Housing costs

[Jayv]

Just sold my house on Friday-small little townhouse. Price has doubled since when we bought it in 2009.

During those Ten years, my wages haven't doubled-and i am not sure how many ppl have, i suspect not many.

Feel sorry for the young kids entering the market right now.

 

[Baggsy]

Just sold my house on Friday-small little townhouse. Price has doubled since when we bought it in 2009.

During those Ten years, my wages haven't doubled-and i am not sure how many ppl have, i suspect not many.

Feel sorry for the young kids entering the market right now.

So, you made about 7% interest, minus any fees/costs in that time.

 

[Jayv]

So, you made about 7% interest, minus any fees/costs in that time.

The point i was making is the rise of the housing pricing compared to the real world wage earnings over a 10 year period.

I am not rich or smart enough to do the math to figure out that i made 7% lol.

 

[Mr.K]

we were out of the house by age 18 and by 30 doing better than our parents
no one handed us a fooking thing!

ya'll need to quit whining and buckle down!

Is this supposed to be /s? I can't tell.

 

[GreyGhost]

Is this supposed to be /s? I can't tell.

I don't think so. I have many friends that did that. Mainly by busting their ***** to have a better life than their parents, but it is possible.

As much as I still think the majority is worse off now, I don't think past generations had nearly as many opportunities to make serious money as a young person today. Sure, you put in your years, work your way up and you will get there and have the pension to show for it, but there are many 20 somethings making over 150K now which I think was a rarity in the past.

 

[Mr.K]

I don't think so. I have many friends that did that. Mainly by busting their ***** to have a better life than their parents, but it is possible.

As much as I still think the majority is worse off now, I don't think past generations had nearly as many opportunities to make serious money as a young person today. Sure, you put in your years, work your way up and you will get there and have the pension to show for it, but there are many 20 somethings making over 150K now which I think was a rarity in the past.

If you can move out of your house with nothing and get into a better position than your parents within 12 years, one or more of the following must be true: your parents weren't very well off, you got very lucky, the system was stacked in such a way that it would be difficult to not succeed.

Of course, we're talking averages and not just anecdotes. Even in a ****** economy, there will be some outliers that end up succeeding despite all odds.

There are 20 year olds making 150K plus currently, and I can't speak to all situations, but the ones I know of fall into the following categories: Their parents set them up with a job (family business, family connections, etc.), they work up in the oil fields, they have specialized jobs and went to school for 8+ years and likely are carrying crippling amounts of debt (unless mom and dad paid their way), or got lucky. It's also important to note that 150K doesn't go as far as it did 15-20 years ago (housing costs; they have to buy into the market with condos costing $750k plus).

Most people in their 20s don't have it as good as their parents did, unless their parents are (or have) paying for them to have that lifestyle.

 

[Trials]

My parents grew up with a depression mentality. I grew up thinking technology was going to save the world, you young guys, I have nooooo idea what you are thinking.

 

[Mad Mike]

So, you made about 7% interest, minus any fees/costs in that time.

The point i was making is the rise of the housing pricing compared to the real world wage earnings over a 10 year period.

I am not rich or smart enough to do the math to figure out that i made 7% lol.

You don't have to be smart to compute the return, you just need the formula.

I'm guessing you didn't pay cash for that house in 2009 -- if you did and sold it for 2x 10 years later you would have had approx 7% annual return. Your initial investment was probably only 10% of the house price, so I'm guessing that returned 25% or more on an annualized basis.

 

[GreyGhost]

If you can move out of your house with nothing and get into a better position than your parents within 12 years, one or more of the following must be true: your parents weren't very well off, you got very lucky, the system was stacked in such a way that it would be difficult to not succeed.

Of course, we're talking averages and not just anecdotes. Even in a ****** economy, there will be some outliers that end up succeeding despite all odds.

There are 20 year olds making 150K plus currently, and I can't speak to all situations, but the ones I know of fall into the following categories: Their parents set them up with a job (family business, family connections, etc.), they work up in the oil fields, they have specialized jobs and went to school for 8+ years and likely are carrying crippling amounts of debt (unless mom and dad paid their way), or got lucky. It's also important to note that 150K doesn't go as far as it did 15-20 years ago (housing costs; they have to buy into the market with condos costing $750k plus).

Most people in their 20s don't have it as good as their parents did, unless their parents are (or have) paying for them to have that lifestyle.

I was thinking specifically about the many programming type jobs. A friend with a startup budgets ~$250,000 USD as yearly cost for each programmer he hires. Most of his hires are in their late 20's and post-grad degrees are not necessary (and I don't even know if he requires uni as long as they are competent). My parents definitely had a better chance at a pension, but I doubt there were many jobs available in the market that far above the median for young(ish) people.

I was not thinking of family jobs as you are basically piggy backing off the hard work of your parents (maybe good for building a dynasty, but I don't trust the kids until they prove their worth).

As for the better than your parents, many of my friends had parents that worked their whole lives in factories. The kids went to uni and got white collar jobs with starting salaries not much different than their parents current income. Very quickly the kids moved into jobs earning much more than their parents.

 

[Mad Mike]

I don't think so. I have many friends that did that. Mainly by busting their ***** to have a better life than their parents, but it is possible.

As much as I still think the majority is worse off now, I don't think past generations had nearly as many opportunities to make serious money as a young person today. Sure, you put in your years, work your way up and you will get there and have the pension to show for it, but there are many 20 somethings making over 150K now which I think was a rarity in the past.

That wasn't rare, you just had to be good and willing to work your butt off. I crossed over the 6 figure threshold at 29, that was in the late 80s. I was doing well, but not big house 5 cars well. By 40 that pace became hard and I dialed it back to spend more time with my kids. Today I only work for fun -- if I go 10 days in a row NOT LOVING my job, it's over.

 

[Mr.K]

I was thinking specifically about the many programming type jobs. A friend with a startup budgets ~$250,000 USD as yearly cost for each programmer he hires. Most of his hires are in their late 20's and post-grad degrees are not necessary (and I don't even know if he requires uni as long as they are competent). My parents definitely had a better chance at a pension, but I doubt there were many jobs available in the market that far above the median for young(ish) people.

I was not thinking of family jobs as you are basically piggy backing off the hard work of your parents (maybe good for building a dynasty, but I don't trust the kids until they prove their worth).

As for the better than your parents, many of my friends had parents that worked their whole lives in factories. The kids went to uni and got white collar jobs with starting salaries not much different than their parents current income. Very quickly the kids moved into jobs earning much more than their parents.

$250K+ is far from normal. You'd have to move to the Bay Area and have considerable experience and/or a nice resume for that. The programmers I work with make ~$100K (I haven't asked for exact details). Your friend is either trying to draw extremely top talent, you're remembering incorrectly, or he's exaggerating slightly.

The parents -> kids thing is how most kids are getting ahead these days, since despite what some folks are claiming in this thread, it was easier to get ahead as a boomer and they are able to shell massive amounts of cash out to fund kids' fancy cars or nice apartments. It was actually common in my wife's program to have people's parents cover their costs, which equated to about $150-180k of loans not being required. These kids now don't have any debt, so their amount of disposable income is substantially higher than someone carrying that debt. My point is that these sorts of things are furthering the income gap and the space between the haves and have nots.

My mom worked in a factory and was able to make six figures. In some of her peak years she made up to $120k. She only had her GED.

 

[Baggsy]

I was thinking specifically about the many programming type jobs. A friend with a startup budgets ~$250,000 USD as yearly cost for each programmer he hires. Most of his hires are in their late 20's and post-grad degrees are not necessary (and I don't even know if he requires uni as long as they are competent). My parents definitely had a better chance at a pension, but I doubt there were many jobs available in the market that far above the median for young(ish) people.

I was not thinking of family jobs as you are basically piggy backing off the hard work of your parents (maybe good for building a dynasty, but I don't trust the kids until they prove their worth).

As for the better than your parents, many of my friends had parents that worked their whole lives in factories. The kids went to uni and got white collar jobs with starting salaries not much different than their parents current income. Very quickly the kids moved into jobs earning much more than their parents.

Wow, I should get back into the business then. What languages are they coding?

 

[r3r3r3]

Mid-level programmers are not making $250k+ here. Big tech companies have offices in Toronto/GTA because they know they can get a deal on programmers – they pay a fraction of what they do in the Bay area. I know several people who took computer science and the first thing they did after graduating was move to the US. You will start out making decent money here (70k+) but will hit a ceiling quickly.

Most of my friend group (mid-late 20's) with "in demand" skills/education are making under 100k and have a side hustle.

 

[GreyGhost]

Wow, I should get back into the business then. What languages are they coding?

Don't know exactly. Programming is not my thing. I just do enough to get by. Apparently full stack developers using Node and React? Those mean nothing to me.

Most of the jobs are in the US however they do hire in Canada. Sorry, I can't provide more detail as I can't provide both non-public information and the company to which it applies.

 

[GreyGhost]

Mid-level programmers are not making $250k+ here. Big tech companies have offices in Toronto/GTA because they know they can get a deal on programmers – they pay a fraction of what they do in the Bay area. I know several people who took computer science and the first thing they did after graduating was move to the US. You will start out making decent money here (70k+) but will hit a ceiling quickly.

Most of my friend group (mid-late 20's) with "in demand" skills/education are making under 100k and have a side hustle.

Although not confined to the Bay Area, he is competing against the giants for talent so he needs to pay accordingly.

 

[mimico_polak]

That wasn't rare, you just had to be good and willing to work your butt off. I crossed over the 6 figure threshold at 29, that was in the late 80s. I was doing well, but not big house 5 cars well. By 40 that pace became hard and I dialed it back to spend more time with my kids. Today I only work for fun -- if I go 10 days in a row NOT LOVING my job, it's over.

Then I need to ask what kind of work are you in? With our current situation I can pay off the hated townhouse and basically go to a normal job and enjoy life...however...I've explained it already multiple times! LoL

A buddy did that. Bought house, and had a developer want the land. Guy cashed out huge $ and now is just enjoying life with some part time work and flipping properties.

 

[GreyGhost]

A buddy did that. Bought house, and had a developer want the land. Guy cashed out huge $ and now is just enjoying life with some part time work and flipping properties.

If anyone gets in that situation, make sure you get seasoned advice before trying to cash a lottery ticket. Most developers would rather cut your land out of their plans then to pay a substantial premium. They pay a premium yes, but not as big as most people expect. Trying to get more money out of them is a great way to end up with a weird looking house in a new development and your value is in the shi##er because they ensure that you can't access the services they installed so you cannot be cost-effectively redeveloped. Once they are ******, even the original offer is off the table.

For a good example of what goes wrong, for many years there was a house in the middle of the Fortino's parking lot on Dundurn in Hamilton, it looks like sometime between 2005 and 2009, that was finally fixed. I am sure the owner would have been better off financially if they took the money at the beginning.

 

[mimico_polak]

If anyone gets in that situation, make sure you get seasoned advice before trying to cash a lottery ticket. Most developers would rather cut your land out of their plans then to pay a substantial premium. They pay a premium yes, but not as big as most people expect. Trying to get more money out of them is a great way to end up with a weird looking house in a new development and your value is in the shi##er because they ensure that you can't access the services they installed so you cannot be cost-effectively redeveloped. Once they are ******, even the original offer is off the table.

For a good example of what goes wrong, for many years there was a house in the middle of the Fortino's parking lot on Dundurn in Hamilton, it looks like sometime between 2005 and 2009, that was finally fixed. I am sure the owner would have been better off financially if they took the money at the beginning.

While I agree with you 100% ... in this situation buddy bought for 500k ... lived 1.5 years in it ... and sold 1.6M ...

 

[AllistonGT]

So, you made about 7% interest, minus any fees/costs in that time.

That was the bonus. He had to live somewhere. He could have paid rent and not enjoyed the equity he built up. But of course some one will say real estate is a horrible investment. I must be crazy to think other wise. lol.

 

[FullMotoJacket]

For a good example of what goes wrong, for many years there was a house in the middle of the Fortino's parking lot on Dundurn in Hamilton, it looks like sometime between 2005 and 2009, that was finally fixed. I am sure the owner would have been better off financially if they took the money at the beginning.