Newsflash, Millennials: No More Avocados For You

You might think that the incredible housing squeeze on young people is unique to your area. Your city. Your country. I’ve lived on four continents and travelled the world every year since 2007. You’d be wrong. It’s everywhere.

This piece got picked up by Economy.com, a group dedicated to making economics more accessible and interesting for the average person. Please see the version on their online magazine here. 

Unfortunately, I was born into one of the craziest places for this trend. I was born in 1987 in Boulder, Colorado, USA. I’m in town visiting, and the house to which my parents first brought me is the same purple colour as it was then, on a busy corner near to Pearl Street. I dared to look up property prices in the area. That may have been a mistake. It sold for $106,300 in December 1989. It’s now worth about $750,000.

My parents recently received their updated property price assessment in the mail last week. In two years, the total amount that the tax office estimates my childhood home is worth went up $114,000. In two years! A 19% increase. Crazily enough, this year is not an anomaly. I know people who pay less in New York City for rent than in Denver! In the last six years, property prices and rents in the Front Range of Colorado have gone up at least 50%.

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Longmont, Colorado

That’s almost two times higher increases than in London, to put it in perspective. I lived in London from 2013-2015, and I know firsthand that affording rent is tough in the city. My husband and I got married during that time, and we shared a house with seven people in Leyton. For one room in a house with but one bathroom, we paid £630 (about $1100 at the time) per month.

In France, affordable housing is a major issue among young people, driving 40% of them into the arms of Le Pen during the last election (she promised more affordable property). In Korea, there are somewhat-artificial housing booms, with older neighbourhoods being knocked down and huge, hive-like apartment buildings rising ever more numerous in even small cities. In Australia, property prices in already-basically-impossible to afford Sydney are up 20% just in 2017 (nationwide, 12.9%).

That stream of numbers directly impacts the lives and wellbeing of younger adults. Just 34.1% of ‘Millennials’ own property in the USA, a record low. Everyone is scrambling to blame something for that fact.

The last couple of years have seen paroxysms of worry-journalism about young adults not buying property (I counted no fewer than 10 ‘What if Millennials Never Buy Houses?!’ headlines from just this year in major publications). An Australian property tycoon recently said the young can’t afford to buy houses because they’re spending all their money on $4 coffee and smashed avocados.

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In a certain sense, albeit deliberately twisted from his original meaning, Tim Gurner is right about his own generation.

Do millennials really spend more and save less than previous generations? According to some measures, yes! But it is important to put the spending in context, specifically in the context of wages and purchasing power.

Due to inflation and changes in the real cost of buying things, real wages have stagnated or even fallen in real terms for decades. Some argue that stagnant wages are a temporary by-product of Brexit, but that is just not borne out by the data. If you want to find out how much your wages would be worth in a past year, use a cost of living calculator online.

If I had the same salary in 1987, it would have been worth more than double its 2017 value in real terms. Yet many industries have not increased wages, with many in my generation stuck in the $20,000-$35,000 range. In the UK, real wages have fallen 10.4% since 2007.

The only OCED country with an equal precipitous decrease over that time? Greece.

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This is how Greece felt about that. Courtesy of CNN.

What is the price of houses in relation to average earnings in comparison to previous generations? The answer may make you swear aloud and scare your relatives, like I just did while researching this piece. Let’s start with the incredible increases in basic commodities prices, as shown by the price of a pint.

In 1982, you’d have paid 73p for a regular beer in a pub. Thirty years later, the 2012 price was £3.18 on average (and approximately £25 for a craft pint in London…). That means in 2012 you’d have needed £299 in your wallet to have equal purchasing power to £100 in 1982.

£100 = £300 

Because Economics. 

Average wages in the UK in 1982 allowed for a relatively high number of people to get on the property ladder. The average house prices were lower when compared to income. By contrast, in 2017 the comparison stands at 3.5 (meaning that a mortgage would be for 3.5 times one’s yearly income).  EDIT: Guys, I was wrong. FullFact.org informs me that the numbers are considerably worse. According to the government’s own research:  

In 1997, house prices were on average around 3.6 times workers’ annual gross full-time earnings, whereas in 2016 workers could typically expect to spend around 7.6 times annual earnings on purchasing a home.

That’s worse than in the depths of the Great Recession.

In Sydney, which is too expensive even for the billionaire investor who spouted that avocado quote, housing costs (rent included) are up 70% in the last five years. Wages are up only 13%. The gap between earnings and property prices is big, and growing wider.

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Young people are considerably more saddled with student loan debt as well. Comparing those who graduated in 2002 to those in 2015, more than 70% of graduates were expected to never pay off their loans. That’s a big difference; half those from 2002 have already paid theirs off. In 2004, 57% of those aged 25-34 in the UK owned a house. In 2014 (most recent data), that had fallen to 37%. Economists and real, actual young people alike cite student loan debt as a major factor in the lower numbers.

So yes, young people aren’t saving money as much as previous generations and they aren’t buying as much property, either. It’s hard to save when you’re trying to cover the basics, living paycheck to paycheck as many young people do.What Gurner and other critics seem to be saying implicitly is that young people should sacrifice even more.

Many of us do. In desperate attempts to turn hard economic realities into a ‘lifestyle,’ many people under the age of 35 have created identities that soften the blow of being poorer than their parents at this age, if not outright glamourise low-income life. They apply trendy labels to their economic struggles like, ‘minimalist.’ That might reasonably translate to ‘I can afford neither nice things nor a place to put them!’

Vintage recipes, based on rationing and the shortages of the Great Depression are all the rage among young families.

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$5 Icelandic black caviar on a hot dog,
Tim Gurner. What now?

Tiny houses are huge, with the low pricetag as a major draw. Alternative housing (sharing, coliving, community shares, digital nomdism) are redefining what ‘home’ can mean for people under 35. It’s not all bad, but it is mostly a departure from the expectations with which we were raised. For many, including this Millennial writing from her parents’ house in suburban America, there is a pervasive sense of shame connected to money and saving.

Our economy does encourage young people to save, rather than spend. We know that we should be putting away a fifth of our income for retirement, but since more than a third of it is going on rent we can’t. We feel the guilt if we treat ourselves to a couple of beers at our favourite brewery. We put off marriage, children, buying cars, and getting out of jobs that we hate because we have the financial equivalent of The Fear of God in us. We try our best to mitigate the after effects of the Great Recession, all tempered with the real-world experience to know the next big crash is coming. We want to save, but many of us just can’t.

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A typical Millennial Apartment in South Korea – 190 square feet

All those traditional markers of adulthood that used to connect us to society at large are changing. In many cases, they can still be achieved with relative ease. For more young adults, they seem difficult or even insurmountable. The last god damned thing those of us in these circumstances need is a billionaire complaining that we don’t save enough. He didn’t save the $34,000 he used to make his first investment. It was a gift to him from family! There’s nothing strictly-speaking wrong with getting financial help from family, but it is not the same as saving every $4 coffee.

There is certainly a tendency to blame young adults for our own financial burdens. It’s possible that many of us are making poor choices, but that would not distinguish us from any previous generation. The truth is that the economy is changing, has changed, and is not benefitting all of us.

I look forward to my £11 pint in the year 2047, when the house I was born into will cost $4.7 million and I will have finally paid off my London master’s degree. I’m only half-joking.

Ten Easy Steps to Find Your Apartment in Shanghai

This guide is based on my experience as a TEFL teacher in China.

Beyond getting a Z visa for legal work, the prospect of trying to find and rent an apartment in Shanghai immediately after arrival was the most stressful part of moving to China.

We had just under two weeks from our arrival to find an apartment and move in. Given the language barrier, our limited knowledge of the sprawling city, and our full training schedule, it was a tough haul. Luckily for you, I’m now in a position to share my experience and help put your mind at ease.


Step 1: Research Before You Arrive

You’ll get an idea where you will be living before you go (ideally!). Check out SmartShanghai.com and Craigslist to get an idea of what you can afford and what the standards generally are in your area. With SmartShanghai there is an option to search by metro station as well. Be aware that photos are often not of the property listed.

Courtesy of Smart Shanghai

Courtesy of Smart Shanghai

Just like at home, be cautious when using Craigslist and don’t trust someone to send you keys via DHL! It’s a scam!

Before you go to China, you need some specific ideas about what you want in your apartment. For example:

  • A well-defined, hard budget (typically between 2000-4000 RMB for a TEFL teacher)
  • Do you want to live in a shared apartment, or your own place?
  • The specific metro stations that you want to live nearby as well as your place of work
  • Is an older apartment acceptable, or only newly-decorated ones?
  • What appliances do you require (be specific: washer, fridge, microwave, AC, TV, Internet, gas or electric stove)?
  • Do you want to be on higher floors or lower floors?
  • Do you require an elevator?

Having specific aims for your search helps the agent to find what you are looking for. This is one area of expat life where you should NOT be flexible.

Shanghai Railway Station

Shanghai Railway Station

Step 2: Visit the Areas You Want to Live In By Yourself

Before you contact a housing agent, get to know the area you plan to live in on your own. This is better than going with someone who has specific aims or a monetary interest. Go to shops, restaurants, and parks near your chosen metro stations. Pay close attention to the buses that run in the area; note them down for commuting.

Make a trial run of your daily commute. Time yourself to see how long it is to get to work, and do it at different times of day if possible. Learn to read the name of the bus stop you want for your commute and look for it on the bus shelters.

Step 3: Find an Agent

You could try to work out the whole system yourself, and I’d encourage you to do so if you speak decent Mandarin and/or have lived in China before. If this is your first time, it’s worth having someone who knows the city to help you. Agents will typically charge a 35% fee for their services, which can include interpretation, drawing up the lease contract, helping get internet set up, registering at the police station, and more.

If you work for a big company, they may have some options for you to get in touch with. Call your agent and work out a time to view some apartments. Most people suggest working with more than one agent, which gives the best chance to you.

Our agent is an absolute gem. Contact me directly on the ‘About’ page if you are moving to Shanghai and want his contact information. 

Our neighbourhood

Our neighbourhood

Step 4: Go See Apartments

The oldest trick in the Shanghai apartment racket: they will take you to see the shitty apartments first.

This serves two purposes. First, it might be possible to offload an apartment that just won’t budge on some unsuspecting greenhorns. Second, it makes all the apartments you see afterward look so much better by contrast. On our first day, we saw an apartment with windows that don’t close fully and a shower that looked ripe to electrocute us. Rust everywhere. Big space, though!

Keep your poker face on. Even if you are impressed by an apartment, don’t look impressed. If you think the apartment is shitty, indicate this. Set a good precedent by obviously taking notes on paper or a smartphone for later reference. Turn on the water in the sinks and shower. Flush the toilet. Light the stove. Check the hood. Open the fridge. Turn on the AC. Open and close the windows. Poke the bed repeatedly.

Check EVERYTHING at least twice.

Step 5: Go See Apartments

“No, really. I don’t want to see shitty apartments this time…”

Too late. They will do the same tactic as before, for the same reasons. Keep in mind that this is repeated for every agent you work with. Take detailed notes. Poke and turn on everything, repeatedly. Check for mold and bugs.

Now is the time to begin negotiating. Keep firm on your rent budget, and don’t allow your agent to take you to places beyond it. Ask for updated appliances. Ask for internet to be included. Ask if you can have it cleaned professionally before you move in.

You may get nowhere with this line of inquiry, but you will show that you are in the know about the Chinese custom of bargaining. If you don’t find something this time, repeat steps 4 and 5. It takes most people at least three outings to find a place in Shanghai.

Our building.

Our building.

Step 6: Put Some Earnest Money Down

Once you decide you like a place well enough, you need to move quickly. Be prepared to put down earnest money in cash.

This is to hold the place for you while you consider it, generally overnight. Don’t put down more than 1000 RMB, because you could lose it. In our case, we gave 500 RMB to our landlord directly and wrote a handwritten receipt for it (totally official). You should get a deduction on your deposit or rent when you sign your contract.

Step 7: Sign Your Lease

Your agent will most likely draw up the contract and ask you when you will move in, and how often you’ll pay the rent. It’s best that the contract be in both English and Mandarin, to prevent misunderstandings. This process is exhausting and will take about an hour. You can put down one month’s rent in cash if you don’t have access to the rest of the funds you will need.

You will also go to the apartment and check off the damage and appliances that it has before you move in, so that you can get your deposit back. Sign and keep a copy for yourself.

Step 8: Pay Your Remaining Rent

Keep in mind that if you are accessing funds from home, you can only take out 500 USD per day at an ATM. Plan to use the ATM a few times in the lead up to your lease signing, over the course of several days. Pay your remaining rent/deposit in cash, and make sure that you count it several times. It can easily be upwards of 10000 RMB that you will have to carry on your person. Don’t keep it all in one place, and use a money belt on the metro.

Optional step: feel like a kingpin with stacks of 100s on your bed.

Optional step: feel like a kingpin with stacks of 100s on your bed.

Step 9: Move In

Your apartment will likely need a deep cleaning. You can hire an ayi to help with that, or you can do it yourself. Check everything again to make sure that it isn’t suddenly broken. You can go to IKEA for household items and it will be relatively cheap.

Set up water delivery service if you can. Water in Shanghai is fine for bathing, cooking, and brushing your teeth with. It’s not ok for drinking, though. Make sure you have bottled water, or at the very least boil the living shit out of it before consumption.

Newly decorated!

Newly decorated!

Step 10: Register With the Local Police

As a foreigner in China, you must register at a local police station within 24 hours of moving to a new address. You will need:

  • Your passport
  • The original lease contract
  • A copy of your landlord’s ID
  • A copy of the property’s official documents (get from your landlord)
  • A pink piece of paper indicating that you stayed legally at a hotel while looking for a place to live (obtain at check out)

Make certain that you go to the correct police station! It’s best to go early in the morning, because you will have to wait a shorter time. Avoid lunchtime at all costs. You will receive a piece of paper with your face on it that indicates you have registered.

NOTE: If you do not register within 24 hours, you face a fine of 500 RMB per day and potential issues with your Residence Permit.


TADA! You live in Shanghai! Contact me directly with your questions!