Rental housing a conspiracy?
Maybe I've been spending too much time around my pessimistic father-in-law and his thought processes have started to rub off on me but the push to end people buying houses and move them to renting just rubs me wrong.
I am a member of one of the younger generations in the workplace. Go ahead, stereotype me, I won't lie, 99% of my news comes from the internet and yes, I probably spend more time on social media than I should. Does this scew the information feed that I get? Probably dramatically. However, when I come across something that I find interesting or that seems wrong, I do enjoy digging around and seeing what other information is out there. Recently though, I have had articles shoved down my throat about how I should rent my house and how buying will ruin my life. The articles that I find that oppose this view point don't even do so well, they are just there, it seems, for the sake of an article source having more articles online. This scares me.
According to the internet, I have already set myself up for failure as I got married and bought a house in 2017, bought two vehicles and have a 401k. Just as I start to think I am living the American Dream, my news feed gets completely overrun with how buying a house is the worst decision you could make, how terrible every vehicle on the market is and how much is wrong with 401k's. Of course, I take all this with a grain of salt and tend to ignore most of it. The part that scares me though is that I know there are people out there who don't. People who buy in completely to whatever the internet says.
These articles did get me thinking though. Of course vehicles are one of the worst things to buy (I will never buy a new vehicle) unless you plan to buy a new Lamborghini and bury it in a shipping container for 50 years, I have no argument here. And yes, now very well may be the worst time to be throwing money at a 401k but then again it could be the best time. I'm not a fortune teller so I will just keep contributing and hoping that my investor is still in business for a reason. But trying to convince me that renting a home is by far superior to buying is a waste of your breath (in most cases).
I grew up in a family with one income source that went from $36k to $45k between the time I was 10 and 18. My parents rented and had vehicle payments for as long as I can remember. This didn't leave much room for luxuries but we made it work. In fact it helped me tremendously in that it provided motivation. I saw the struggles of raising a family of 4 on this amount of money and know that some people are probably doing the same on less than half but I also knew there was more out there to life. As soon as I got my license, I got a job working for $8 an hour driving 25 miles one way 3 days a week during the summer. Now considering I was driving a pickup fuel was somewhat pricey but over the course of the next few summers I saved up $10k and bought a trailer house as a place to live in college and put the remaining $5k in savings for tuition. I went on to work 40 hours a week through the duration of college in order to make ends meet but still ended up coming out with $5k in student loans for a state University.
After graduating, I got married and my wife and I worked diligently to pay down our combined student loans of $10k. We started renting in exchange for labor on a ranch which meant a couple hours of ranch work a day on top of our day jobs but it kept money from leaving our pockets for rent, which was a plus. We paid off our student loans in about 9 months. After that, we started putting money away like crazy. We had the down payment for a house in another 6 months or so (not a mansion but a house that was reasonable in comfort and price). The thing we kept in mind the whole time was that we never wanted to put ourselves in a situation where we relied on both of our incomes. Having both lived through the housing bubble pop we saw how easily the economy could affect everyday life and we saw that the saying "easy come, easy go" does aply to jobs, so we made sure that either of our salaries could cover the entirety of our monthly expenses.
Not long after we bought our house, my wife was finally able to sell a trailer house she had bought in our college town and we used that money to replace our vehicles (while they were still driveable, their age and wear was getting a bit worrisome and we found out we were expecting and decided we didn't want the worry of being stranded on the side of the road with a baby).
So here we are left with a mortgage payment, an infant daughter, two paid for vehicles and a happy marriage.
I will definitely be the first to admit, my wife and I have terrific jobs for our age and we have both had terrific family support, not so much monetary but more morally in that they are always ready to provide advice and relatable experience whether it aligns with what we want to hear or not. In this we have been very fortunate.
Now on to the more relatable bit since I'm off my soapbox. I live in a two income household where both providers are college educated with business related degrees. You are probably thinking "duh, your family had the money to buy a house, your student debt was tiny, you didn't have to rent during college, you got free-ish housing right after college and were able to pay off debt and save money. You were in the right place at the right time". Well yes and no, I will take all the good luck I can get but I also work very hard to be in the right place at the right time. I didn't go to college to just get the easiest degree, I saw that so many people were doing so and decided why go into a a field with so much competition? So I went into one that everyone scoffs at: accounting. And when I graduated I had my pick of several jobs. When I decided where I wanted to live after graduating (job availability considered) I didn't pick Los Angeles, I picked a small community with a low cost of living. When I bought my vehicles, I didn't go to the closest dealership and give away my trades while paying top dollar for an already used up vehicle, I shopped for months and made sure I got the best money possible for my trades. While I can't rule out some luck leading me here, I am definitely not going to to give it even the majority of the credit.
I can already hear it, "college isn't for everyone," and you are right it's not. I completely agree. But I have watched several of my friends without a college education be able to progress in the workplace without a college education. Most coming from a poorer background than myself, so no it wasn't with daddy's money. It was with hard work and dedication to getting out of the situation that they had lived in for so long where you live paycheck to paycheck hoping it is enough.
So yes, I was able to buy the house I bought and cars I bought because of my job. However, I didn't buy a 2 bedroom 1,500 square foot house in town that isn't much to look at but has an appealing price. I bought a 2,300 square foot house on 5 acres with a barn and horse corrals. I didn't buy a Hyundai sedan with 80k miles but instead a diesel Ram 2500 with 30k miles and a Jeep Wrangler with 50k miles. What I am saying is I could have been a home owner and bought two vehicles for a fraction of the route I took. Hell, I could have already paid off my mortgage if I had went that route. Now I know the scenerios don't scale on a straight line because some costs are more fixed than others (I'm looking at you groceries) but making half the money I am now (which isn't a large amount by any stretch) I would have probably bought the smaller house in town, I would have bought a much cheaper vehicle. I could have made all of my purchases above at 25% of what I actually did. Would have it been as comfortable? No but I would have essentially had the same things, a house and vehicles and as my family is now, I still would have been able to make all the monthly payments on one income. Which means that I could have still established savings for home repairs like the A/C going out and would have been just fine.
So for all of these articles that say buying a house will ruin you financially, I counter your argument with this: buying a house outside of your means without a contingency plan and expecting everything to go exactly perfect in your future will ruin you financially. Buying a house with a very conservative mindset and staying disciplined in all of your endeavors will significantly increase your chances of success.
This brings me to the topic. With so many articles about how renting a house is absolutely the only logical thing to do, I can't help but wonder what is really driving the discussion. Is it possible that somebody has realized that many millennials are currently renting and that enticing them to continue doing so will push the housing market in the buyers favor? Now bigger institutions can swoop in and buy up property cheaper because demand has shrunk and some home owners aren't looking to be land lords. My ultimate question is this. How long before we buy our groceries from Walmart, collect our paychecks from Walmart and pay our rent payment to Walmart?
Just some food for thought. Who knows? I'm 180 degrees off for all I know.