You have to love the Orange County bubble. It is fitting that Disneyland is in Anaheim and actually has some of the poorest households in the entire county. You have a world of Princesses and fantasy and right in the same city you have topless dancing fulfilling a fantasy of a different sort. You have cities like Irvine where most of the new homes are selling to investors or foreign buyers. It is an interesting county. Yet a new report continues to show that California is no place for the middle class. The report also found that Millennials are leaving the area while Taco Tuesday baby boomers and older folks are the only cohort actually expected to grow in proportion relative to other age groups over the next 25 years. It is also no surprise that plastic surgery and expensive leased cars dominate the crowded streets. Unlike L.A. County that understands that there is a large struggling class of people Orange County seems to be in a fog when it comes to the deeper realities.
California homeowners are entering into their geriatric phase. The share of homes owned by older Californians has grown substantially since 2000. The Taco Tuesday baby boomer crowd is dominating the ranks of homeowners. This trend is new and because of key items like Prop 13 and Millennials living with parents, very few homes are turning over. The first time home buyer in California is simply getting older and older contrary to the house humping cheerleaders talking about the days of “sucking it up†and having to save to buy a home. Of course many were not contending with hot global money, limited inventory, artificially low interest rates, and a delusion of crap shack grandeur.  Now some yell from their beer belly exposed guts and a savory carne asada taco in the other hand that people should move out if they don’t like it here (and many are). The economics of course are more subtle.
The rental apocalypse continues in Los Angeles. It is interesting to see how far some house humpers will go trying to justify prices. Some are arguing future weed sales are going to create another boom which is somewhat ironic since the benefits are actually to mellow you out, not turn you into a Taco Tuesday baby boomer that becomes a cubicle stressed slave just to purchase a home. And many times people plan on having a family shortly after which means higher childcare costs which they tend to forget. However, Los Angeles once again continues to be the worst place to rent in terms of affordability (and own for that matter). Zillow put out some interesting research and of course as you would expect, those spending nearly half of their income on rent are simply not saving for retirement.
Los Angeles now takes the award for having the lowest homeownership rate for Millennials. As it turns out most young adults are either living at home with their Taco Tuesday baby boomer parents or are living like sardines in rentals. The options are limited short of forking over a massive amount of money and committing to living in a crap shack. You will have to eat rice and beans (and tacos) for a decade but at least you will own a piece of the California dream. That dream is clearly that – an illusion for most. The figures back this up. Of course the audience on this site tends to lean to higher income households and those with higher levels of education but the house humping rhetoric is still intense. Most realize that buying a home in the greater L.A. metro area is just one giant pipedream. Less than 18 percent of young adults own a home in the greater L.A. metro area.
Subscribe to feed
