- Many millennials are cheering for a housing market crash on Twitter. They say it will help them afford a home.
- But they seem heedless of the damage it will cause to current homeowners who face stress and tragedy of foreclosure and displacement.
- There’s a way for millennials to afford a house of their own whether there’s a housing market crash or not. Work for it.
Since the economy took a turn for the worse, there’s a growing number of millennials cheering on a housing market crash.
They’re hoping for a housing market crash so they can afford to buy a house. There are now an extraordinary number of tweets on the Twitter timeline like these:
This engineer and University of Michigan alum says she’s waiting:
But this millennial thinks she can’t wait:
Another exhorted fellow millennials to start saving up:
This millennial is hoping the housing market loses half its value:
While this one is literally begging for a housing market crash:
The prevailing attitude of those raising this cry is strikingly blithe:
It’s almost like these millennials feel entitled to a housing market crash. But they’re entirely naive about how many people will get hurt if that happens. Or they hold that possibility in callous disregard. Because they’re not just greedy for homeownership, they envy and loathe homeowners for having something that they don’t.
A Housing Market Crash Would Wreak Havoc
If there’s another housing market crash in 2020 or 2021, it will send ripples throughout the entire economy with effects that last for years.
Firstly, it would displace millions of Americans from their homes. In the 2008 housing market crash, some 10 million Americans lost their homes.
Meanwhile, 9 million Americans lost their jobs. Moreover, 46.5 million Americans were living in poverty within four years.
The emotional trauma ran deep, leaving scars that people still carry today. The sense of failure, fear, and hopelessness over the housing crisis was pervasive.
Then there would be a vicious cycle that drags more American homeowners down. As home prices plummet, more homeowners will be “underwater,” owing more than their houses are worth. That will make them more likely to default.
In 2008 a flood of bank-owned houses destroyed the market value of other houses, creating a spiral of declining home prices and more foreclosures. Homeowners that fell behind on their payments ended up losing their homes.
Finally, the credit markets will seize up as a housing market crash spills over into another financial crisis. That makes borrowing money more difficult and more costly for individuals and businesses that need it. The result is an economy frozen in recession with a slow, arduous path to recovery ahead.
A Better Solution for Millennials
Last November, CNBC interviewed a millennial journalist– living in expensive New York City– who paid off $102,000 in student debt in six years while working a job with a $40,000 salary.
In the home stretch, she paid off the final $32,000 in eight months while paying the rest of her living expenses. She says she did it by sacrificing some personal time outside of work. Instead of loafing on the couch with Netflix or socializing, she took up side hustles. She did dog walking, cat sitting, babysitting, and freelance writing.
Any millennial with ambitions to own a house shouldn’t be cheering for a housing market crash, even if one is imminent. They should be working as hard as they can so that they can save up to afford the house of their dreams in whatever market they find themselves.
Disclaimer: This article represents the author’s opinion and should not be considered investment or trading advice from CCN.com.