It seems odd to extrapolate to the entire world's population of adults, yet rule out the possibility of living anywhere that houses cost less than a million dollars.
I suppose the issue here is that the "wait and save" approach does not always have success, especially in the Bay Area.
The reason for that is because there is a finite number of houses, and an excessive number of bidders. These bidders use loans and leverage (other people's money) to pay a higher price than they normally would be able to afford.
Thus, waiting and saving is tougher.
Of course this begs the question, why not just avoid the Bay Area?
Unfortunately, most of the tech jobs are there. Other cities don't have the job capacity, despite having plenty of houses.
So, finally, there really only are 33m people on this Earth who can afford to pay cash for a home in the Bay Area.
The rest have to leverage, and thus, are affected by identity theft and credit scores.
I can just tell you, respectfully, as someone who has a successful career in tech far from the Bay Area, that it comes across as obtuse to presume one can't work or buy a house anywhere else.
Your comments imply Bay Area housing costs are the default, but they're not. They're the exception. Contrasting the number of global millionaires with Bay Area housing costs in response to a general statement about saving to buy a house is silly.
I'm not sure how realistic it is to save for instead of getting a loan for a house, but I started my career 30 minutes from a city in the US with an international airport. I got a mortgage, but the house was $117k, in a safe neighborhood, with a garage, three bedrooms, and 2.5 baths. There is a whole world outside the Bay Area.
How much job capacity do you personally need? Isn't it enough to have just one job? Many cities have that and more, and it only takes one job to support a family.
I hope you don't expect to lose your job every few months, but in case you do, remember that new jobs pop into existence. It's not like a city with 100 jobs is on the verge of running out. (several years later: "oops, the last job got used up in 2018 and we can't ever make any more; this city is all used up")
I've had my tech job for a dozen years now. It pays well enough to get a 3500-square-foot house on half an acre and feed a huge family, even though the pay is perhaps only 2/3 of what I'd make in San Francisco or Mountain View. The 5x to 10x difference in housing cost more than makes up for the salary difference.
Improve your skills, increase income, invest and save, live with roommates, learn that consumerism is programmed into people through TV ads and thus is completely unnecessary.
Mr. Money Mustache[1] has been blogging about this for years, and it's a great place to start for people who don't understand personal finance. Also check out the personal finance[2] and financial independence[3] subreddits.
Although that's allcompletely good advice for everyone, the facts on the ground are that we can't all be rich. The majority of rich people are the beneficiaries (either directly or indirectly) of an inherently exploitive system. A trivially small number of them actually added true wealth to the world equal to or greater than the wealth they've captured.
I didn't mean "in reality, we aren't all rich", I meant "in the reality of our economic system and the way it works fundamentally, it is impossible for us to all be rich."
Whatever possible route there is to everyone being rich, it involves a fundamentally different economic system. Socialists would have you believe they have the answer to that, but there's good reasons to be highly skeptical. Capitalists don't pretend to have the answer, they (generally, there's lots of variations of "capitalism") openly accept that we need some people to be rich and others to be poor in order for the system to operate.
I used to try to live according to Kant's Categorical Imperative where I would aim to be the example for the world I want to see, the one where everyone would prosper if they all behaved as I do. Then, I realized that was just a delusional way to think. It's an interesting philosophical question to discuss, but people don't all act as I do in reality, so acting as though that fantasy were real is often totally counterproductive or self-sacrificing with nobody benefiting. Reality is complicated and complex.
> of an inherently exploitive system. A trivially small number of them actually added true wealth to the world
And I agree, not everyone can be rich, but on an individual basis it's not that hard.
The good thing about capitalism is that the average quality of life gets elevated. The rich do get richer (which we shouldn't focus on) but poverty also gets eliminated at the same time.
And yes, as you say, people won't act like the utopia we'd like, so it's not perfect. But it's better than anything else by a long shot.
Well, yeah, that's the difference between micro and macro. In a free society without a nobility or class system, it's possible for any one individual to rise from poverty to privilege with luck and hard work. But if it's a zero-sum game where one success is another's loss, then "being the example" isn't an example of anything, it's just being the winner instead of the loser. Of course, most success isn't entirely zero-sum, but it has too many zero-sum elements far too often and is also too-often entirely zero-sum. And some people try to ignore the entire issue of when or whether or how-much some success is zero-sum.
> The good thing about capitalism is that the average quality of life gets elevated.
Crediting "capitalism" here is entirely dubious. The correct credit goes to technology and innovation. There's nowhere near adequate evidence to conclude that capitalism itself automatically increases average quality of life. Perhaps you are mistakenly lumping all of trade and markets with "capitalism"? Markets are often positive for everyone, and trade is generally positive for everyone, raising everyone's quality of life. In our society, probably because of propaganda to this effect, people consider markets and capitalism synonymous sometimes, the same semantic way people in some contexts might consider "moral" and "religious" (or even "Christian") to by synonymous.
In short, if you're just saying that markets and trade benefit everyone generally (but not necessarily), then we have no disagreement there.
You're looking at the cost of Bentleys and wondering how most people afford a car. They afford it by buying used Honda Civics.
Which is to say that there are job opportunities in Dallas and Indianapolis and Atlanta and so on and so on, which are all cities with the housing equivalent of Honda Civics.
If you insist on a Bentley (i.e. the largest coastal cities), then I guess I just don't know what to tell you except that you should reconsider a visit to the Honda lot.
1. You don't need a $100k per year job to buy a house.
2. Easy way = not spending but rather saving. It's simple, but not fun in the short term.
3. House too expensive? Save more or buy cheaper.
4. 2007 loan crisis. I.e. don't buy a house that's too expensive.
What can Money-Moustachism do about the fact that the well-paying jobs are increasingly concentrated in a few cities on either coast? Is the future that everyone becomes a down-at-heel rentier just like he is? Are we all supposed to be cheap John Arillagas living off the people who do actual, productive work?
You can buy a house with no credit history. Look it up.