At $84k average household income, assuming 1/3 going to a mortgage would give you $2.3k a month to work with. At 6% interest rate, assuming 20% down payment of $70k, you can just manage a $350k home and that is ignoring taxes, not adding other closing costs, not considering utilities, assuming an interest rate on the lower side and assuming a 20% deposit.
Add tax and that gives you around $1.7k to work with. Assume only putting down 10% and adding in $400 a month to cover utilities then you can manage around $175k home. That rules out buying a house in alot of the US.
And yes, households in more expensive areas make more but if you are buying the average house, that costs $410k you need to be making like double the national average income to stick to the 1/3 rule. How many households are earning $170k where houses are $410k?
Are people just devoting 50%+ of their income to housing? Everyone buying a house with the help of mom and dad? I just really don't get it.
It's 59 years old lol.
Boomers and institutional money are doing the home buying.
https://www.apolloacademy.com/median-age-of-all-us-homebuyer...
In 2009 the same chart shows that the median age was 39.
In the early 80s it was early 30s.
Look at congress, we live in a boomer gerontocracy. Not every boomer is wealthy and powerful, but the majority of people who are wealthy and powerful are either descendants of elites/wealthy, boomers, or a very small fraction of younger tech/finance/business owners.
Since the layoffs, I’ve taken a sizable paycut (~$75k TC) to make ends meet with whatever I could find, but kept a pulse on the market in case things turned around. Locally, rents have gone down by ~$100-$500 a month (depending on when you renew) with one to two months free rent, while home prices have finally stopped rising. Homes are staying on markets longer, and bidding wars have dried up. I get about one to three price cut messages a day from Redfin, though nothing in my area or price range post salary cut.
Unfortunately, I don’t expect this trend to continue. My landlord just introduced a new RealPage-alike to keep rents high, local developers have put a hold on new housing construction as resources get consumed for AI datacenters, and the same old red tape blocks meaningful progress in addressing availability gaps. The only real bright spot is that renters are pushing for statewide rent caps and controls with better progress than ever before, so there might be some relief in sight next election.
It’s bad out there, ya’ll.
If there is some incentive toward development in non-rent control jurisdictions I suspect it's strongly dominated by other factors.
(ie. Montreal probably has the most restrictive rent control in Canada but it's also seeing the strongest apartment development growth)
Edmonton recently outpaced Toronto in housing development on an absolute basis with much lower housing prices and less than 1/5th the population!
Those are the two factors explaining the housing starts, not the ineffectual rent control that exists in Ontario.
it's the "credibility revolution" and someone has won a nobel prize for it.
rent control causes limited mobility (read: displacement out of town) by 20 percent; it causes reduced rental housing supply by 15 percent:
https://www.aeaweb.org/articles?id=10.1257/aer.20181289
rent control causes reduced property values:
https://economics.mit.edu/sites/default/files/publications/h...
Courts actually need to do their jobs here for an optimal solution - e.g. it should be easy to punish shitty landlords AND easy to kick out shitty tenants.
It shouldn't take a 1+ year wait (as during COVID) to get a landlord-tenant court date to resolve issues.
The housing issue is multi-faceted however, so that's only 1 piece of the puzzle. But thanks to NIMBYs and building code overreach, it's literally impossible to build affordable housing that would rent at its own depreciation schedule.
A wonderful city like Montreal can drive enough demand for housing to overcome red tape, and still be building far far less than what would satisfy demand. A less attribute city with lower demand for housing may build less due to lower demand, despite having less red tape.
Trust the economists on this one.
Rent control on the other hand has mostly local effects.
Which means, rent control can push prices down and keep them down. There is indeed a supply reduction, and prices on average will go up—but not in the rent controlled area.
It’s still a poor idea, but it requires centralised planning to avoid.
One of the problems with rent control is that it pushes the class politics so that renters with housing act more like landowners than they do new tenants, and they conspire to also block housing. People are change averse, even if they don't mind the change after they see it; before the change it's a big threat. This hurts any tenant that needs to move due to things such as becoming an adult, finding a new job, starting a family, getting a divorce or ending a relationship, etc.
Rent control is great as a tenant protection to prevent evictions via rent increases, but it is only a short term protection for tenants otherwise, and can hurt tenants greatly if there's not enough building.
Land is something the government can help with if they choose to do so.
The rent is tied to the price of the apt, and since housing has become and investment category, has increased exponentially.
By controlling rent, you control real estate prices as well, as investors will find it a less attractive asset.
In a free market economy, the cost of things should be controlled by a market equilibrium, so building shouldn't cost more to buy than it is profitable to build tem.
But supply is often restricted by artificial means, meaning prices go up, that's where rent control comes in.
Two wrongs don't make a right, but saying not having rent control while clamping down on construction isn't true to the spirit of the free market.
There is no silver bullet solution. Rent control can be a big part of that solution, but what’s ultimately needed are a combination of policies that disincentivize the hoarding of housing as an asset class, promote home ownership itself for stability and community rather than fiscal nest egg, mandate denser housing in areas served by mass transit, tax land properly by removing caps on yearly increases, protect renters from unnecessary evictions (lack of renewals, no-fault evictions, etc), removing zoning laws on residential and commercial space (essentially reducing zoning laws to industrial vs non-industrial) to speed up approvals for construction, and get the government more active in meeting the needs of its populace through public housing programs (like Singapore does).
It’s highly complex and nuanced. I’ve long since stopped entertaining smug clapbacks from armchair economists who aren’t involved in the boots-on-the-ground issues at hand, and you shouldn’t parrot them around for them.
This makes no sense, the battle is ultimately between renters and owners of low density housing. Those owners don't care about rent control, they only care about zoning disallowing construction of new rentals. If anything, they're probably happy to see rent control if it means the pressure on cities to upzone is removed.
Once any of those multitude of variables aren’t equal, however, the market can and will exploit it. This is the reason why the housing crisis is global, but the solutions are variable. In New England for instance, there’s a glut of available property currently being hoarded and vacant as an investment hedge, because we have no more land to expand onto. Combined with vacant towns that were former industrial hubs, and there’s an awful lot of available real estate to be clawed back for better use - except markets have been tailored to specifically promote a hoard-and-hedge strategy that harms the working classes (renters and homeowners both), and keeps depressed communities from rebounding. Remote work had a real shot of revitalizing those towns and shattering the vice grip of Capital on land or housing through the relocation of workers to cheaper markets, but the RTO mandate essentially amplified existing crises that much more and robbed them of the chance to rebound.
So no, it’s not as easy as building more housing, it’s also about ensuring those who need housing get access to it first, rather than those who simply seek to extract rent or hold it as an investment hedge.
Again, there’s no silver bullet to this problem.
To me it seems the opposite: Rent control means supply goes down, so available building & land prices go up. These prices going up means an opportunity for builders who are good businessmen because they are going to make a margin on their investment, the bigger the investment the bigger upside.
Another intuition is with rent control it's hard to extract new value from an old building, so that also incentivizes tearing it down and squeezing more units into the land.
In SF, rent control exists on all buildings built before 1979. It appears to me that people who prioritize new builds pay a huge premium for them. I think this particular rule also incentivizes tearing pre 1979 structures down, vs the no rent control newer buildings can continue to have growth in the value extracted from them.
From my understanding, European countries tend to have restrictions on what lease renewals can look like and with declining home ownership (and ownership being priced out for many), I think we should look at European models for real solutions to our housing crisis.
But the worst/most aggressively laws are always used as the examples, skewing the conversation to edge cases and ignoring the fact that these laws can and do take hundreds of different forms.
In California (and SF in particular) rent control applies to housing older than 15 years and owned by corporate entities.
How does rent control applied as it is in California disincentivize building? I would think that building would be incentivized by rent control because newer housing stock would be exempt from rent control.
People have been knocking down doors to build in SF for decades, but do not because regulatory capture by homeowners, landlords, and those with below-market rents are happy to keep out new people.
Where and when housing gets built in the US is not merely a market driven decision: you also need to get local permission to build.
The benefit of rent control would be turning up the pain on the PE people and driving them out of the market.
It is exceptionally rare for new construction to be subject to rent control laws, unless they utilize special tax breaks or government subsidies. It does nothing more than slightly inconvenience the investor class, who usually aren't thinking past 15-20 years anyway, when rent control laws might theoretically impact their investment.
> [A]ccording to the studies examined here, as a rule, rent control leads to higher rents for uncontrolled dwellings. The imposition of rent ceilings amplifies the shortage of housing. Therefore, the waiting queues become longer and would-be tenants must spend more time looking for a dwelling. If they are impatient or have no place to stay (e.g., in the houses of their friends or relatives) while looking for their own dwelling, they turn to the segment that is not subject to regulations. The demand for unregulated housing increases and so do the rents.
Though I think the likely dynamic that you're seeing here is rent growth of new build apartments is stalling and reversing, and on renewal with new tenants rents are being revised downward as there is more competition.
https://www.ctvnews.ca/vancouver/article/rent-prices-falling...
I expect that amongst apartments with long term tenants rents are still creeping upward. But that's fine. The point of rent control is to smooth out volatility. Rents can still go up, but the goal is to avoid sudden 150% increases etc.
Is it? I mostly see rent control maximum increases below the inflation rate, suggesting a different goal (appealing to voters?). If it were just to eliminate extreme volatility I think we'd see more 5/10/20% increases and less 1/2/3% increases.
This monopolistic pricing is a massive part of the issue. Hopefully the case the DOJ brought against them is progressing well. They've essentially created a cartel of landlords trying to squeeze you for every single penny.
They reached a settlement with the DOJ last week [0].
0: https://www.realpage.com/news/realpage-reaches-settlement-wi...
https://www.justice.gov/opa/pr/justice-department-requires-r...
You should get in touch with your state AG, and point to the precedent for this being considered illegal.
So I would say anyone in the present is out of luck here
It’s bad.
It sucks.
“Spray Foam Specials” - gobs of sprayfoam insulation and a fresh coat of paint.
“Gap Properties” - because who needs floorboards to actually meet?
“Skatepark Schemes” - for when the floors are so bowed you can do lip tricks at the room edges
“Flashpoint Fixers” - surface-level flip jobs that kept the knob-and-tube wiring alongside newer Romex
“Oil Derricks” - any home with an oil tank on a foundation of compacted earth or otherwise lacking a groundwater barrier
After I switched it over to a rental listing I was able to rent it out within 3 days at a significant profit. Another unit in my building rented similarly fast at a similar price. I know it's just anecdata, but it doesn't feel like the rental market is cooling down at all.
> The Bay Area continues to lose jobs across high-income sectors (-0.4% YOY), driving modest overall employment declines. These job losses have slowed compared to a year ago but remain negative YOY. Despite generating substantial spending and wealth, the AI-driven tech boom hasn’t added meaningful employment to the region.
However, I keep thinking about how someone I know was laid off last year only two months after buying their first home.
I'm a SWE making OK money here but not FAANG/unicorn-level, so it's tough to imagine buying and then being on the hook for a mortgage without a job even with some savings.
Absolute hell. Now, thankfully we didn't over-extend, and live by the at-least-6-months-of-savings.
We made it through, but just writing this down makes my heart rate spike.
Of course I say all of that and it's good to know what could happen if a terrible downturn does happen like in 2008 (even the nicest Bay Area hoods prices dropped 25%+).
Last thing, single family houses, especially in the Bay Area, are typically more insulated from price drops (insulated not immune). If you can afford a small single family then it might be worth it, especially if there's expansion potential (either for yourself or the next buyer if you decide to move on). And even better if there are some cosmetic problems that are tractable because let's say you do get laid off there's nothing like building some sweat equity in the downtime.
Just my two cents having gone through similar in the past.
Reading all this from distant Europe, its interesting (and logical) how in US the swings in prices are so extreme in both directions. In fact, most things in any regard are way more extreme in US compared to Europe. May be good for the lucky ones but long term stability or dependability this ain't.
Sure, but doesn't really help if the job is in the Bay Area.
If my house is worth less than what I owe then moving (selling short) can make sense.
Houses are not just an investment for most people. There are investment factors, but they are also the place you live. Thus most people cannot just sell or not - they also have to consider where will they live next if they sell. Even if I knew exactly where the bottom would be odds are I'd still not sell because I don't have options to live elsewhere.
Delistings Jump 28% as Sellers Pull Homes Off Market Rather Than Settle For Low Prices - https://www.redfin.com/news/delistings-jump-sellers-pull-hom... - November 25th, 2025
Foreclosures Rise for 8th Straight Month—These States Have the Worst Rates - https://www.realtor.com/news/trends/foreclosure-increase-att... - November 14th, 2025
Pending Home Sales Slip As Would-Be Buyers Wait For Lower Rates and Economic Clarity - https://www.redfin.com/news/housing-market-update-pending-sa... - November 13th, 2025
(real estate market participant)
I believe this varies by state but I thought in some states the lender can come after you for the difference and in others you can just walk away (albeit with a credit ding).
https://www.financialsamurai.com/non-recourse-states-walk-aw...
(have walked away from underwater fha mortgage from 2008 gfc in a recourse state, ama)
And then they stop building new stuff while prices are low, so demand will keep prices stable, and when the interest gets lower again prices will probably skyrocket since it's not been built enough in the meantime.
One theory says that either lower employement causes lower demand and therefore lower interest rates OR lower employement causes the FED to lower interest rates to stimulate spending, and in EITHER case the response to your premise of "low employement + high interest rates" should be "interest rates will come down", and separately "low employment implies low demand implies house prices will come down".
K-shaped economy and all that I suppose.
Looks like shipping is also an industry that you probably don't want to track on this search. Other than that, places that saw modest wage growth saw similarly modest housing cost growth. And haven't seen it fall back, yet.
The housing shortage was created by regulation and it's foolish or selfish to pretend otherwise.
Austin is unique in that most of the harmful self-serving conservatism-as-in-block-and-deny-all-development that city people usually to do is constrained by the rest of the state, and as an obvious result arguably has the highest standard of living in the entire world.
But yeah, we built a LOT of housing and that means buyers and renters have a lot of choice.
It's hard to argue that's a bad thing unless you're a property owner who's upset their house didn't appreciate 20% in 5 years.
regulation /tends/ to be introduced because builders are misbehaving (bad materials, bad workmanship, building in flood zones, etc), but the bigger problem is NIMBY who then use those laws to prevent other people building in "their" neighbourhood
https://www.brookings.edu/articles/make-it-count-measuring-o...
Millennials are a large cohort, too, so it may stay steadily high for a good long while after that, after perhaps a small dip for X. Depends how much money they have for the healthcare sector to scoop up. Savings-at-same-age has been really bad for them relative to boomers, so we’ll see. May see healthcare employment shrink even as need (sans the dollars to back it up) grows, next time a demographic “lump” gets old.
If UBI were national, it would work beautifully, because depending on the UBI amount, it could allow people to finally untether geographically. You could spur a rebalancing of irrational demand in HCOL cities due to jobs away from HCOL to LCOL
On the one hand, less high earning employees seems to logically indicate that large purchases would also go down.
And on the other hand, a program to give everyone a little eating money would never have been able to pay for a house, anyway.
Are other developed countries firing people in the same way rn?
That said, even if housing prices drop materially and eventually bottom it will provide little opportunity for "normal" folks to buy in if they're jobless. Will be interesting to see if Fed interest rate cuts translate to mortgage rate cuts, and whether those rate cuts lessen any price drops.
I've said this before on here, but the historical price-to-income for housing has been something like 4x. Today it's 7x (that is as insane as it sounds). A long way to revert to the mean unless you really think "this time is different."
The expected return is considerably higher now, this should mean that houses should be traded at PR at around 20 again (as opposed to upwards of 30 when there was no better investments to be made).
Investors will likely not be an issue as long as we don't go into zirp again.
Isn't it only bad news for people who are selling their homes?
This has been so weird to see over the last couple dips.
In the ‘08 crash, banks were sitting on houses that were developing mold issues because they had been sitting vacant so long. These houses were getting more damaged and less desirable by the day, and before long would require hundreds of thousands of dollars to fix (up from the low-tens already evident) but they still preferred to sit on them. They weren’t listed, or were listed but at too-high prices and they were just ignoring offers, not even responding.
Then you look at “depressed” housing prices that are still way over historic norms, so you’d think builders would keep going… but no, they totally halt all work, no new houses until prices are heading up again.
Something’s super messed-up about the housing market in ways that it wasn’t in the last millennium. Recessions don’t even fix it, they just make everything pause.
The key of course is that the downturn isn't so massive (hello 2008!), where the blood flows so freely that the layoffs/foreclosures/etc. overwhelm the eligible buyer pool in absolute numbers. That can for sure happen, but is atypical historically.
Also pretty disgusting to me that healthcare is "growing faster than normal" across the board. You'd think it'd be "growing the normal rate" at least somewhere. It's not like population is growing faster than normal across the board. Isn't 20% of the GDP enough for an industry that's fundamentally a cost center of society? Wars have been fought over less.
When I went to the doctor about fatigue, the advice given to me was to stop exercising and take a break.
When my father went to the doctor about fatigue, they gave him a full blood panel and scheduled a cardiologist and respiratory therapist visit.
Which is to say I expect spending to go up just for demographic reasons of large numbers of people starting to care. Don't confuse this for thinking all is well with health care costs.
Answer this question, and you’re on the journey to the solution to the problem you are talking about. Tell me some BS why the question doesn’t matter or is wrong or whatever, and discover why “Dunning Kruger” is at least part of the answer.
I posit that the people who hold an ideology, moral compass, world view, or whatever else you want to call it, that permits the question to even be framed in this way are a root problem exacerbating many other problems in society, healthcare likely being one.
I don't know what the "solution" is but the fact that ~1:5 dollars in this country is spent on maintenance of the human body is just wild and likely unsustainable or indicative of some gross error in how we measure such things.
$40,000 cap would exclude all the therapeutics targeting rare disease being developed today. not just pediatric. all. it would exclude tirzepatide, which costs $250,000 to $400,000 for most people. if you want to cure obesity. and by the way, congress expressly banned paying for all weight loss treatments from medicare.
> Newly pregnant friends are spending $$$ on tests in utero to weed out children with such things.
do you think pregnancies at age 40 compared to pregnancies at age 20 are more expensive, or less expensive? define expensive, yes? and what price should the government pay? should it pay 40 year old mothers different than 20 year old mothers?
it's too bad that i'm being downvoted, since you're engaging with the question and hopefully it is really illuminating why there are no easy answers to capping healthcare costs. it starts with people, especially people who think of themselves as being very smart, being unable to specify a max price they are willing to pay, which is conceding that a market-based solution can exist but be very deeply flawed.
"Luxury homes", $3M+, are hot right now with prices risings. Whereas lower cost non-luxury homes are seeing less growth. It's a weird world.
I can't find the blog post from the last major recession where people were talking about all the crazy flavors you only see when the economy is REAL bad.
Couldn't believe how many people would go to the sushi restaurant at the base of the building and spend $25 on lunch a couple days a week. Yikes.
At the very least you should consider steaming some vegetables (also very cheap), slice them up, and mix'em in to get some moderate nutritional value from it.
https://www.health.harvard.edu/heart-health/whats-your-daily...
The problem with ramen is the amount of carbs and little nutrition which only spikes your insulin and makes you hungry 2 hours later if your metabolism is not great, not saturated fat in a vacuum. I wish popular knowledge about food had moved on from the misguided research of Ancel Keys already.
Getting lunch with coworkers once in a while doesn’t hurt
Also there's fairly wide variance in calorie count brand to brand for the same size square, not sure why.
https://www.heb.com/product-detail/15219522?shoppingStore=79...
Why do people cheap out on food, but spend that money on less important things? We're talking about your health here! It's even worse when people with high incomes do it.
Nothing fresh in them, high sodium, freeze-dried ramen or noodle bowls were originally survival food and should be treated as such.
Not saying don't eat them, and I don't know your socioeconomic background or anything, but if you want to eat them or have to eat them, try to add a little something extra into them.
A cup of shredded cabbage and/or a few cherry tomatoes and/or a half cup of onion slices and/or an egg, things like that should be cheap and easy to add and will help dilute the sodium and add a healthy component to the meal, and your kidneys and heart will thank you for it.
Until my blood sugar (A1C) and blood pressure numbers started climbing...
It sounds like a habit drawn from poverty, but frankly, you'd have to be really poor to reach for something like this daily (I'm talking extreme survival situations that even the homeless don't typically face). Those with low income can still get much better food at a reasonable price. They don't need to shop at Whole Foods.
I'm not sure you can even eat like this for very long either. The malnutrition is that bad. Expect high medical care costs or an early death down the line.
Penny wise, pound foolish.
But, odds are, the person who eats instant ramen 5 lunches a week isn't going home to a balanced dinner and likely eats fast food or frozen dinners most nights, which is why I suggested adding a few inexpensive extras.
A cup of pre-shredded bagged cabbage would add ~$0.50 to a ramen meal. If they do 30 minutes of meal prep on a sunday they could pre-portion a full portable soup container with all of the extras for the week and be ready to go for maybe an extra dollar a day.
Edit: The last time I worked in an office building, I had a limited time for lunch. I could have brought in ramen, or purchased something from the decently-stocked break room coolers. I could have sat at my desk or gone outside or eaten in the break room.
And sometimes, I did do those things.
But what I quickly discovered was that what I wanted on my lunch break was primarily a break.
I wanted to get the hell away from that place, surround myself with something completely different, and spend time relaxing my brain before getting through the second half of the day.
So I often went out to get lunch.
But because time was limited, it had to be nearby, and my options were thus very limited.
So I ate a lot of bargain-menu Wendys and tacos from Qdoba because I could get there, and eat, and relax a bit, and be back on time.
If there were instead a sushi place right downstairs, I'd have probably hit that once or twice a week, too. It would have had a higher monetary expense, but my brain would have thanked me for the extra time to unwind and I'd have had a better and more-productive rest of my day and come home in a better mood than I might have otherwise.
The problem is that this recent equities run has been extra terrible for more conservative 60/40 portfolios [0].
[0] https://www.morningstar.com/economy/6040-portfolio-150-year-...
There's an intermediate option: sell high P/E stocks and buy lower P/E stocks with dividend paying history. There are ETFs designed for this purpose too.
In particular bulking up in EM, EU, and small cap. And slimming down in us large cap.
https://www.washingtonpost.com/business/2025/11/24/sp500-sto...
Also, its possible that the market thinks job losses are good (aka that AI is replacing jobs)
Stocks go up, wages and income go down, things keep on keeping on because AI has quietly replaced you.
We can’t time the market, but we can protect the scraps we’ve accumulated at least.
The problem here is some waited for too long to be told we are now in a recession, then some politicians tried to redefine it.
But that is nothing compared to what will happen in the next 5 - 10 years. Nothing goes up forever. The only hint is that we need to prepare before 2030.
Housing is essentially a bottomless pit when the economy is good, it can sink any amount of money because it is an absolute necessity. So when people have money they'll use it to bid against each other for a scarce resource. But when the economy pauses or even starts to shrink then that surplus evaporates and one of the first indicators that this is happening is the demand for housing. Usually the result will be some price adjustments and after that it is business as usual. But if the cuts go deeper then there may be more substantial effects.
The only thing that is holding the US economy afloat right now is the fact that there are still a couple of levers of power that Trump hasn't gotten his fingers on. When and if that happens I fully expect things to go into freefall.