Wages have only multiplied 7-fold, meaning millennials have to work TWICE as hard as boomers to be homeowners
Millennials, ever wonder why it’s taking you so much longer than your parents to become a homeowner?
It’s because houses cost twice as much (when adjusted for inflation) as they did when the baby boomers were buying.
A new report finds the average house in the United Kingdom costs 14 times as much as much today as it did in the late 1979, when many baby boomers were buying their first homes.
Meanwhile, wages have risen at half that rate – 7 times – meaning the real cost of a house is twice as much, which means millennials have to work twice as hard to be a homeowner.
The analysis of official data was provided by digital broker Mojo Mortgages and Yahoo Finance UK.
Similar analysis shows the United States is on a similar, if not worse, trajectory.
“In 1990, baby boomers, whose median age was 35, owned nearly one-third of American real estate by value,” reports the Philadelphia Inquirer.
“In 2019, the millennial generation, with a median age of 31, owned just 4%.”
While millennials are likely to make up a little of that gap by the time they reach 35, they won’t reach any where near the 30% of the housing market baby boomers own — or even the 20% attained by the smaller Generation X by age 35.”
While the experts remain silent about WHY the real cost of housing has doubled in 40 years, one big factor seems obvious to this millennial.
Guess what else has doubled since baby boomers started buying houses? The population… from just under 4 billion in in 1973 to almost 8 billion today.
It’s a simple problem of supply and demand (minus a few other factors). If you double the demand without doubling the number of houses for sale, prices are going to go up.