Thursday, March 24, 2022

This Cannot Be Sustained

Every now and then we see some milestone that gives us a vision of important portents on the horizon. Often we don't realize it until well afterward but here is one that we should all remember....



It wasn't many years ago, even since we bought our current home 11 years back, that a half million dollar house was considered pricey. Now it is just the average. I believe this is only for newly built homes but it is a sign of where housing prices are headed.

This means that for a new home buyer, assuming you can't write a check for a cool half mil, a mortgage looks like this using the Zillow calculator....


This assumes a 20% down payment of a hundred grand which is ridiculous. Even still, I have never in my life been in a place where I could reasonably swing a $2,608 monthly nut. You need at least an annual $31,000 in after tax income to just make that payment, not counting things like eating or utilities. Not to mention, who has $100,000 to slap on the counter as a down payment? A more realistic down payment, like $20,000, gives you this whopper of a monthly payment.

Over $3,300 every single month? GTFOH. Here is a personal example. In December of 2010 we purchased our home for $147,000. A nice price but it is way out in the country. 

Not quite doubled but around a 90% increase in "value" in just 11 years


You will own nothing and you'll be happy



A young White man in his early 20s has this to look forward to:

- Never owning a home

- Quite likely never getting married

- Working at some shit job for the rest of his natural days just to keep his head afloat

- A lifetime of being blamed for other people being terrible at life

- A steady diet of high fructose corn syrup laden foods, being fat and unhealthy

- The highlight of your day will be getting back to your pod after work, eating a microwave bug paste pizza, watching porn and playing video games. 

What a life you have to look forward to, leading what you know will be a lower quality of life than your parents and a much lower standard of living than your grandparents!

I am sure this won't lead to massive resentment and anger. Tens of millions of disenfranchised, hopeless young men won't be a problem at all. Maybe we can start a war to thin out the herd? Check out this incredibly poorly timed tweet from Selective Service.....


The replies to that tweet. Wow. Lots of borderline Fedpoasting that suggest attempting to conscript people in 2022 to go fight Russia would lead to a lot of bullets flying, making the NY draft riots during the Civil War look like a toddler's tea party. Here is my take: my boys will not go to war in the service of Globohomo and a country that hates them. No Russian ever called me a racist. Anyone trying to forcibly conscript my sons will discover that there are plenty of things I don't mind dying for. 

Anyway, with the average price of a new home crossing the half million dollar threshold, you can be sure that the feelings of hopelessness and a life with no real future are just getting stronger. Revolutions and civil wars start when the people no longer have anything to lose and dying in a rebellion is less frightening than living out your days in unbearable conditions. 

The storm is all around us and we are simply in a brief and temporary eye of the storm but that won't last much longer.


19 comments:

  1. Did you mean an annual income of $ 310,000 instead of 31,000? And on your current home, a 90% increase in one year seems high. Did you mean you bought your home in 2010 instead of 2020?

    Yeah, shit's fixin' to get real.

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  2. Depending on where you live, those look like rookie numbers. Wanna suffer sticker shock? Look up what those original tiny Levitt homes on a postage stamp of property on Long Island sell for today.

    Regarding life in modern-day America, I've said again and again, Don't get sick, don't get old. Sadly, now I have to add the additional caveat, Don't be young. The few young married couples we know who were able to "buy" a home on Long Island are all so deep underwater between their mortgage, obscene property taxes and staggering student loans that even two six-figure incomes are barely sufficient to survive. Forget about raising a family. Children today are a luxury that most simply cannot afford. This is where the light goes out on the White race if we don't change things.

    TBC

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    1. It is an average number but even out in rural Indiana prices are skyrocketing, I can't imagine trying to buy a place in a high rent zip code. White people want yards for their kids, non-Whites seem content to cram them into high rise apartments.

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    2. A lot ofthe ones in those tiny high rise slum towers are also living rent free because of you and me paying taxes.

      Exile1981

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  3. 500k is chump change out in my AO. A new townhouse development is going up a 1/2 mile from me, currently available is a 1bd/1ba,1,039 Sq. Ft. For $1,173,000. Should you be greedy and want a second bedroom for your spawn, 2bd/2.5ba, 1,626 Sq. Ft. For $1,903,000. Dont forget the monthly HOA fees on top of the mortgage! And these are townhouses, no yards and common walls between units. And one border of the property is a heavily congested highway. This whole house of cards can't crash and burn soon enough. But hey, the same development is putting in 50 "affordable" Senior Living units, so they are, you know, humanitarians and what not. /sarc

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  4. Under the Bush II years, things were similar. Oil went up and up. Housing went up and up. Inflation stats were falsified, but people were getting squeezed. A similar hopelessness of about home ownership was being felt. This continued right up until the bubble burst. The yearly averaged ratio of house price to median household income at the peak in 2006 was almost the same as it is today.
    Sources:
    https://fred.stlouisfed.org/series/MEHOINUSA646N
    https://fred.stlouisfed.org/series/USSTHPI

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    Replies
    1. That bubble bursting about took the whole thing down, if it happens again I am not sure they can stop it from getting out of hand.

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    2. I remember those years. Home prices climbed like crazy from 2000 to 2006.

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  5. The 40yr mortgage is something they are looking at now to get the monthly payment down.

    Foreigners (CHINA) are buying up US properties, should be illegal.

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    Replies
    1. And a 40 year mortgage turns home ownership into de facto renting because you will spend your entire working life trying to pay it off

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    2. I got a cold call last year from a real estate agent asking if I wanted to sell my house. I asked her who the buyer was and she straight-up told me it was a group of Chinese investors.

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  6. this is so youth have no way to achieve home ownership. destroy the family. best way is no ability to provide for them.
    and private property ownership us not allowed in communism.

    this is also part of the self perpetuating failure loop of no incentive to work.
    no wonder people are dropping out of the "world".
    the old one.

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  7. Older son gradually increased his salary since starting current job 15 months ago, and is now making about double what he used to (albeit working 50 hours a week minimum). But we are still helping him with a significant 4 digit monthly sum so he, wife, and our sole grandchild can live in a rented house in a decent neighborhood instead of an 850 sq ft apartment surrounded by diversity for upwards of $1600 a month, and so that grandson can be raised at home by mom instead of shunted off to daycare. It's why we currently own raw land with nothing on it - monthly expenditure is extremely costly but grandchild is our priority. Housing and rent prices in DFW are through the roof - non-stop influx of Han, pajeet, and CA immigrants so ever increasing demand.

    We got yet another form letter yesterday offering to buy our house - estimate $500 - $600 k. For a 1994 house in need of significant interior upgrades. Challenge is to sell when offer gets high enough that we can genuinely afford to leave husband's salary behind and before the bubble pops. We don't tend to be lucky, though, so we're not counting on a big payoff.

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  8. Japan has 100 year mortgages. Their society is much different from ours but the idea was that multi generations of a family would live in the home.
    We might need 100 year mortgages just to make the payment affordable.

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  9. These home prices are not sustainable. We are at the top of a bubble. The economy can't churn on without energy and resources, inflation will eat up the "free" money, and eventually the Fed will raise rates when inflation becomes unbearable. We will then have the recession of a lifetime.

    At the moment, at least in red states, people are building houses like there's no tomorrow. Here in eastern Tennessee, a developer just put in a rezoning application near me for something like 4500 new single family units. That's zero to fifteen thousand people in a couple of years. But that's at the expense of other parts of the country, and they are overbuilding like crazy.

    The problem is this. Housing prices are strongly correlated with population growth and population age. A country or region that experiences dropping growth and/or an aging population will suffer decreasing prices. A recent study in the Journal of Demographic Economics found that for every point of increase in population, housing prices tended to increase by 1.4 points. We are entering a time of recession, post inflationary collapse, aging population, and decreasing population growth. Remember what happened to housing prices in 2009? Like that, only more.

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  10. What can't go on forever, won't. Beware of the drop.

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