I was thinking about this the other day. Due to the recent bubble and the still-high prices in many of the bubble areas, there seems to be a sort of automatic belief that "back in the day" things were a lot easier for those who "Got in" before prices went through the roof.
To some extent I would agree with that but it also depends on how far back you'd have to go. The Bay Area has never been exactly cheap. But at one time it was still somewhat affordable if you had a regular middle class job. I know for fact that most of my older neighbors live in houses they couldn't afford if they had to use their current incomes to pay for them. But at the same time I've talked with some of them and what they told me sounds like they too could barely afford to buy what they live in. For example my next door neighbors own a large victorian house. Beautiful looking place. But according to them the house was in absolutely horrid condition when they bought it. Windows were busted, the paint was long-gone, the interior was shot and so forth. The neighborhood was still predominantly working class. This was in the early 80's and they paid about $100,000 for the place. That might sound cheap today but in 1980 dollars that was a lot of dough and especially on their middle class income and especially for what sounded close to being a teardown house. These same neighbors could in no way afford the house they live in if they had to buy it now with their incomes.
My parents who live in NC had the same sort of story. They bought a chunk of land in the boonies for cheap but then built a ( for that time) large house on it. The house was $30,000 and this was in 1970. In rural NC in the 70's that too was a lot of money. They were scraping the barrel for years before the thing was paid off when I was in my teens. Unlike my neighbors things have not gotten as bad where they live in regards to the delta between home prices and incomes. They could afford to buy their own house on their incomes- which incidentally has gone down.
But I'm curious. Is there a different dynamic today versus 30-40 years ago? Is it more of the effects of purchasing power amongst certain financial demographics? Were things easier, harder or the same "back in the day" when it came time to buy a house?
My personal take is that the new middle class is basically what the upper middle class used to be a generation ago in that the middle class has actually transformed into the working class and many of us who actually make fairly decent incomes are actually middle class and thus we're having the same problems the middle class did a generation ago. The " old" middle class for all practical matters is now out of the picture in places like the Bay Area and can no longer afford homes.
I was thinking about this the other day. Due to the recent bubble and the still-high prices in many of the bubble areas, there seems to be a sort of automatic belief that "back in the day" things were a lot easier for those who "Got in" before prices went through the roof.
To some extent I would agree with that but it also depends on how far back you'd have to go. The Bay Area has never been exactly cheap. But at one time it was still somewhat affordable if you had a regular middle class job. I know for fact that most of my older neighbors live in houses they couldn't afford if they had to use their current incomes to pay for them. But at the same time I've talked with some of them and what they told me sounds like they too could barely afford to buy what they live in. For example my next door neighbors own a large victorian house. Beautiful looking place. But according to them the house was in absolutely horrid condition when they bought it. Windows were busted, the paint was long-gone, the interior was shot and so forth. The neighborhood was still predominantly working class. This was in the early 80's and they paid about $100,000 for the place. That might sound cheap today but in 1980 dollars that was a lot of dough and especially on their middle class income and especially for what sounded close to being a teardown house. These same neighbors could in no way afford the house they live in if they had to buy it now with their incomes.
My parents who live in NC had the same sort of story. They bought a chunk of land in the boonies for cheap but then built a ( for that time) large house on it. The house was $30,000 and this was in 1970. In rural NC in the 70's that too was a lot of money. They were scraping the barrel for years before the thing was paid off when I was in my teens. Unlike my neighbors things have not gotten as bad where they live in regards to the delta between home prices and incomes. They could afford to buy their own house on their incomes- which incidentally has gone down.
But I'm curious. Is there a different dynamic today versus 30-40 years ago? Is it more of the effects of purchasing power amongst certain financial demographics? Were things easier, harder or the same "back in the day" when it came time to buy a house?
My personal take is that the new middle class is basically what the upper middle class used to be a generation ago in that the middle class has actually transformed into the working class and many of us who actually make fairly decent incomes are actually middle class and thus we're having the same problems the middle class did a generation ago. The " old" middle class for all practical matters is now out of the picture in places like the Bay Area and can no longer afford homes.