Are you about to lose your home? Car? Family? Oh, no!

This was in 2014. At the time, we were still somewhat “fresh” on these shores and as such, we were still renting, but we were looking to buy a house.

It wasn’t so much about me and it wasn’t so much about rent basically meaning “wasted money”. As far as I was concerned, I could live in a cardboard box, provided I could seal it at night. Men, you know. My wife, on the other hand, viewed things differently.

Long story short, she “found” a house and she scheduled a viewing. The house was on the outskirts of London, but with “somewhat decent” connections to various places of interest (our jobs and a few other places). The listing price was 370k.

I didn’t like it. It had an extra wall built in the living room, in a stupid attempt to “add” an “extra” room. The original living room had been twice as large; it was now half the size, of course, but an extra “sitting room” had been “created” with that wall. It had this weird TV with a very small screen mounted on a wall, at the very top, making it highly impractical to try to watch anything on it. The original kitchen had been torn down and another “bedroom” had been “created” in there. As for the new “kitchen”, the owner had built an annex right outside, in what people here call “an L-shaped extension”. The garden had a shed that looked like it wasn’t going to withstand the next moderate storm at one end. It also had an outhouse in the middle of the garden, clear testimony to the fact that house was much older than us.

In short, I struggled to find anything good about it. The kitchen in particular was a problem – the insulation was very poor; we viewed the house in April and it was bloody freezing in there.

This was what they called “an open home event”. Simply put, you don’t get a viewing slot for yourself – like 15m to walk around the house and form an impression. Instead, you’d have every interested buyer showing up at the same time and walking around. This was not normal for me. It’s not how things happened where I grew up. At the same time, it gave the potential buyers an idea about the size of the competition – assuming, of course, they were “real” viewers; at some point, a certain estate agency had been caught red-handed; they were sending employees to pose as would-be buyers in order to create a fake bidding-war.

Naturally, I shared my concerns with my wife. But my wife was more optimistic than I could ever be. That wall? We could take it down. The kitchen? Pfft, we can fix the insulation problem. The outhouse? Well..we can probably get rid of it. Of course, all of these meant “money”. More and more money to be spent on it. I can’t say I was too convinced, but you know how these things go – happy wife, happy life – so I eventually agreed. Fine, we’ll make an offer. How much should we offer?

Well, she said, you’ve seen how many people showed up, so we can’t just offer 370k. We’ll have to go over that. FINE, HOW MUCH? I don’t know, she said, maybe throw in 15k more? My take-home pay was around 4000/month at the time, so I can’t say I was happy to hear that. But again, FINE. I wrote to the estate agents and offered 385k. I kind of prayed they would get a better offer.

They did. The estate agents replied a few days later, letting us know that someone else had already offered 450k. If we wanted to bid more, we could. Uh…no, thank you.

This was common in London. Any house with a few bedrooms would be seen as a potential HMO investment, although most of them wouldn’t really get the necessary paperwork for that kind of thing. So we were “priced out”. How unfortunate (insert evil laughter here)

A few years later, we bought this house. It involved getting a mortgage. It took us a few years, but we paid it off. We are debt-free. The “secret”? We bought a nice home in a nice town, but NOT in London, I took a series of well-paid but risky (and “toxic”) jobs, a gamble that eventually paid off. My wife progressed a lot in her career as well. So we’re “fine”. I’ll be honest here, I hated every single moment I spent at those jobs. I don’t use the “toxic” word lightly, I’m not a gen Z-er. But I felt that I HAD TO do it. Simply put, the thought of owing hundreds of thousands to a bank kept me up at night. I was determined to do everything I could to be debt-free.

When we got the mortgage, we agreed that the monthly payment shouldn’t be higher than 15% of MY income; not our combined income, mine. The reason for it? What if we have children (we did) and she’d be unable to work for a while? What if she lost her job? What if I lost my job? We did the math and that’s what we came up with – which was the exact opposite of what everyone else did. Because everyone we know simply went and bought the most expensive house they could; if a bank gave them a mortgage promise of 1M, they’d go and buy a house “worth” 1M. In their own words, a house was an investment. You pay 1M now and it will be worth 10M by the time you retire; you then sell it, buy something else for 1M in the countryside (because you’re now retired and you no longer need to live close to work) and you just pocket the other 9M. Easy win.

Of course, things rarely work out that way. Don’t get me wrong, sometimes they do. Other times…not so much. Sometimes, what happens is that 3 years into your 30y mortgage, the Bank of England comes up with interest rates close to 5%, up from 1.5%. It may not sound like much, but here’s the math.

Situation A:

You buy a 500k house using a 50k (10%) deposit on a 30y mortgage, with a 2% interest rate (realistic at the time). Your monthly mortgage payment is around 1664.

Situation B:

You buy a 500k house using a 50k (10%) deposit on a 30y mortgage, with a 5% interest rate (realistic in 2025 in the UK). Your monthly mortgage payment is now 2416, a whole 800 pounds more.

Situation C:

You buy a 500k house using a 50k (10%) deposit on a 30y mortgage, with a 2% interest rate (realistic in 2018 in the UK). Your monthly mortgage payment is now 1664. It’s 2023, your fixed term expired, the bank raises the interest rate to 5%, so you now have to come up with 2400/month instead of 1600. Post-covid inflation (generously helped by governments around the world handing out free money to everyone and everything) kicks in, so the cost of living goes up. The war in Ukraine is blamed for the high energy costs, which in turn make everything more expensive, because everything we use involves using energy in some capacity. AI-bubble fueled fears lead to seemingly unending rounds of layoffs at various companies, so your wife loses her job, assuming she had one. Various form of automation meant your also lost your job; fortunately, you managed to find one, albeit with significantly worse pay. Trump’s ideas also mean that more and more US-based companies are withdrawing from various countries in Europe, leading to even more layoffs. Growth is basically a wet dream, so you don’t really have better options. The 10 recruiters who used to call you twice a week are gone, probably unemployed as well. You suddenly can’t afford that house anymore.

As for cars…I just opened reddit today (honestly, I was going to open a specific subreddit, something technical, but I forgot to type the r/whatever, so I was sent to the “home page”). This was the first post I saw:

(link to that thread, but I wouldn’t be surprised if it gets deleted…)

You know, when I bought my car (a BMW, it was new at the time), it was around 400/month, with a final payment of 10,000. The total price was around 35,000. I paid it off since, of course.

Well, since then, the price for the same “series” type of car went up to 50,000. This was baffling to me for a while. “So let me get this straight, jobs became scarce, wages went down, the cost of living went up and the price of a car went up by almost 50%? What the actual fuck? Who’s buying them?”. Because, you know, it’s supposed to be a free-market economy – and in a “free-market” economy (spoiler alert: there’s no such thing), offer and demand dictate the price. So if a manufacturer tries to sell a car for 50k and there are no buyers, their only choice is selling the car for less. Come up with a 5k discount and test the waters, see if there are any buyers. No buyers? Alright, come up with an attractive loan scheme, see if there are any buyers? Still no buyers? Sell it for 40k. Then less, if you still have no buyers.

But what if you DID have buyers, even though they couldn’t afford that car? Full speed ahead in that case – try getting 52k or 55k for the car. Why not? After all, a company’s purpose is…profit. They don’t have a “social mission”. Their only purpose is to profit.

Some years ago, during one of those “toxic” assignments I mentioned, I lived in Stratford. The best description for it would be …”a shithole”. But that shithole was close to a railway station, with a Central Line connection, so that was that. Each day, I’d pass by a somewhat derelict tower (or, as Americans might call it, a “project”): the Unex tower. As I’d walk past it on my way to the railway station, I’d also pass by a sea of tents. Homeless people found shelter under a bridge there and well, they lived there. When it wasn’t completely freezing, you could sometimes see them having sex or relieving themselves (“flash” news: no, not peeing). Dodgy blokes on bikes handed you flyers describing the local prostitutes. Call whatever-number for a good time. Sometimes you’d see syringes on the sidewalk. No doubt, someone was really into donating blood. On my way to work, I’d also wave to Tom – a local beggar; you’d always find him begging there, on the bridge leading to the Westfield shopping centre. I’d carefully slip past the omnipresent black pickpockets the police somehow never managed to notice, past the Eastern European busking boys and that would be it.

With those things in mind, I was quite surprised when I found out the listing price of a flat in that tower: 600k. I couldn’t help but wonder “who the fuck would borrow 600k, probably paying over 1M in the process (with interest, that is) to live next to the homeless and to junkies? YOOO, WTF???”.

The answer is…the same type of person who lives with their parents and gets a 1400/month car at 21 (or 18, if I’m reading that right).

It’s people who either don’t understand how lending works, how interest works, what “affordable” means .. or people who are gambling. It’s not so much that they think the flat is worth 600k. They just think that by the time they sell it, it will be worth 6M. How to become a millionaire 101, you know.

It’s quite the bet. If it works out, they’ll look down at me and say “well, *I* was SMART; I bought the most expensive house I could get, because I KNEW it would be worth millions one day; I took the risk, because I was a REAL MAN and here I am with my millions; it’s not my fault that idiots couldn’t put 1 and 1 together”.

If it doesn’t work out, if they stand to lose it, they’ll blame everyone and everything – except themselves. It’s the economy. It’s AI/automation; it’s the job market; it’s the fucking government. It’s not MY fault, SOMEBODY help me! Have some empathy ffs!

The thing is, I’m all out of empathy, sympathy and everything else.

Because one thing these would-be millionaires, these “keeping up with the Joneses” fail to take into account is the effect of their actions.

Right, Johnny-boy, you bought your home for 1M and you’re going to sell it for 10M 20 years from now. Easy 9M profit. Now tell me, Johnny, do you have children? How are they going to be able to afford to pay 10M for a house? Because if yours is worth 10M, well, what are the rest of them worth? How many children do you have? What about MY children? Sure, if you’ve got one child, you can just give them the 9M and pray they can handle the last million; as for your retirement, thoughts and prayers, I guess.

Whether they realise it or not (my bet is that they don’t even think about that), their actions make life harder – MUCH harder – for the rest of us, the ones who do try to be somewhat calculated. Nobody gives a shit that I’m debt-free. If I need to buy a car, I’ll have to pay 50k. Why? Because there’s an 18 y/o somewhere who’s willing to take on that kind of debt for a car. If I need to buy a house, I’ll have to fork out 500k. Why? Because, again, there’s someone who’s willing to “pay” (actually “borrow”) that kind of money. Whether it’s because they can’t do math or because they don’t even think about the risks is irrelevant; whether they end up owning the house or losing it is once again irrelevant. Banks don’t care. Sellers don’t care. They’ve got an offer for 500k; beat that or beat it, my man. It is what it is.

Yes, it’s the same with everything else. The price of a holiday is high because someone thinks it’s a good idea to pay for it in 24 monthly installments starting next year (with a small 7% interest rate, of course). The price of a phone is high because young people are happy to uber/doordash/whatever to pay 100/month for a fucking phone they’ll dispose of in 2-3 years, when it’s no longer cool. The price of everything is high because people are paying for it with money they don’t have.

So when I see those reddit threads, the first thing that comes to mind is “oh, you want advice NOW; right, grab some rope and a bit of soap…”.

I don’t hate you, guys, if you’re in that camp. I don’t envy your bigger, more expensive house. I don’t care about your latest gadget. Of course, I know that I’m being robbed blind mostly because of YOUR actions, but I don’t hate you. At the same time, I’m all out of sympathy. Yes, yes, I do realise that you’re going through a difficult time. No, I don’t want to make it even more difficult for you. But you’re fucking things up for the rest of us, so I’m not exactly sorry when you crash. Good riddance – there are plenty of other people just like you ready to take things further, ready and willing to make life harder for us. You won’t be missed – simply because nobody will notice your absence. By the time I hit “publish”, 10,000 other people will have signed auto financing agreements they don’t even understand and mortgages they can’t afford. Some of them will have bought the house you can’t afford anymore and the car that was towed away one hour ago; the one that was “yours”. Don’t hate them. They’re just like you – except for the “broke” part.

For now.