Houses

Buying a house used to be the first step towards long-term wealth.

Now it’s a loser’s game.

Houses are no longer reliable as investments. Millions of Boomers are putting their McMansions on the market with no takers. Younger generations don’t need (few marriages or kids) or want a huge money pit and can’t afford it anyway. Many who did manage to rid themselves of their monstrosities moved to Florida in time for a chance to buy high, now trying to sell at any price and be stuck waiting for the next hurricane with canceled insurance. High interest rates, crazy increasing insurance and property taxes, costly repairs can trap you into debt poverty for life.

Of course apartments suck. Noisy neighbors and thin cheap walls can make you crazy. Rent goes up every lease renewal. Just enough to keep you trapped given the expense of moving again and why bother since rents are high everywhere. Especially for so-called luxury apartments that looked good on paper but you find out the gym is a joke and the pool is filthy.

Owning a house wrecks your mobility. You can get a job offer but can’t take it because you are stuck. With real estate broker commissions and closing costs you are underwater. You have to come up with thousands of dollars to exit. The next house will likely be more expensive, have hidden expensive defects and a higher interest rate.

Fewer people (just like you) can afford a median priced house. If you buy one and prices stay high or go up, who are you going to sell it to if you need to move?

Theoretically you can buy a fixer upper to get in cheap, improve and build equity. You will find yourself bidding against countless other dreamers so the deals will not be there. Do you know how to remodel? If not hiring it out will negate any upside when you sell. And of course there are more fees and closing costs. They you still need a place to live.

You will carry that weight all your life…