Re:Worker pay isn’t keeping up with inflation
by treis on Friday December 17, 2021 @12:30PM
(#29595342)
>What's the cost to get to that point? It used to 2x annual salary, it's now nearly 6x annual salary.
It's just not. You're not accounting for the interest paid over 30 years of a mortgage.
Re:Worker pay isn’t keeping up with inflation
by PaulDavisThe1st on Friday December 17, 2021 @12:50PM
(#29595613)
No, I'm assuming best case: zero interest.
You might be arguing that 1970's cost-as-multiple-of-earnings plus 1970-accumulated-interest exceeds 2020's equivalent. Is that your point?
Re:Worker pay isn’t keeping up with inflation
by TheCoelacanth on Friday December 17, 2021 @11:35PM
(#29601691)
That "best-case" is unrealistically favorable to the 1970s buyer. In 2020, you can almost get that zero interest mortgage. In the 1970s, you are going to be paying at least 10% on top of that.
People live in homes for their entire lives. If they decide to be owners rather than renters, over the course of their life (actually, typically somewhat less than their whole lives) they will end up mortgage free. This is an important component of most people's retirement planning, in fact.
What's the cost to get to that point? It used to 2x annual salary, it's now nearly 6x annual salary. That's 4 full years of earnings which vanish into owning a home. If you do not reverse mortgage or sell during retirement, you effectively "lose" this money.