are not buying houses. The factory workers I know are living in rooms, not apartments. Every month another single high income family or double moderate income family we know relocates out of state.

 

We definitely considered relocating out of state but we chose to stay in this area so that our son could access the elite high school that had been his dream for a long time. Besides that factor, there is my elderly father, our extended family who we help support in different ways and the not small matter of finding autism services wherever we might move. I own our choice not to move at this time and we are considering still moving at some point after my son is done with high school.

 

That said, when people local to me who bought their homes 20 years ago want to give me homebuying advice, it usually boils down to no more avocado toast and I’m like, I’m already eating refrigerated oatmeal on the go dudes.

Edited January 30, 2018 by LucyStoner

[Scarlett]

DH works downtown (midwest city), and from the time he texts me to let me know he's leaving his desk until the time he pulls in the driveway is 35 minutes.  And we don't even live in the inner-ring suburbs, by choice.   Trust me, we're all happier with his 35 minutes of decompression time between can't-stop-talking coworkers/meetings and can't-stop-talking kids.  But I don't know anyone here with 3-4 hours of daily commuting, even if they live out in "the sticks".

 

There's this strange idea that you can't find a job that pays more than $40K a year in the midwest, and you have to move to the coasts to get anywhere salary-wise.  If you want to live in SF or NYC or Seattle for all the non-monetary benefits, that's fine and worth the trade offs for many people, but generally the alternative isn't starving in the midwest or spending hours a day on the road.  You can have a nice house and a six figure salary and a decent commute and savings and even some fun money.  You'll just have to take a plane to get to the ocean.

 

(I don't know how things are in the UK.  Maybe London really is job central, I don't know.)

 

Dh works downtown in the city and his current commute is 55 minutes.  He doesn't seem to mind it, but we are planning to move into 'town' which will put him about 15 minutes closer.  When he lived in CA he said he was commuting up to 4 hours per day at times.  No wonder he doesn't mind 55 minutes.

[Laura Corin]

 

 

(I don't know how things are in the UK. Maybe London really is job central, I don't know.)

London accounts for about one third of the UK's output, more in some industries like journalism. You can mostly walk almost as fast as you can drive in central London at rush hour, so 35 minutes would still find you in central London. There are no freeways close to the centre.

[shawthorne44]

Some of this might be that many young people are raised in a particular standard of living and don't get out of that circle a whole lot. ...

 

 

I will never forget talking to a 17-year-old in my parent's neighborhood, where I grew up.  I had just bought a house and I was driving my old car.  The AC had gone out on my car while I was closing on the house.  The plan was to replace the car, but after the house closed.   I closed in winter so no AC wasn't a big problem even in Texas.  The 17-year-old said that she'd rather not have a car, which she didn't, "then drive anything but a Lexus."    I thought that was a very snotty thing to say to someone with an admittedly crappy car.   I told her, "You are going to have a hard life."    Her mom had a similar attitude and did drive a Lexus.  Her mom was a single mom who had one of the job's where the salary is basically public knowledge.  The mom didn't make that much money.  

[LucyStoner]

If you want to live in SF or NYC or Seattle for all the non-monetary benefits, that's fine and worth the trade offs for many people, but generally the alternative isn't starving in the midwest or spending hours a day on the road.

For a lot of people, these expensive cities are their homes not places they live for the fringe benefits. Over the 16 years of my marriage, we have seriously explored relocating away from this pricey west coast metro area more than a few times. Parts of the Midwest have been high on our list. But the disruption to our family would be a large cost, something that we have to weigh against the lower real estate costs. We are ready to pull the trigger and started, in fall 2016, to tentatively plan a move for 2017 but it was with the caveat about the high school and then he got in (which involved not just a competitive application screen but a random lottery so we had no way of knowing what would happen until after the lottery).

 

35 minutes is often how long it takes for me to get to the express lanes from my son’s school. Then it’s another 30 minutes home and I consider 65 minutes to be a good day on the afternoon commute. (Bear in mind, that’s just the part that involves him being in the car, I’ve often already encountered a total standstill on the way to get him. I live in my van. 🤣)

Edited January 30, 2018 by LucyStoner

[Arcadia]

London accounts for about one third of the UK's output, more in some industries like journalism. You can mostly walk almost as fast as you can drive in central London at rush hour, so 35 minutes would still find you in central London. There are no freeways close to the centre.

.

 

A UK friend works for an investment bank from home but she has worked for that bank in that job for more than a decade. As a single in UK twenty years ago she could not have afford a home just outside London. Now they are a double income family with two school age kids and they bought near her husband’s parents which is another factor for choosing that location. They wanted to be near enough to help easily if needed. She has other siblings but I think her husband is an only child and grew up in London.

 

My friend would probably have spent similar amounts in her twenties in London and she is from an upper middle income family. It’s the pamper yourself a little before the serious dating and marrying phase. She didn’t have student debt though.

Another friend went to UK for college and decided to settle there. She too have no student debt and a few years of “wasteful†spending after college before saving for a home. She is in her 40s, has a lovely townhome now in the outskirts, dual income and two kids.

[MotherGoose]

I just want to point out that this is true, but it is not as if there is no trade-off to living far from the metro area where you work.

 

There is a real, tangible, every-day-quality-of-life and quantity of life trade-off when it comes to living in a small town, and that's a commute.

 

http://time.com/9912/10-things-your-commute-does-to-your-body/

 

https://www.express.co.uk/life-style/health/703132/Commuting-bad-health-shorten-life-new-report

 

It is true that you can't live right downtown or even in a central district on a journalist's salary. And it's true that for a single young person such as the woman in this article, you can save quite a bit just moving two or three tube stations down the line. However, housing is still insanely expensive there and almost certainly out of her reach.

 

To get savings, you need to go where fewer people are willing to live. Since living in a small town is not actually that bad, ask yourself, why wouldn't people want to live there? The answer is the commute. Three or four hours out of your day, 10-20% of your life, spent on public transport or in a car.

 

It's really frustrating to see people talk about this macro and microeconomic issue that is affecting the quality of life and financial security of millions, as if it were some kind of "simple trade-off" of "oh just move further out" "oh just drink less Starbucks". People are not that stupid. They are making rational choices, and if those choices seem strange it's because you don't understand the economic environment in which they are making them.

 

They are not seeing home ownership pay off for Generation X. They are not even seeing it pay of for many Boomers. They are seeing lifetimes of sacrifice erased in a day on the stock market, and people stuck with taxes they can't even pay. These stories make the news.

 

Maybe we could have policies about speculation on residential real estate. Maybe we could spend money on better transport making living in a smaller bedroom community not so detrimental to your health. Maybe we could have opportunities for service like Americorps and Peace Corps also linked to low-downpayment low-interest loans. Maybe we could take a hard look at why salaries are not rising with inflation and think about the policies that affect how businesses spend their money. Maybe we could have a real conversation about the fact that public policy affects people's lives and most people do what makes sense for them, and if people are all opting out of the real estate market, it's because it's not a market they will do well in because only people with a lot of excess capital can stay ahead of the market.

 

Not because they buy a cup of coffee. If you read stories of the depression, people do buy coffee and donuts on the street, even when they are not getting full meals at home. Wasteful? In a sense. Irrational, i.e. worth less than that money would be worth on real estate? I'm not sure about that.

 

Finally, again, even if everyone solved this for themselves, it wouldn't make housing affordable. The only way to get ahead is having more than others. So if you can somehow scrape together a more frugal lifestyle, living with your parents, getting into a very high salary (wouldn't the world just be perfect if there were no artists, teachers, arborists, nurses, only engineers and doctors?) early, you still won't be able to afford a house.

 

Because supply and demand governs that, so if everyone saved more, the prices would just go up, because the supply is increasingly inelastic around the world, and actually in some areas, such as Bangladesh and in certain places where they are running low on water, the supply is going down.

I understand what you are saying to an extent. I do think the author of the article has an extreme view of things and could possibly work out things much better than she's describing in the article. It appears that she wants to Live downtown and since she can't afford to buy a house downtown, which is a completely unrealistic goal anyway for someone making that salary, she has decided that homeownership is not going to happen. As Laura mentioned, the cost of public transport for commuting is high, but then if she takes public transport does she have to have the expense of a car? I certainly don't know London or England real estate either or the commute times to get to an affordable area.

 

In my state, which is obviously not London, nor is the state or region known for any big cities like London, it is possible to have a perfectly adequate house right outside of downtown on a salary like this persons. I guess that housing inflation has not hit most parts of the state. There are some areas that are expensive, but anyone wanting to work in city could find housing with a realistic commute (1/2 hour).

[LucyStoner]

I feel for you. And it sounds like you and your family gave it a lot of thought and planning, so no avocado and toast advice here. You need the high school and have family to care for, but buying in your location isn’t a great choice and you can’t leave right now. It happens! Are home prices in your area pretty inflated?

 

I think there will be a “market correction†🤣 in the lower cost suburbs. I think the city proper and the most desirable eastside suburbs are unlikely to decline, they will probably see a slower rate of growth at some point. Like in SF, the market crashed elsewhere but in SF prices just flatlined for a few years. That’s how it will now be in the city limits.

[Seeking Squirrels]

Wasteful, maybe. Unusual, no I don't think so. She's in a different phase of life than the majority of us here. How she spends would be irresponsible for someone with a family, kids, house..... unless they were wealthy enough for that to not impact budget at all. She is single. It isn't realistic to expect her to come home from work each day to eat and spend an evening alone. Going out with friends frequently makes sense for someone single, especially if she ever wants to meet someone. You don't meet many new people sitting home alone. Saving is important, but so is living. 

 

So could she save more? Absolutely. SHOULD she save more? That would entirely depend on her priorities and what of those things she actually enjoys vs what is habit and could be changed without impacting her quality and enjoyment of life. 

[Laura Corin]

I think that housing policy is the missing aspect in the talk about London. The city is surrounded by a Green Belt of land on which it is illegal to build. The city doesn't just fade out, or merge into the next town. It stops dead. Most people appreciate the environment that this creates. Londoners can get on a train and go for a pub lunch in a picturesque village surrounded by green fields. But they pay a price in inflated House prices.

 

https://en.m.wikipedia.org/wiki/Green_belt

[BarbecueMom]

For a lot of people, these expensive cities are their homes not places they live for the fringe benefits. Over the 16 years of my marriage, we have seriously explored relocating away from this pricey west coast metro area more than a few times. Parts of the Midwest have been high on our list. But the disruption to our family would be a large cost, something that we have to weigh against the lower real estate costs.

 

35 minutes is often how long it takes for me to get to the express lanes from my son’s school. Then it’s another 30 minutes home and I consider 65 minutes to be a good day on the afternoon commute.

 

I know, and I agree that being near family or an existing social network is a darn good reason to live in those HCOL areas.  Or having a very specialized job.  Or needing access to very specific healthcare or education resources.  I was more referring to people (especially new grads) that move out there with the intention of "striking it rich" and believe that you can't survive with a decent job in the Midwest.  Silicon Valley or bust.  I wonder if that's a first-gen college student thing as well.   I know DH had no idea about the depth and breadth of his career field until he'd already graduated and found a job.

 

On one hand, that commute sounds crazy.  On another, being able to listen to more than snippets of an audiobook in the car before it's time to get out sounds intriguing!

[LucyStoner]

I think that housing policy is the missing aspect in the talk about London. The city is surrounded by a Green Belt of land on which it is illegal to build. The city doesn't just fade out, or merge into the next town. It stops dead. Most people appreciate the environment that this creates. Londoners can get on a train and go for a pub lunch in a picturesque village surrounded by green fields. But they pay a price in inflated House prices.

 

https://en.m.wikipedia.org/wiki/Green_belt

Zoning absolutely affects prices here too. The people who bought their SFH before the boom tend to lobby hard against higher density housing coming into their areas but when we have people moving here at a brisk clip, there’s no where for them affordable to buy unless they are of considerable means.

[fairfarmhand]

Also, she's a journalist. There's a mindset that's fed to young people now to "Do what you love and the money will come." Which isn't always the case. Some careers just don't pay well. Which is fine if that's your passion, but you do need to go into that field knowing  "I'd rather enjoy my job than own a home." 

 

Young people sometimes don't consider that they could enjoy a job in a slightly different field (In other words it's not their dream job, but it's okay) and earn a little more money. Every job isn't going to be the perfect situation. 

 

I do feel that it's sad that so many young people trust their advisors who tell them this stuff and end up stuck in low paying fields because their degree doensnt translate to a different line of work very well.

[LucyStoner]

I know, and I agree that being near family or an existing social network is a darn good reason to live in those HCOL areas. Or having a very specialized job. Or needing access to very specific healthcare or education resources. I was more referring to people (especially new grads) that move out there with the intention of "striking it rich" and believe that you can't survive with a decent job in the Midwest. Silicon Valley or bust. I wonder if that's a first-gen college student thing as well. I know DH had no idea about the depth and breadth of his career field until he'd already graduated and found a job.

 

On one hand, that commute sounds crazy. On another, being able to listen to more than snippets of an audiobook in the car before it's time to get out sounds intriguing!

The commute is going to kill me. I’d tell him to get the bus (which would take roughly 1.5 hours each way) but he needs the scaffolding and support he gets from us right before and right after school.

 

Upside, I am definitely very up on news, podcasts and audiobooks. 🤣

 

There are families with longer commutes than ours. We have a carpool- I drive MWF, they drive TTh and chip in on gas.

 

We are plotting a move. Before we went from 4-7 people we were hoping it would be a 3 bedroom house we bought. Now, it’s going to be, at least initially, a 5 bedroom rental. We will pay more, but less gas so that won’t be a problem budget wise. 5 bedrooom rental will get my brother off my couch and let the teen and tween have their own rooms. It will also take us from 2 to 3 bathrooms which is nothing to sneeze at.

Edited January 30, 2018 by LucyStoner

[LucyStoner]

Also, she's a journalist. There's a mindset that's fed to young people now to "Do what you love and the money will come." Which isn't always the case. Some careers just don't pay well. Which is fine if that's your passion, but you do need to go into that field knowing "I'd rather enjoy my job than own a home."

 

Young people sometimes don't consider that they could enjoy a job in a slightly different field (In other words it's not their dream job, but it's okay) and earn a little more money. Every job isn't going to be the perfect situation.

 

I do feel that it's sad that so many young people trust their advisors who tell them this stuff and end up stuck in low paying fields because their degree doensnt translate to a different line of work very well.

But not every journalist is cut out for engineering or nursing. Someone is going to walk dogs, wait tables, drive a forklift and write newspaper articles.

 

I have a friend who is a journalist. He’s now the editor of a weekly publication. He makes around what a starting teacher would, so here that’s about 45k. Yes, he could make more than he does (even with his degree) but this is what he’s good at at his kids are fed so I don’t really see an issue. He is married, and not to an engineer or a pharmacist but to a teacher. They have a small family and they get by.

[Arcadia]

Zoning absolutely affects prices here too. The people who bought their SFH before the boom tend to lobby hard against higher density housing coming into their areas but when we have people moving here at a brisk clip, there’s no where for them affordable to buy unless they are of considerable means.

It’s a chicken and egg problem though. My area is a master plan high dense area and the infrastructure is able to cope with it except on days when there is a NFL match. Nearby schools have to add portable classrooms on basketball courts and parking lots to cope with overcrowding.

 

We have seen areas where high dense service apartments and condos are built with no improvement to infrastructure like roads and schools. Not surprising that people would have a NIMBY opinion. My area can’t support more high dense residential without significant infrastructure improvements but it’s certainly better equip to handle high dense residential buildings than other nearby areas.

[fairfarmhand]

But not every journalist is cut out for engineering or nursing. Someone is going to walk dogs, wait tables, drive a forklift and write newspaper articles.

 

I have a friend who is a journalist. He’s now the editor of a weekly publication. He makes around what a starting teacher would, so here that’s about 45k. Yes, he could make more than he does (even with his degree) but this is what he’s good at at his kids are fed so I don’t really see an issue. He is married, and not to an engineer or a pharmacist but to a teacher. They have a small family and they get by.

Totally. That’s fine. But finanscial expectations have to be in line with reality. My point is that If you choose a lower paying field there are decisions that must be made about your financial life. If your friend and his wife both eat out 5 of 7 days and buy the pricey coffee and have other expensive habits, it will affect their lifestyles. That’s all I’m saying.

 

If a parent is a doctor, lawyer, whatever high paying career and the child chooses to be a teacher it’s going to be a different lifestyle than what they grew up experiencing. Some young people struggle with that more than others.

 

 

Sent from my iPhone using Tapatalk

Edited January 30, 2018 by fairfarmhand

[Bluegoat]

I think that housing policy is the missing aspect in the talk about London. The city is surrounded by a Green Belt of land on which it is illegal to build. The city doesn't just fade out, or merge into the next town. It stops dead. Most people appreciate the environment that this creates. Londoners can get on a train and go for a pub lunch in a picturesque village surrounded by green fields. But they pay a price in inflated House prices.

 

https://en.m.wikipedia.org/wiki/Green_belt

 

But limited growth would not be a problem if more people didn't want to live there.  There are a number of very good reasons to avoid having mega-cities spreading over more and more landscape.

 

Which to me raises the question of why more and more economic activity is centred there, sucking it out of other cities.  A certain amount of centralization is driven economically, but it actually seems well beyond that and to the point of being detrimental to the rest of the country.

[Bluegoat]

Also, she's a journalist. There's a mindset that's fed to young people now to "Do what you love and the money will come." Which isn't always the case. Some careers just don't pay well. Which is fine if that's your passion, but you do need to go into that field knowing  "I'd rather enjoy my job than own a home." 

 

Young people sometimes don't consider that they could enjoy a job in a slightly different field (In other words it's not their dream job, but it's okay) and earn a little more money. Every job isn't going to be the perfect situation. 

 

I do feel that it's sad that so many young people trust their advisors who tell them this stuff and end up stuck in low paying fields because their degree doensnt translate to a different line of work very well.

 

That happens sometimes, but she's actually making a median income and writing for a major international paper.  That's not too shabby.

 

If we forget she is 26 - she is living a little luxuriously in some ways, and not saving enough.  But she is single, no kids, and has a roommate so her rent is shared.  She's a professional with an average income.

 

London still needs bus drivers, waiters, and all those other people who make a city run, they all need places to live, and presumably many others will have spouses, kids, and so on.  

 

In a city that size, you kind of wonder where they live when more and more of the city is converted into housing only the well off can afford.  There is something a little perverse about a city that hasn't housing for the people who actually work in it.

[LucyStoner]

That happens sometimes, but she's actually making a median income and writing for a major international paper. That's not too shabby.

 

If we forget she is 26 - she is living a little luxuriously in some ways, and not saving enough. But she is single, no kids, and has a roommate so her rent is shared. She's a professional with an average income.

 

London still needs bus drivers, waiters, and all those other people who make a city run, they all need places to live, and presumably many others will have spouses, kids, and so on.

 

In a city that size, you kind of wonder where they live when more and more of the city is converted into housing only the well off can afford. There is something a little perverse about a city that hasn't housing for the people who actually work in it.

Exactly. I’m more concerned about the situation of a cleaning lady married to a bus driver who are making about that much combined and have kids. Where do they live? Here, they are living either really far away or in housing that most people would not consider workable for a family or they might be doubled up with another family unless they can get some form of (difficult to access, long waiting list to get) rental assistance. The economy needs to work for people who aren’t just in the professional class. Edited January 30, 2018 by LucyStoner

[Scarlett]

But not every journalist is cut out for engineering or nursing. Someone is going to walk dogs, wait tables, drive a forklift and write newspaper articles.

 

I have a friend who is a journalist. He’s now the editor of a weekly publication. He makes around what a starting teacher would, so here that’s about 45k. Yes, he could make more than he does (even with his degree) but this is what he’s good at at his kids are fed so I don’t really see an issue. He is married, and not to an engineer or a pharmacist but to a teacher. They have a small family and they get by.

 

 

So are you staying in that area or looking to move to a lower COL area?  Oops wrong post but oh well.  LOL

Edited January 30, 2018 by Scarlett

[LucyStoner]

So are you staying in that area or looking to move to a lower COL area? Oops wrong post but oh well. LOL

Moving means:

 

-Taking my son out of a unique high school he worked towards for years.

-having to find new autism providers for two sons.

-leaving my elderly, disabled father here or moving him with us. I want to help him but prefer to help at the distance of “he lives over there and we live here†and not “my dad lives with usâ€.

-Leaving my disabled brother and his daughters who live with us but can’t move due to a divorce.

-leaving my niece and nephew who depend on us for a myriad of educational and other support.

-immediately reducing my earnings, because my rates are a function of my reputation. I don’t need to look very hard for business here. It finds me. I’m at a point in my life where well paid periodic PT work finding me is a big benefit. If my caregiving obligations to my boys were less, I could build up a business in a new location but they are not. And they aren’t going away. I thought “when I can put them back in school†I’d be able to work more. Um, nope. Not really. I’ve reached a point where I am accepting that taking care of these kids will be my FT occupation for the foreseeable future. There’s not magic puzzle piece that will fall in place and allow me to work FT.

-moving away from the job connections my husband has intentionally developed here.

 

I’d rather rent here than own a house in Minnesota at the cost of walking away from all of those factors. If it were a matter of survival, sure we would move. But I don’t mind renting here. It’s a good life. Not perfectly ideal, but what is?

Edited January 30, 2018 by LucyStoner

[Scarlett]

Moving means:

 

-Taking my son out of a unique high school he worked towards for years.

-having to find new autism providers for two sons.

-leaving my elderly, disabled father here or moving him with us. I want to help him but prefer to help at the distance of “he lives over there and we live here†and not “my dad lives with usâ€.

-Leaving my disabled brother and his daughters who live with us but can’t move due to a divorce.

-leaving my niece and nephew who depend on us for a myriad of educational and other support.

-immediately reducing my earnings, because my rates are a function of my reputation. I don’t need to look very hard for business here. It finds me. I’m at a point in my life where well paid PT work finding me is a big benefit.

-moving away from the job connections my husband has intentionally developed here.

 

I’d rather rent than own a house in Minnesota at the cost of walking away from all of those factors. If it were a matter of survival, sure we would move. But I don’t mind renting here. It’s a good life. Not perfectly ideal, but what is?

 

 

Right.​ â€‹I doubt I would move away either in those circumstances.  You mentioned you were moving to a bigger house and I was just curious if that meant leaving the area.  

[LucyStoner]

Right.​ ​I doubt I would move away either in those circumstances. You mentioned you were moving to a bigger house and I was just curious if that meant leaving the area.

We are moving from a north suburb to a south one. One I never imagined I’d live in but, we do for our kids, right? We will still be in a same metro area. Without traffic, we are actually moving only about 35 minutes away but the reality is that it’s more like 1.5 hours away during the day.

 

The zip code we live now is very affluent. The zip code there is not at all. But the location is perfect for our circumstances. It will cut the school commute for my older son down considerably. Our rent will increase by 87% with the move but that is offset by way less gas and my brother will start paying part of the rent there. Right now, our gasoline outlay is almost to the point of eclipsing our food costs.

 

The move has some big costs for my younget son and a smaller cost for my husband but is a big net gain for the rest of us + has positives for all 7 of us. So. Trade offs.

Edited January 30, 2018 by LucyStoner

[Ausmumof3]

I'm very grateful we were frugal when we were young and energetic.

 

These days my life is so busy and I have so many people to take care of it is a lot harder.

 

We were real penny pinchers for the first seven years or so of our marriage and the money that is now equity in a house and paid off student loans is serving us well.

We were the same. Can't imagine trying to raise kids without having that ... it's hard enough as it is!

[Bluegoat]

Exactly. I’m more concerned about the situation of a cleaning lady married to a bus driver who are making about that much combined and have kids. Where do they live? Here, they are living either really far away or in housing that most people would not consider workable for a family or they might be doubled up with another family unless they can get some form of (difficult to access, long waiting list to get) rental assistance. The economy needs to work for people who aren’t just in the professional class.

 

Yes.

 

So long as we want bus drivers and cleaning ladies, it makes no sense to say those people should all choose higher paying jobs.  London doesn't need 8 million bankers or doctors or professional of any kind.  No cities do.  If somehow everyone had the qualifications, there would still be no jobs for them, but there would be for bus drivers.  So, now your bus driver is also an accountant - not really an efficient way to run a society.

 

Moving might make sense for some of those people but that is a band-aid for a few, it doesn't address the underlying issue.  If everyone is moving to London, that's where most of the busses will be.

Edited January 30, 2018 by Bluegoat