House or Car Ownership is Something Most are No Longer Interested In
The newer generation is no longer interested in the ownership of a house or car. The millennial generation, as it is called, namely those between the ages of 30 and 35, find it more practical to rent, rather than to own. Some sociologists believe the main reason for this is the struggling economy, which makes them be wary of any financial loans.
But the real reason, however, is different. Things have changed a lot in the past few decades and are changing even faster with each passing year. This is why the older generation has a hard time understanding the newer one. With new technological advancements made on a daily basis, times are changing like never before. Every year looks different than the one before, something which has never happened since the dawn of man. And it will hopefully, continue on happening for the better in the future.
The main reasons for why the Millenials no longer see ownership as something primordial to their existence, are as follows:
A different Concept of Success
In recent decades the image of a successful person is no longer that of a, let’s say, local baron, with a large estate and a business of his own close by. Don’t get us wrong, though, because this still is a successful person, but no longer the model sought after in today’s world. Today’s people are all about mobility, and “property” has the tendency to suppress that. This is why many successful people today opt in renting a house, instead of owning it directly.
Why? Well, if a new opportunity were to present itself and it involved you moving somewhere else, a house or a car would make you have doubts or even reconsider altogether. In short, society’s perspective has shifted from prosperity through stability, to prosperity through mobility, flexible schedules and financial and geographical independence.
Ownership is no longer Financially Viable
We have reached a point in our development where ownership is no longer financially viable. For example, owning a car has a lot of, let’s say, “hidden costs”, which most people don’t usually take into account accunt when they buy one. For instance, there are taxes for simply owning a car. Then there are carbon taxes, road taxes, parking and so forth; things which really add up over the years.
Many people today opt to either take public transport (where it isn’t a time waster), bike, or even take a taxi. A cab is like owning your own car for a short period of time, which also comes along with your own personal driver. You no longer have to worry if you paid your taxes, or if you have a place to park. These things, of course, are included in the fare, but depending on how much you use one, the difference can be staggering.
The same thing applies to owning a house. According to a recent study by Forbes, the average young person changes jobs every three years. So, if you owned your own house, the only real options would be to work somewhere else close to home. Moreover, buying a house nowadays, almost certainly involves getting a mortgage of 30+ years (which in itself means that you’re renting, with the only real difference being that the owner is the bank).
The Value of Property can only Go Down
With very few exceptions, the value of an object over time can only go down. This perfectly applies to a car or even a house. A car’s price can drop by up to 20% just by buying it, without even taking it for a single ride; let alone use it for several years. Up until the 20th century, people had less opportunity to travel, to open their own business, and people were overall less connected around the globe.
This is why our parents had little choice than to spend their money buying cars and houses, and trying to mold their environment to suit their needs as best as possible. In today’s world, however, things have flipped on their heads, and people are free to travel and settle to any place that best suits them.
If we also take into account just how fragile the prices of real estate really are, and how quickly they can drop, literally overnight, especially in an economic crisis, it would definitely be less risky to rent than to own.
Ownership makes us Worry
It is a proven fact that when people travel, they become increasingly worried, depending on how much stuff they brought with them, or about the stuff they left home. Often times you’ll find people on vacation lost in thought, thinking whether someone broke into their house, stole their car from the street, or if they left the oven on.
Or what about your cabin in the mountains? You only go there once or twice a year, after all. Who knows what happened to it since you were last there? But regardless of what happened to it, at best it will be exactly as you left it. Then why not rent someone’s place through AirBnb, or something, and visit a different place every year, without all the hassle and the worry?
There is a quote out there by the novelist Chuck Palahniuk: “The things you own end up owning you. It’s only after you lose everything that you’re free to do anything.”
Unlike ownership, Experiences can only Increase in Value over the years
As we mentioned before, things tend to break down and decrease in value the longer we own them. So, with very few exceptions, we will never get back what we initially invested, or had to periodically invest over time. Not to mention the fact that these things make us think about their wellbeing regularly, not allowing us to truly enjoy our time.
Experiences, on the other hand, have nowhere to go but up in terms of personal value. Even bad experiences have a tendency to “grow on us” as time passes on. Moreover, experiences also tend to make us happier because we are less likely to measure their value by comparing them with those of others. One can’t really say the same thing about material ownership. While we generally compare our experiences with others we previously had, we usually tend to compare our car or house with those of our neighbors, or even celebrities.
As this graph here shows, people are also more excited, happier and more pleasant to be around when they’re about to go on a trip, than when they’re about to buy something. All of these seem to be counterintuitive since a trip is for a short period of time, and after a week or two, it’s gone. Whereas a couch, a new phone, or a car, last a lot longer.
But as most of us have already realized, we tend to lose interest and stop appreciating things we’re constantly exposed to. We may be extremely careful with our new iPhone for the first several weeks or so, but after a relatively short while we find ourselves throwing it on the bed or couch from 10 feet away. The same thing applies with pretty much everything else we own; again, with very few exceptions. Another key element experiences often times bring into our lives are new friends and connections; something which material possessions rarely do.
Following this kind of lifestyle can, of course, have its own series of drawbacks, especially if people aren’t careful. Going down this road doesn’t in any way mean to not have a plan put in place for when you’ll not be as mobile as before; that’s simply irresponsible, not independent.
By putting something aside every month can more than make up for when a person reaches retirement, either by continuing to rent, or by buying a small flat or house when the time arrives. With a small degree of foresight, these problems can easily be overcome or avoided completely.