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Realtor breaks down how outrageously house prices have risen against income in just four years

Is buying a home still part of the American Dream?

home price increase

Realtor Freddie Smith shows the math of why millennials can't afford a house.

Does this conversation sound familiar?

Millennial: "Housing costs are ridiculous. And now mortgage rates are double what they were a few years ago. How am I supposed to afford to buy a house?"

Boomer: "You know what the interest rate was on my first house? Over 16%. I'd have loved to have a 7% interest mortgage!"

Millennial: "But you could raise a family on a single middle-class income when you were my age. That's just not possible now."

Boomer: "Well, maybe if you stopped buying avocado toast and Starbucks, you could afford a house."

Millennial: [blank stare]


Generational battles over economics aren't new, but some eras provide more fodder for such exchanges than others. Right now, it's the cost of housing that has younger people feeling stuck while older folks (or people who were lucky enough to land a house several years ago) are sitting pretty on the equity they've gained since the pandemic started.

Those of us who already own a house and aren't thinking of selling any time soon may not be fully aware of how drastically things have changed for those in the homebuying market. One realtor on TikTok shared a breakdown of the numbers, and it is eye-opening.

Watch this explainer from Freddie Smith:

@fmsmith319

Housing cost from 1995 vs 2019 vs 2023

Umm, yeah. It would take a truckload of avocado toast to even come close to making up for that increase. And these numbers are assuming you could even afford an $84,000 down payment. First-time homebuyers can often qualify for a 3% down loan, which makes it easier to get into the house but increases the monthly payment.

People in the comments commiserated, and many people asked what they were supposed to do in light of this reality. Some suggested buying land and putting a cheap mini-home on it until they had enough saved up to build a house. Others said to wait it out because the current market isn't sustainable and we may see a housing crash. (Though, as one commenter pointed out, "[In] 2019 we were told everything would crash but instead everything went up in record numbers.")

Some blamed the current administration, completely ignoring the global pandemic of the past three years that resulted in economic upheaval and ongoing fallout everywhere. The immediate housing market has always been somewhat unpredictable, and it's a crapshoot as to whether or not it's the best time to buy.

But when you can't even come close to affording it, it's a moot question anyway. Surely, something's got to give, but the question is what, when and how.

Smith has many, many videos showing the math behind the housing market. Follow him on TikTok for more.

All images provided by Prudential Emerging Visionaries

Collins after being selected by Prudential Emerging Visionaries

True

A changemaker is anyone who takes creative action to solve an ongoing problem—be it in one’s own community or throughout the world.

And when it comes to creating positive change, enthusiasm and a fresh perspective can hold just as much power as years of experience. That’s why, every year, Prudential Emerging Visionaries celebrates young people for their innovative solutions to financial and societal challenges in their communities.

This national program awards 25 young leaders (ages 14-18) up to $15,000 to devote to their passion projects. Additionally, winners receive a trip to Prudential’s headquarters in Newark, New Jersey, where they receive coaching, skills development, and networking opportunities with mentors to help take their innovative solutions to the next level.

For 18-year-old Sydnie Collins, one of the 2023 winners, this meant being able to take her podcast, “Perfect Timing,” to the next level.

Since 2020, the Maryland-based teen has provided a safe platform that promotes youth positivity by giving young people the space to celebrate their achievements and combat mental health stigmas. The idea came during the height of Covid-19, when Collins recalled social media “becoming a dark space flooded with news,” which greatly affected her own anxiety and depression.

Knowing that she couldn’t be the only one feeling this way, “Perfect Timing” seemed like a valuable way to give back to her community. Over the course of 109 episodes, Collins has interviewed a wide range of guests—from other young influencers to celebrities, from innovators to nonprofit leaders—all to remind Gen Z that “their dreams are tangible.”

That mission statement has since evolved beyond creating inspiring content and has expanded to hosting events and speaking publicly at summits and workshops. One of Collins’ favorite moments so far has been raising $7,000 to take 200 underserved girls to see “The Little Mermaid” on its opening weekend, to “let them know they are enough” and that there’s an “older sister” in their corner.

Of course, as with most new projects, funding for “Perfect Timing” has come entirely out of Collins’ pocket. Thankfully, the funding she earned from being selected as a Prudential Emerging Visionary is going toward upgraded recording equipment, the support of expert producers, and skill-building classes to help her become a better host and public speaker. She’ll even be able to lease an office space that allows for a live audience.

Plus, after meeting with the 24 other Prudential Emerging Visionaries and her Prudential employee coach, who is helping her develop specific action steps to connect with her target audience, Collins has more confidence in a “grander path” for her work.

“I learned that my network could extend to multiple spaces beyond my realm of podcasting and journalism when industry leaders are willing to share their expertise, time, and financial support,” she told Upworthy. “It only takes one person to change, and two people to expand that change.”

Prudential Emerging Visionaries is currently seeking applicants for 2024. Winners may receive up to $15,000 in awards and an all-expenses-paid trip to Prudential’s headquarters with a parent or guardian, as well as ongoing coaching and skills development to grow their projects.

If you or someone you know between the ages of 14 -18 not only displays a bold vision for the future but is taking action to bring that vision to life, click here to learn more. Applications are due by Nov. 2, 2023.
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