You’ve probably heard of the interview on Australia’s “60 Minutes” featuring an Australian millionaire (apparently, the family-assisted kind and not the self-made kind) admonishing millennials for their avocado toast habits, which are preventing them from becoming home-owners. If you just read that sentence, this sounds like the tone-deaf spewing of an out-of-touch elitist. And if you read most comments on Twitter (I know, I know, was this my first mistake??), you’d think that Tim Gurner had blamed young people’s obsession with breathing air as the reason they aren’t real estate barons. Comments range from the cheeky to the outraged, but these anti-Gurner comments all have one thing in common – they summarily dismiss his argument that millennials/Generation Y are partly to blame for their lack of home ownership.
At the core of his comments is the idea that you can’t have it all.
If you spend on fancy brunches, and splurge on vacations, and dine out constantly, then don’t expect to be able to afford a home. But he was an easy target for snarky 20- and early 30-somethings everywhere, many of whom were NOT the focus of his comments but were the first to jump to irate conclusions. The most-peddled retorts involved adding up the cost of a daily avocado toast and explaining how it would still take years and years to save for a down payment.
Now, if you never dine out, if you never vacation, and if you save as best you can, you still may not be able to afford a home. Maybe you’re one of many young people saddled with a mountain of student debt, maybe you’re struggling to find a well-paying job in the field of your interest, or maybe you live in an area with outrageous property costs. These are all well-documented hurdles, there is no denying that. Had Gurner been pressed on these points and still maintained “Those are all just pathetic imagined excuses, it’s the goddam four $4 coffees at one sitting that I talked about!” well, then, we could all string him up. But one of our problems is that we tend to over-simplify issues so that we can more easily fit them into our worldview and then either agree or disagree.
Just because he says one thing may be a cause, that does not mean he denies the existence of other causes.
It’s not just the young Twitterverse up in arms; media outlets have piled on in our culture of indignation, like this NY Times “fact check.” A lot of us don’t open ourselves to the other side enough, or admit when we’re wrong. I’ll admit I went into this NY Times piece looking for a fight. I had already decided that people were generally over-reacting, and that I was going to hate this fact check. But I read it and I forced myself to consider its points. Things I agree with:
- Purchasing a home is not always the most prudent financial decision, so we shouldn’t automatically assume that being a renter (or even living at home) signifies failure
- It’s really hard to save up a 20% down payment
Where this piece goes awry is where it chooses to get TOO specific, and where it tries to force comparisons without considering other variables. There’s this:
The truth is, even if millennials assumed the eating-out habits of baby boomers, it would take around 113 years before they could afford a down payment on a home (assuming a 20 percent down payment on the median price for a home in the United States, $315,000 in March 2017, and a 1 percent yearly yield rate).
I don’t question the figures, but I question the narrow focus on just dining out. The spirit of Gurner’s comments was that “expectations of younger people are very, very high,” implying a general pattern of spending frivolously. The example above is an over-simplification, because even Gruner would certainly not think that just cooking your own meals is enough to save for that down payment.
Then there’s a whole section comparing spending data from millennials with data from Gen X and Boomers. On the surface the numbers tell a story of millennials not spending much differently from their Gen X and Boomer counterparts. But to me, that is exactly at the root of Gurner’s point, and is also, well, comparing apples to avocados. The NY Times piece shouldn’t even take itself seriously with this sentence:
Millennials spent $4,832 per year on vacations, just below the $5,078 by Gen-Xers and $5,012 by boomers, according to MMGY Global’s Portrait of American Travelers in 2016. The study surveyed 2,948 adult travelers with annual incomes over $50,000.
They are attempting to argue that millennials really aren’t spending that differently from other generations, but this doesn’t take into consideration some very big variables. How much “over $50,000” are we talking? What percentage of the Gen-Xers and Boomers are home owners (i.e. already have a house and don’t need to save)? Gurner’s comments describe saving and being frugal at the outset of your adult life, climbing the ladder, etc. If, right out of college, you are spending almost as much per year on vacations as your parents, to me that says you are not taking saving seriously, and you shouldn’t be surprised home ownership is out of reach for you.
Gurner was not asked to describe, in full, the plight of all young potential home-buyers. He gave a reason that some young people have been challenged to afford a home, not all the reasons. But that matters not in our knee-jerk reaction society. The frugal-minded 26-year old living at home working an entry level position trying to save up for a home who enjoys brunch every now and then? Chill the f out, this was not about you. The 26-year old in a high-rent urban apartment drinking champs with their pals every weekend spending $16/month on a curated underwear subscription? Wake the f up, because this was about you and maybe you need to start sharing some of the blame.