Evan X. Merz

I sometimes consider changing the name of my blog to "the oldest millenial" because I was born in 1981, which is usually considered the start of the millenial generation. Sometimes people put the start of the millenial generation in 1982, but in either case, I mostly sympathize with millenials so I consider myself an old millenial rather than a young Gen-Xer.

My point is that I'm not young, but I'm young enough to see how much the elder generations have hurt young people. Stagnant wages, rising college prices, burning fossil fuels, and the shredding of the social safety net mean that everyone younger than the boomers has a far more difficult time finding success in life than the boomers did.

So when I learned about the rule changes coming from realtors, it struck a familiar chord. I don't know what the realtors are calling the new rule, so I'm going to call it the "Treat Young People Like ATMs Rule of 2024".

Who are realtors?

Realtors are a professional organization of salespeople who facilitate home sales. They aren't a part of the government. They aren't even a necessary or required part of the home buying process. They are simply salespeople who have banded together in an organized way.

They ostensibly make buying homes easier, but they have a mixed reputation, to say the least. Still, they are usually involved in both sides of any home sale. Both the buyer and the seller each hire an agent and they work together to help the buyer and seller achieve their goals.

The basic dynamics of the arrangement aren't changing.

The Treat Young People Like ATMs Rule of 2024

So what IS changing?

In the past, the fee for each agent came out of the seller's end. Each agent recieved around 2.5% to 3% of the sale price as their fee. So the seller would make 5% to 6% less than the sale price because that amount would go to the agents.

The new rule forces the buyer to pay the fee for the buyer's agent. It also forces the buyer to sign contracts that require them to work with and pay a specific agent.

How does this hurt young people?

Now, in a fair world, this could be seen as fair play. The seller pays the seller agent fees and the buyer pays the buyer agent fees. Fair enough, right?

But context matters.

The context of this rule change is that the people who own homes today didn't have to pay the buyer's agent fees when they bought their homes.

Now, in addition to the 10% to 20% downpayment that first time home buyers must accumulate, they must accumulate an additional 3% to pay their agent. Adding the additional 3% on the buyer means that more young people will be locked out of home ownership even longer.

It also means that homeowners will take a larger share of the pie. It's a wealth transfer from young, non-wealthy people, to old, wealthy people. Yet again, the older generation, rather than helping young people, is changing the rules in order to steal from them.

What's the point?

So why make this rule at all?

It's difficult for me to understand why this rule exists.

It will have the impact of artificially making housing prices look lower than they really are. This will confuse first time buyers.

It will have the impact of allowing home owners to take a larger share of the pie. This is the part where they're using young people like ATMs.

It will also make it easier for investors and the wealthy to scoop up homes at prices that first time home buyers can't afford.

It may temporarily prop up a housing market that is clearly heading for an "adjustment".

Shopping shouldn't be a contractual process

But the weirdest thing about this law, beyond the predictable greed, is that it makes shopping a contractual process. It forces people who want to buy a home to sign a confusing contract that locks them into fees with an agent who, in many cases, adds very little value to the process.

The realtors, as a professional organization, have clearly overstepped what any rational person would consider reasonable. Shopping shouldn't be contractual, and it's unfair to place even more of a burden on first time home buyers and young people.

When did this become okay?

When did older generations start seeing young people as their ATMs? When did older generations switch from supporting younger generations to stealing from them?

The greed embodied in credit scores, stagnant minimum wage, and this new rule is staggering. (Not to mention the unsustainable burning of fossil fuels, which is increasingly hard to ignore.)

As of this writing, I'm 42 years old. I don't consider myself an old person, but as I said at the beginning of this rant, I'm an old millenial. And frankly, I'm ashamed of everyone over the age of 40. How can any older person support putting more of a burden on young people, especially when it comes to housing?

I think that we're turning a corner on many of the issues mentioned in this rant, but regressive policy changes like this are a step in the wrong direction.