Commentary — Modern Life: Priced Out of Existence?

in Proof of Brain2 years ago

Yesterday — July 4th — was Independence Day, here in the US!

But not only was it Independence Day, it was also the first public holiday with crowd events since Covid-19 restrictions were lifted here in our home state of Washington, on June 30th. Accordingly, people were out in force, almost as if we were emerging from bomb shelters after 18 months of "nuclear winter."


We went to the park with a couple of young friends of Mrs. Denmarkguy's; sat in the grass, watched thee fireworks.

Struck up a conversation with some people enjoying the sunny evening on a blanket nearby. Turned out they were recent transplants from the San Francisco Bay area; in large part, they moved here because US $600,000 for a single family home was "cheap," according to their frame of reference. Their 1,400sf (130 sq.M) zero lotline house in the Ingleside area of San Francisco had sold for US $1,400,000, and they were grateful to be out from under a $7,000 a month house (mortgage + taxes) payment.

I nodded understandingly, and went back to our spot... reflecting on the fact that Zillow currently "estimates" our own house to have a market value of US $785,000. Which, perhaps, one ought to be "pleased" with, but it leads to the deeper and more ominous question of "what happens to those of us — increasingly rare, it seems — who live in houses because they are our HOMES, not because they are an eternally flippable asset you own for profit?"


We put roots down here; we made the place a home and we continue to do so, always expanding our food growing space and reducing lawns.

We also paid a small fraction of our home's current value; cashing out our retirement plans, savings and loose coins from the couch cushions to buy the place outright with cash. The bank doesn't own it, we do. But that's all good and fine — on paper — but things like property taxes, insurance and various maintenance outlays aren't based on our initial outlay, but on current valuations.

The cumulative inflation since 2006 has been about 35%. But our property value has increased by some 330%, so our taxes have gone up from about $1,700 to $6,500. Our insurance from just under $600 to $1,700... and so forth and so on. Meanwhile, our incomes have stayed pretty constant. People were willing to to pay the equivalent of about $25/hr for editing services in 2006; they'll begrudgingly pay about $30/hr in 2021. Mrs. Denmarkguy's counseling/coaching sessions were $99 in 2006; today they are $120... and her clients moan, groan and grumble about "how expensive" that is.


On a greater scale — and I am not sure what sort of math is used for this! — we find ourselves having regressed (income wise) from the "middle" class to the "lower" class between 2006 and 2021, in spite of both of us being "fully employed" and now having to supplement with additional income from more small sideline businesses.

As I found myself having to pay our quarterly water bill with a credit card (it's always high in June and July because we're watering the garden), I also thought about the family from San Francisco we met at the park.

Truth is, they love San Francisco and all it has to offer, and really didn't want to leave, but they had simply been "priced out of existence," and were left with no other options but to sell and move. They, too, had found themselves slowly becoming "lower class" income wise... which in the Bay Area amounts to a $90,000 a year income level.

Sounded sadly familiar... and it also made me realize that "$100 a month from blogging on Hive" is reaching the point of mattering, as part of simply surviving.


Then I thought about the millions of people out there for whom the effects of Covid-19 restrictions being lifted will present challenges... it also means that eviction notices, foreclosures and late fees have come back into full force. How many will become homeless in the next six months.. finding themselves with mounting bills coming due, and less work opportunity than they had before?

Are we all just being slowly priced out of existence?

Thanks for reading, and have a great week ahead!

What do YOU think? How is the cost of living where you are? Is the cost of housing rising much faster than incomes? Is it becoming harder and harder to simply "stay in place?" Comments, feedback and other interaction is invited and welcomed! Because — after all — SOCIAL content is about interacting, right? Leave a comment — share your experiences — be part of the conversation!


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Created at 20210705 16:10 PDT



Water bills?

But if it makes you feel any happier, house prices in nz are a lot dearer again...

I live in a smallish well beat up 100 year old wooden house that would cost over US 1 million to buy at the current prices

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Yup, water bills. Lot more than in NZ... currently we pay US $299 per quarter, and that's "cheaper" because we're not inside the city limits where there's also a sewage fee.

The thing that mostly makes me shake my head over housing is that the pile of wood, concrete, wires and pipes needed to build these houses amounts to a tiny fraction of what they are supposedly "worth." So we're basically paying for "air," and evidently willingly so.

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Wow, even your lower cost of living makes me flinch. Look at what you can get for $250,000 in 78501.

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Without even looking, I'd guess that's a South Texas zip code; somewhere in the Valley? I lived in Austin and Round Rock for some 25 years; moved to Washington state to get away from the heat! But it's true that you get more for your money there, as far as property goes.

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That's weird, I thought you once stated you lived in the great lakes region and you moved out to Washington to get away from the snow.

You are correct. There are some IT people down here who mostly remote work. One developer I know works for a company in Austin. Remote working is more acceptable these days. It makes for good geographic arbitrage.

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Yes… thanks to places like ProofofBrain and Bitcoin many people will be able to afford things again.

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If not many, then at least some. It's going to take a while, though...

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I will definitely invite more people to join since it seems to be a very friendly place.

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Is the cost of housing rising much faster than incomes?


I do feel costs of living rise so much faster than income. For us, personally, it's not so much of a problem yet. We switched to a more expensive house, but I always make sure to leave a lot of wiggle room. We can 'survive' on hubby's income alone. We can live a comfortable life when I work aswell. The bank does own our house, but my goal is, and always has been, to pay these loans off faster than the 'standard' 30 years (and work less). Then, the biggest financial issue left is the ever growing home values, which results in ever growing taxes and insurances.

I dream of moving to another country at some point. One where prices aren't as crazy as here in the Netherlands. Just can't get hubby to join me in such an adventure, so I fear I'm stuck here.

I've been looking for over a year now, I want to go out a little ways from where I am at but finding rental property north of here is near impossible. I either need that or a place with enough land I could put another house, probably a modular, not mobile on. I want my kids to be near to debt free outside of taxes and insurance as possible when I die, maybe that will be the stepping stone needed to raise the family into a middle class style of living, at least I thought until now because prices even out a ways have doubled to tripled. My kids think the duplex is all good and well, they don't mind the city life but the way things are going city life won't be worth living if you have to dodge bullets, before it was just the quality of schools that were an issue. Right now one son lives in a good neighborhood with quality schools while the other lives a few blocks from me, he has sons but my other son has two sons and a daughter and I really worry about her. You can also see a distinctive difference in their education levels between the two families.

Watch out when paying bills and shopping with credit cards. They'll hike their rates up faster than you can think about it. We started to go under as the wife and I both lost our jobs back in 2008. I found myself having to pay bills and food with our credit card, and it went from low APR to extremely high APR in less than 6 months.

They see the trap and try to squeeze everything they can get out of you before you default. This is their rationale.

That being said if I were you I would sell up and move to bumsville nowhere. A nice quiet area of America that no-one gives a shit about and everyone still lives in the 1800's.

I holidayed to America back in the 2000's to visit my friends and they were in the middle of nowhere. I saw beautifully big houses going there for around $60k, when in any city they'd easily go for $1m plus.

If you're like me and seek to create some roots then go do it somewhere that pricing wont be an issue for a long time.

Same here in Canada. You can even get a place on Lake Huron or Lake Superior for almost nothing.
The most beautiful places in the world.



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In 1913, the Federal reserve system was created. Its policies of inflation and artificial interest rates have constantly enriched the connected at the expense of everyone else. We may be approaching a currency collapse, although that may be too "chicken little" of an assessment. There have been market signals of a recession for a long time, starting pre-COVID. Now we are seeing another asset bubble in housing like we saw in the early 2000s. Either a correction is looming, or it will be somehow pushed off until it becomes even worse.