[quote=deadzone]KSM, how do you see that the ability to pay for $1M houses gets easier with age? Given today’s culture, the only way that is true is due to inheritance.
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Some folks accumulate savings. Some accumulate equity in previous homes. Some leverage one home to go into a nicer home maybe even if they shouldn’t. It’s not like they’re putting 0-10% down – they bring equity to the table. So they’re not paying the $7k/mo you quoted. Not everyone pays PMI and MR.
Folks have had time for their businesses to mature.
Folks get raises. Maybe someone starts at $40k a year and ends up at $150k a year or more.
They get married, and maybe their spouse makes good money too.
Or folks have worked in enough companies and finally had some stock options pay off. I know a guy that at his first 3 companies they were worthless, but at his last two, he did very very well.
Folks become senior managers and get better and better bonuses.
And yes there is inheritance.
DZ, let’s take Del Mar, west of the 5.
There are a lot of homes there. A lot of expensive homes. Who do you think lives in them?
In general they are not the least responsible and least accomplished among us. They are not the “typical” folks in today’s culture you seem to be focused on.
They are the more responsible, the more clever, the harder working, the more charismatic in some cases, the more ambitious, the better savers, the more “greedy” perhaps. They may have had the benefit of educated parents and a good upbringing that set a good example and set them off in a good direction, even though they haven’t inherited yet.
They are people who like nice things and are willing to work hard for them. I am excluding here crooks and inheritance. Some are professionals, some are executives. Some are business owners.
Do you think the supply of folks like that is now somehow depleted? For all time? Baloney.
Unemployment will not be at 10% for the rest of our lives, probably not even the next five years, in my opinion.
To tell you the truth, I am starting to see some “green shoots” the last few months. (To use an intentionally provocative phrase).
