Remember the 50s? No? Me neither, probably because I was born in the 80s, but I have heard tales of a simpler time. Where technology did not run our lives, where people knew their neighbors and looked out for each other, and apparently a single income could buy a house.
I recently read an article and the ensuing comments shared by a friend. The article written by Huffington Post entitled “How Much Money You Need To Make To Buy A Home in 27 Major Cities”, was not too far off in its estimations. Even gave a detailed description of how they came up with their estimations. Not bad HuffPo, not bad. The article, wasn’t what made me think though, instead it was a comment. A person who shall remain unnamed stated
“when a single income minimum wage family could buy a home in just a few years back in the 50s? Ya apparently that generation forgot…. our generation are lazy and want “free” stuff when in reality we just want the same opportunities…. funny eh?”
First, a single income took more than just a few years to buy a home Second, they didn’t forget and are correct in the assumption that millennials want free shit. Third, there is more opportunity now than there ever was then, and millennials just want free shit (just had to reiterate that one).
Notice the picture above, that was the stereotypical family in the 50s, that bygone era that people yearn for. Notice something? The man is in his business suit having just returned home from work, the woman has her apron on and is presenting a cake to her family. I could be wrong, but more than likely she baked that cake from scratch and not some mass-produced Betty Crocker cake in a box mix. That must have taken her hours, when did she go to work? She didn’t, because in the 50s that wasn’t her place. He knew it, she knew it, even the kids knew it. So the man of the house literally brought home the bacon and provided with his single income, maybe it was minimum wage, maybe it was higher. Point being, most homes were single income homes.
Why is this important? Home builders weren’t out there building houses people couldn’t afford, that is just bad business. If you build things that nobody can afford, nobody will buy those things. If nobody buys those things, you go out of business, capice? Since the demand was for homes that could be afforded on a single income, the builders supplied homes to meet that demand. Fast forward to feminism.
No, I am not blaming feminism, but it will help explain somethings. By the mid 70s when the movement was being brought to the mainstream, many more women were at work than in the previous generation. What does this mean, well if more people have more money, they are naturally going to demand more things. If the supply is finite, which it typically is, the price of those things goes up. So lets look at houses, in the 70s. According to the US Census Bureau, in Colorado, the median price for a home in the 1950s (adjusted for inflation) was $43,300. The median home price in Colorado in the 1970s…$66,400. That’s a jump of 50% in just 20 years! In the 80s, when feminism and equality in the workplace was the massive push the median house of homes jumped to….$126,900. A 100% increase from the 70s and almost 300% from the 50s. Why is this you ask, simple there were more workers.
Lierre Keith, noted feminist and former vegan, correctly pointed out that when women are added to a job field the value of that job goes down. This does not mean that women are worth less than men, what this means is that the more people who want to do a job, the lower the pay will be. Again supply and demand. If the supply goes up and the demand remains the roughly the same, then what people are willing to pay for that supply goes down. So as more and more women entered the workforce, the pay did not rise at the same rate as the consumers demand. More people could afford more things, nicer things, shinier things. The cost of everything went up, to include homes, but pay remained relatively low. Not until the .com boom of the mid 90s did pay see a significant increase, it didn’t take the market very long to correct for this.
More pay meant more people wanting more shiny things to include houses. this is where the housing bubble from 97-07 came in. And in 2007 the bubble burst and in a big fricken way. No one sector is to blame on this one. Government, banks and consumers all have their hands dirty. Anyways, the result of this burst, was the occupy wall street crowd. This is the same crowd that now needs safe spaces, trigger warnings and is demanding free healthcare and college. That is why people from the 50s think millennials want free shit, because they do. This is also the same crowd that believes raising the minimum wage to $15/hr will allow them the ability to buy a house and have a living wage. If you believe this, I suggest starting this article over and paying attention.
Listen, the simpler time of the 50s that the unnamed person is lamenting about, is gone. It is not coming back, but that doesn’t mean things are bad. The opportunities are even more abundant now than they were then. The biggest difference is the work ethic and fiscal responsibility. Folks who owned houses in the 50s just went through WWI, The Great Depression, WWII and the Korean War. They learned to live within their means, especially because of the depression. They learned to save money, and not spend on frivolous things. Sure, they indulged, but they didn’t have credit cards, they couldn’t have now and pay later. When they wanted something, they had to save for it, now we have credit cards and our gratification is instant. They learned about working hard and spending their money wisely. Millennials are more concerned with spending their money on frivolous shit than actually earning the money. So yes, the generation of homeowners from the 50s have a reason, and a very good one, to look at my generation and millennials with a lot of disdain.
Want to solve this problem of home ownership, it is actually pretty easy. Live where you can afford to. If Denver is too far out of reach, try a suburb. If San Fransisco is too expensive for your wallet, don’t live there. Supply and demand. Drive the demand to live somewhere down and the prices will reflect it. This is why New York, L.A., San Fransisco and other super crowded places are expensive as hell, but Topeka is ripe for the picking. Some might ask”who wants to live in Topeka” and to them I say ” the person who wants to buy a house on a single income.”