Homeownership in America is just renting on steroids.

This is why the whiny left-wing arguments about how people who can reliably pay rent should be able to get a mortgage are not that ridiculous.  In practice people have completely abandoned the idea of staying in a house for decades and they’ve abandoned that idea for decades.  And yeah, the Boomers started it, with their tiny starter homes and then a bigger one to raise kids in and then the comfortable home for entertaining.  That’s three right there.

So many people do sell frequently that it’s just a special, perks-laden version of renting where you even get access to massive amounts of consumer credit and tax breaks, but you’re totally leaving in three or four years.

Argh.

 

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29 thoughts on “Homeownership in America is just renting on steroids.

  1. Well yeah. It isn’t pleasant raising a bunch of kids in a tiny starter home but most people can’t afford their “forever home” right away. In a lot of places owning is a lot cheaper than renting, so if you don’t buy the starter home you won’t be able to afford the family home later either.

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    • You’re merely illustrating my point. If owning for 5 years is cheaper than renting, and people aren’t planning to “own” (amplified rent) through 2 or 3 or 5 homes in their lifetime, then what was created was an artificial superclass of renters who don’t stay anchored in the community or even maintain their housing, but can rent more cheaply than those with rental-only housing contracts and in addition borrow hundreds of thousands of dollars against their rental.

      Real ownership incentive and real ownership would be tax abatement with 15 years owner-only occupancy or something along those lines.

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      • I don’t disagree with you, I’m just not sure how people will get off this particular treadmill.

        BTW- I’m from an area with a large military population. They also tend to buy houses and then leave in 3-5 years. The military is heavily subsidized of course so they drive up housing pricing for civilians. It’s a more extreme version of what happens everywhere else.

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  2. I suspect that this is very bifurcated.

    My grandparents lived in a small family cottage while building a large new house on the family homestead 60 years ago. My parents built a house 30+ years ago and still live in it. My sis owns both our great-grandma’s house and a suburban McMansion that they bought during the housing bust as a short sale (their timing was fabulous). Brother was in the military and I believe they bought their first home in the last couple years (brother is early 30s, but has 3 kids now). We are early/mid-40s and living in our first home, bought 4 years ago. It took that long to Dave Ramsey our way into our first home (husband was 40 and we had three kids when we finally bought), but like sis, we also bought at the bottom of the market. I don’t know if the house will always be right for us (it’s very large and two story), but husband hates moving and wants to stay as long as possible and likes the idea of having this much space for adult kids and grandkids.

    Meanwhile, on the other side, we have the older relatives who have had 3 homes over the last 20 years, and seem to do a $200k renovation every time they move (as ridiculous as that sounds, it’s actually proportionate to their local real estate values). They moved even more as renters–I believe their kids lived in a dozen houses growing up. I also have an engineer cousin who is on pretty much the house schedule TPC describes. He and his wife do very well, but it’s got to be a huge money suck that he keeps leapfrogging between jobs in different states and buying and selling houses.

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    • Dh and I bought our first home together at 25. It was only 2000 square feet but that was plenty of room at the time. We still own that house, and rent it out, but it would be a tight fit for our family today. We’ve taken advantage of the higher rent and lower costs of ownership several times with very good financial results.

      I have a friend who is raising 4 kids in about 1800 square feet in a questionable school district.(Rated “3” by Great Schools!) Most of her neighbors don’t speak the same language that she does and they are unfriendly. She won’t move because her mortgage is cheap, but the trade offs that she makes for that low mortgage wouldn’t be worth it to me.

      Another that reason people move – first floor master bedrooms for when they get old and don’t want to be bothered with the stairs all of the time. First floor masters are a pain when the children are little but awesome for parents of teens and old people.

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      • NYC is just depressing. We’ve got 2 kids in a 1000 sq ft place with lousy schools and last night my husband and i discussed how, down the road, we’re going to get rid of the couch and put a bunk bed in the living room.

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  3. Took us a long time to buy. Married nearly eight years with three kids before we bought the house we live in now. That was 15 years ago.

    Now houses in our sub are going for almost 3x what we paid and a lot of people are cashing out. We get mailers constantly from realtors detailing how much this or that house near us went for and inviting us to follow suit.

    The new neighbors all seem above board (neighborhood isn’t going down but up), but the neighbors we built connections with in either side and across the street have been replaced.

    As is my guy’s custom, he has made association and a working friendship with two of the new husbands on our street.

    Our house is big approx. 3000 sq ft. No reason to move up, especially since our older kids plan to move into their own place by this time next year*. Sure am gonna miss having three extra sets of hands to help with housework.

    A good reason for us to stay put is that we have an extensive homeschool community with some great part time schools on this side of town. And we don’t want a bigger mortgage. So we stay put.

    *No- we are not proponents of the SAHD movement.

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    • I’ve been following the Vision Forum influenced Christian blogosphere for long enough to see the SAHD movement play out and…boy there are a lot of women in their thirties who are STILL waiting for their prince. It seems to work well enough when the women get married relatively young and so the fact that they haven’t done the growing up that comes with supporting and managing a household was ok. And I know plenty of Asian kids that lived at home, worked and went to school, and banked money until they married or moved out in the late twenties. But there were so many blogs from these thirtysomethings who were still “serving at home”: not in school, not working, not much of…anything. It seemed super depressing because that’s not a subculture with any real place or identity for long term unmarried women.

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      • Oh, it’s almost comically awful. How are these women even supposed to meet anyone suitable if they’re puttering around the house like so many old ladies?! Someone didn’t think that all the way through. If they were men they’d be NEETs

        I’d be fine with my kids— especially my daughter— living at home til they got themselves established, but man, you gotta get out there and DO something. Being pretty and pious is not enough to succeed: you need some hustle too.

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        • There’s another problem with the whole “serve at home until marriage” thing that I didn’t grasp until I had kids. I got married with a ton of domestic skills because my family is very into that stuff, but it’s very, very different to help your mom do the cooking and shopping and cleaning vs. what I actually do as a stay at home mom with a husband who works a lot.

          I’m managing a household, which is a lot more like running a small business (How do I allocate the limited amount of time/money/energy I have to accomplish the family’s priorities? Where do I delegate? Is it better to have chicken nuggets for dinner or put the toddler in front of the TV so I can cook something better? Is the time saved having the toddler in front of the TV worth the tantrums when it gets turned off? Is this kitchen gadget going to save enough money and time that I should ask my husband to pick up an extra shift to fund it?) than doing chores, even a lot of chores, under the delegation of my mother. The work experience I had, which was clerical/retail/bookkeeping, nothing fancy, has been very, very helpful in that regard

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          • Make sense. My mom was a sheltered bride of 18 and was a TERRIBLE housewife. I mean this with love and I have more kids than she did at my age, so I’m saying this with the benefit of some practical experience, too.

            The executive functioning bit of it eluded her almost completely until I was an adult myself. She meant well but was easily overwhelmed, which is a bad quality for, basically, an office manager. You’d never put a ditzy 18 year old in charge of an office but apparently it’s fine to leave them with a couple of babies and all the tax paperwork. Ha

            A few years on her own probably would have helped my mom discern between “requirements” and “nice to haves:” she was prone to falling down weird useless rabbit holes like… learning Biblical Hebrew… while the pantry ran empty and the dishes went moldy in the sink. I’m guessing teenaged brides work out better in places where Grandma can drop by and supervise, lol

            Don’t get me wrong: there were some great moments, too, and we have a great relationship today. but yeah, it really was like being raised by an absent minded, semi-neglectful teenaged babysitter sometimes 😉

            Also, with the thirtysomething SAHDs, what on earth is the plan for old age?! An old married woman can at least claim social security on her husbands’ record, and that’s meager enough if there are no other investments! The church is charged with caring for orphans and widows, not… old single women suffering from arrested development. Brrr.

            Where there’s life there’s hope, but some people have really dropped the ball here.

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        • middle class and ambivalent said:

          “Oh, it’s almost comically awful. How are these women even supposed to meet anyone suitable if they’re puttering around the house like so many old ladies?!”

          Yes!

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        • Meglet said:

          “There’s another problem with the whole “serve at home until marriage” thing that I didn’t grasp until I had kids. I got married with a ton of domestic skills because my family is very into that stuff, but it’s very, very different to help your mom do the cooking and shopping and cleaning vs. what I actually do as a stay at home mom with a husband who works a lot.”

          “I’m managing a household, which is a lot more like running a small business (How do I allocate the limited amount of time/money/energy I have to accomplish the family’s priorities?”

          Exactly. And you can see this in the fact that the older married Duggar girls haven’t actually taken to SAHMing like ducks to water–it’s a very different experience to be a SAHM than to be a cog (even a large cog) in the machinery of a big household. I suppose it’s like the difference between being an employee at a large company versus being self-employed, where you have to be chief cook and bottle washer.

          I spent my last full year at home (I was 15 and my mom had cancer, which she eventually recovered from) doing whatever cooking, laundry and dishes that got done. (I have NO idea whether any cleaning at all happened during that period, because I was certainly tapped out just doing what I was doing after I came home from school.) As a young working adult living on my own and as a newlywed, I built up a lot of confidence about my culinary skills (although in all honesty, I was better at party cooking than basic dinner for one or two). The cleaning was extremely uncommon and panicky, though.

          What I didn’t realize about SAHMing as a teen and young adult is that you can’t just do one thing. Even when I was working so hard as a 15-year-old, I had a very limited portfolio–I didn’t have to clean, grocery shop, do childcare, do financial stuff, or take care of family clerical work. I could generally do just one task at a time, which is a luxury for the SAHM with small children. Even doing just childcare, you wind up with a lot of stress from multitasking dealing with more than one small child.

          I think there is a point where SAHMing can turn into a largely white collar job–that’s how I felt around the time my middle child was 5 or 6 (before our youngest was born). I’m not quite there yet with Baby Girl, though–I suspect it’s going to take longer.

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          • For me, adding the second child was when it turned into, “this is a very specific small business” instead of being a mummy. I’ve basically overhauled all the household’s procedures with an eye for efficiency, which was much less of an issue with only one baby. I do laundry on certain days. I batch cook on Monday, because I’m stuck at home all day babysitting the slowpoke portable washer and dryer, which does she sheets. We go out to the park at a certain time. There’s a grocery spreadsheet.

            Sharing this in case it’s useful for anyone else: our spending tracking had completely fallen by the wayside in the last year and I overhauled our financial tracking because I can’t keep up with ten different incremental budget categories. We have four categories now in Mint: house, utilities, my husband’s budget, and my budget. My husband gets a set amount per day to cover cabs, meals or beverages away from home, and incidentals. I get a certain amount per day for anything related to the household: clothes for the kids, groceries, household products, domestic help, outings for the children, etc. It takes me ten minutes twice a week to categorize everything and I can see at a glance how we’re doing for the month. It makes figuring tradeoffs clear in a way it’s not with more granular budget categories: I can buy free time with some heat and eat meals from Costco OR giving the sitter more hours OR ordering takeout, etc. And since my husband picks up shifts it’s very helpful to tell him: when you work X hours I can cover daily operating expenses for Y days. I wish I’d done it years ago.

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            • meglet said:

              “It makes figuring tradeoffs clear in a way it’s not with more granular budget categories: I can buy free time with some heat and eat meals from Costco OR giving the sitter more hours OR ordering takeout, etc.”

              Yeah.

              I had a couple years as a single young adult where I was pretty good at that sort of thing (it helped I was living in a cash economy and literally got my paycheck in cash every month and put the money in–ta da–envelopes!), but when I got back to the US and got married, had credit cards and little kids, my financial skills atrophied shockingly.

              It took me until I was 31/32 years old, with two kids, moderate debt and nowhere near to buying a house before the lightbulb went on listening to Dave Ramsey and I got back to thinking in terms of tradeoffs. But of course, with a husband and two kids, the financial picture was much more complicated than when I was a Peace Corps volunteer.

              (We typically have three dozen budget categories–ay yay yay! But the first three items soak up well over half our income.)

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      • @ Meglet:

        Our approach, which is vastly different from many of the MC/UMC families we have known over the years, was that we always made it clear to our daughters that they are free and welcome to stay at home for as long as they like. And that we will not treat them as if they are 15 forever and always as long as they live in our house. And we don’t.

        The other thing I have had to come to terms with (my affinity for SOME, not ALL of some of the family values notwithstanding) is that as young black women, our girls are probably just going to marry later because that’s just how it goes for college-educated black women, for better or worse. But we weren’t going to shun college because black women without college degrees are far, far less likely to marry at all. Forget about marrying well.

        We are pleased with the plan they hatched: All finish college and if they reached that point without having found a husband yet, then when they can afford it -not until- they will all move out together and rent a house together. They already know all the things they love and annoy in each other, they have shared values, and they will hold each other accountable to live up to who they were raised to be.

        They help out at home and are all domestically inclined in different ways. They are financially responsible (are better savers than their dad and me), and they take good care of themselves.

        Whoever gets any one them will be lucky, but he won’t find them if we keep them under lock and key. So we don’t.

        The oldest’s fledgling baking business (which she does in addition to her full time job) is really taking off, and this kitchen ain’t big enough for the both of us. I think 2018 might be the right time.

        They are prayerfully hoping marriage comes

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          • @TPC:

            Not great, really. We have friends with unmarried daughters who are older than our daughters. Several families with 5, 6, even 8 kids where one of the 4 or 5 adult kids is married. And these are conservative, white homeschooling families. A few families have adult unmarried sons as well, but the sons seem to fare slightly better. Just slightly. Most are not the SAHD types either.

            We have 4 or 5 black homeschooling families we”re friends with as well but they all are small families (3 kids or less) and none quite yet old enough for marriage. Got my eye on one young man for my 11-year-old but I would never tell her that.

            I think the economics coupled with adultescence is having a bigger effect than people realize.

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            • Elspeth said:

              “Got my eye on one young man for my 11-year-old but I would never tell her that.”

              Hee!

              I was a little too obvious about having marked down a certain good looking tween boy from a large family for Big Girl.

              They’ve probably gone separate ways since then, though.

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              • Well this kid is 15 now so a lot would have to go just right. At this juncture he thinks our family is the coolest and his mom and dad like us and we like them. Even hang out a bit.

                Of course this is all a courtship fantasy born of too much time in certain Internet circles. My husband thinks it’s funny.

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  4. To be honest, the main problem is that the traits of people who own homes are imputed to be based on the fact that they own home versus admitting that people with good habits own homes. Secondly, the other problem is that in most places, good rental housing is expensive, and generally isn’t family oriented (how many three bedroom apartments exist?), or it’s located in less than ideal neighbourhoods. Plus, overly restrictive landlords (no pets, no painting, etc), and automatic rent increases above inflation in some markets just create disincentives for people to rent even for even medium term rentals when there are better options available in the housing market.

    FWIW, I suspect you’re trying to create long-term home ownership to foster a sense of community, but the desire for ownership is so great that you’re unlikely to see anything to develop to punish short-term and medium-term home ownership, especially when the dynamic nature of the American economy creates a need for some people to move frequently.

    Heck, I’ve been in my cul-de-sac for eleven years, and I’m not close to my neighbours at all, and as my niece noted, nobody talks to each other. These are all people who have resided here for nearly two to three decades in some cases. Community doesn’t develop because people magically live together for years.

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    • David Alexander said:

      “Heck, I’ve been in my cul-de-sac for eleven years, and I’m not close to my neighbours at all, and as my niece noted, nobody talks to each other. These are all people who have resided here for nearly two to three decades in some cases. Community doesn’t develop because people magically live together for years.”

      Yeah. You know, it’s probably not hard to find more transitory neighborhoods (for example on military bases) where people talk to each other a lot more.

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        • Military people do have a ton of kids, mostly in marriage, even. I’ve always chalked it up to steady middle class wages/structured opportunities for advancement for the men, plus blatantly preferential family benefits (!), while the women’s job prospects are generally dismal at Camp Boondock. So they have kids! Dunno how replicable this is for society as a whole but the military does have a thriving SAHM scene that’s not just a weird religious conservative thing…

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      • TPC said:

        “by this standard the port town is the best and most stable community and most suited for healthy, functional family formation.”

        Residents having things in common is one of the components of having a good community.

        In fact, long time residence can sometimes be an obstacle, for example to newcomers.

        I’ve found that the fact that there is some coming and going in our community means that people are better at stepping up and dealing with new people, especially when there are recent arrivals who haven’t filled their social dance card yet.

        (“Befriend new people” is, by the way, one of the best tricks I know for making friends.)

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        • Right, plus for legit lifelong residents, typically they’ve got local *family* to fall back on, not neighbors, so they can be clannish, even turning a cold shoulder to someone who’s lived there a mere 15 years or whatever and isn’t at least married into one of the local sprawling networks of cousins, lol

          I like the small town I live in now but I don’t pretend I’m ever going to be on the inside of it… maybe my kids, if they stick around

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          • middle class and ambivalent said:

            “Right, plus for legit lifelong residents, typically they’ve got local *family* to fall back on, not neighbors, so they can be clannish, even turning a cold shoulder to someone who’s lived there a mere 15 years or whatever and isn’t at least married into one of the local sprawling networks of cousins, lol”

            Yes. When I was growing up, the local extended family constituted easily 90% of my parents’ social life.

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  5. Another thing about keeping daughters under lock and key is that it is a very bad idea if the father is not prepared to help her find a husband that she will actually enjoy considering being married to. Most parents (even older or old fashioned ones) are not into guiding their kids’ spousal search. My father was over protective when I was a teen/young adult, right up until I left home. He showed zero interest in helping me find a husband.

    At least not until I started up with my now husband because he didn’t really approve of him at first. There was a guy he tried to get me to consider, dating but I wouldn’t even meet him. It was too little, too late because I was all in with my husband at that point, heart (and everything else) long gone.

    All’s well that ends well since he loved him like a son within 2 years of the wedding, but it just wasn’t something he considered. He did approve of my two ex-brothers in law,but… And he came of age in the 1940’s after being raised in a small, close-knit community and raising us in a similar environment.

    I am curious enough now in researching how ubiquitous arranged marriage has ever been in the west.

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