With the current price of housing, the American Dream is dead. When I was a child in the ‘90s, my parents bought their first home for around $35,000. That translates into around $84,000 today. Although that is a chunk of change, what can that really buy in today’s market? A nice vehicle, maybe? A bachelor’s degree? It’s certainly not enough to buy a house. In Utah, you need about half a million to do that.
So, let’s contrast. What can you do with half a million in today’s market? That’s enough to start just about any business you can think of complete with shop or office rent for a year, a company truck and the first year’s salary for one or two employees, as well as your own. With a solid business plan and a bit of effort, anyone should be able to flip a profit from $500,000.
That’s the problem with the housing market. Housing prices have outpaced inflation by so much their average price is about the same as buying a small business. Why would anyone want to sink that much money into a house? Why take out that much of a liability if it isn’t worth the risk? Life happens, and every American who isn’t wealthy beyond reason, is just one medical emergency away from losing it all. Buying a house, you’d be out half a million dollars to the bank and your credit would be ruined. Yet buying an LLC, you’d be fine even if it goes belly-up.
Stephen Atkin, West Valley City