Priced out of the market
The sad truth is that while Griffin plans his record-setting Florida mega mansion, many Americans are living paycheck to paycheck, unsure if they’ll manage to make the next month’s rent — let alone buy a house. Home ownership is growing increasingly out of reach for a significant proportion of the U.S. population due to sky-high mortgage rates and house prices.
For several weeks, the average 30-year fixed mortgage rate has hovered close to 8%. On top of those significant borrowing costs, house prices are so high today that prospective buyers in the U.S. need an annual income of almost $115,000 just to afford a median-priced home. That is around $40,000 more than the median household income.
This is why many Americans are renting instead of buying property at the moment, especially as the average monthly mortgage payment on a new home is now 52% higher than the average apartment rent, according to a report from The Wall Street Journal, based on data from real estate firm CBRE.
Even rich young Americans — with the cash to buy — are renting because they don’t want to shackle themselves to the astronomical costs of home ownership and would rather allocate their hard-earned dollars to smart investments.
Meet Your Retirement Goals Effortlessly
The road to retirement may seem long, but with WiserAdvisor, you can find a trusted partner to guide you every step of the way
WiserAdvisor matches you with vetted financial advisors that offer personalized advice to help you to make the right choices, invest wisely, and secure the retirement you've always dreamed of. Start planning early, and get your retirement mapped out today.Get Started
Build real estate riches (without billions of dollars)
Investing in real estate is not reserved solely for high-net-worth individuals like Griffin — although it does get easier as your coffers grow deeper. Anyone can get a piece of the real estate pie and you don’t necessarily need to splash the cash to do so.
If your monthly income covers your living expenses, you’ve got your debts under control, you’ve built an adequate emergency fund and you still have some money left over each month, you may want to consider your investment options to secure your financial future.
Putting your money in real estate doesn’t have to mean buying, directly owning and managing physical office buildings, apartments, homes etc. Instead, you can spend a small amount of money to purchase shares in real estate investment trusts (REITs) or exchange-traded funds (ETFs) made up of them. These two assets promise regular dividends that you can then reinvest to grow your wealth.
If you want to gain exposure to private real estate development projects and REITs that aren’t publicly traded, you can consider using a real estate crowdfunding platform. These platforms enable individuals with a shared desire to invest in real estate to pool their money together and buy property. While there may be advantages to this route, like superior returns, and you can start investing on some platforms with as little as $100, experts warn the risks may also be higher. Private real estate projects may not be as transparent as public REITs and these investments are comparably difficult to convert to cash.
Again, you don’t need Griffin’s billions to build a real estate portfolio. Remember, whatever you invest could compound and turn into a down payment for that dream house within a number of years.
Follow These Steps if you Want to Retire Early
Secure your financial future with a tailored plan to maximize investments, navigate taxes, and retire comfortably.
Zoe Financial is an online platform that can match you with a network of vetted fiduciary advisors who are evaluated based on their credentials, education, experience, and pricing. The best part? - there is no fee to find an advisor.