I personally know of several people with good jobs who just walked away from houses because they owed more than the house was worth after the '08 crash.
This is something that gets little attention. The focus tends to always be on "the innocent person who got suckered into a loan they couldn't afford and the bank took their home" <- while that may have started the trend many people just didn't feel like being upside down on their mortgages and it was fashionable at the time to "hate the big banks" <- quotes are not for sarcasm, just that they're the word choices often used by people
So is being born in the right family.
Not to detract from intelligence, hard work, ambition and perseverance, but people downplay or don't want to accept the very significant role that fate, serendipity, fortune, luck, whatever you want to call it plays in these outcomes.
No doubt this is true, and people like to glance over that, but from my personal experience I've found the inverse to be true. My experience as a self-loathing millennial, ugh, is that my peers with the uber-rich parents kind of became (or are becoming) deadbeats... not finishing their free (mom and dad paid) graduate level education or becoming perpetual students and never really landing a job they're happy with. These folks may cruise through life on family money, but eventually that will run out... people like that don't do their future generations any favors.
On the flip side, people I've known who grew up very modestly, didn't go to Ivy league schools, etc., ended up running their own businesses or applying themselves through education and getting decent jobs.
Personally I grew up very middle-income, paid my own tuition in college, and am living comfortably now (not rich, but well enough).. sometimes not being given everything can be a good motivator to earn things on your own
Ive never understood the American obsession with 'house poverty'.
People shouldn't be house poor - that's not wise.. people who do that look too romantically upon the idea of home ownership. However, at least in my neck of the woods you can easily spend $2K or more per month on relatively mediocre apartment housing. When you write that $2,200 rent check you are doing all of the following:
-Not building equity
-Not actually buying something that is yours
-Not building your credit worthiness (you're not hurting it either)
-Not having a guarantee on your future housing
-Not having a guarantee on your monthly rental amount
-Etc.
On the flip side, if you were instead putting that $2,200 towards a mortgage then you are actually physically buying something that is yours with each mortgage payment and you can use your house as a bank with lines equity credit, you can borrow against yourself, and on a long enough time scale homes are a pretty guaranteed net positive investment. So even in a market downturn if you can keep your job and keep making those payments you can come out the other side
But home ownership is not right for everyone, and people need to think long and hard before purchasing for a myriad of reasons
