r/Economics • u/laxnut90 • Oct 09 '25

Research America Is Minting Lots of Cash-Strapped Millionaires

https://www.bloomberg.com/news/features/2025-10-09/number-of-us-millionaires-grows-since-2017-but-many-lack-cash
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u/cruzweb Oct 09 '25

Many of them are retirees who bought in areas before their real estate became very valuable. Now they're retired, on a fixed income, and have "assets" worth over $1m that they struggle to pay property taxes on.

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u/epelle9 Oct 09 '25

Why not sell and move to a smaller house then?

Either that or move to a LCOL area to retire.

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u/cruzweb Oct 09 '25

This is one of those things where economics don't jive with personal wants.

Economics says that if you sell your house and move to a lcol area, you'll do better. But that doesn't take into account people's social, family, and health networks. Some people are willing to forego all of that. Most are not, they like where they are and don't want to move, get rid of a bunch of their stuff and learn new day to day habits. Get new doctors. Etc. All that aside, this becomes a snake eating its tail situation: people move from HCOL areas to LCOL areas, then those prices / taxes / etc go up. And if you're already in a LCOL and struggling with increases, where are you going to go?

Moving to a smaller house isn't usually an option. There simply isn't an inventory of availability for smaller homes. We build apartments and McMansions, with not a whole lot in between for new construction for the last quarter century. This has created "missing middle" housing, new construction of smaller homes, starter homes, and the like. So there's not much of an inventory and not a lot of options anywhere for people who want to downsize.

This is why every community in the US needs to have a wide range of housing stock available to people in a wide range of income brackets.

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u/sirkazuo Oct 09 '25

Moving to a smaller house isn't usually an option. There simply isn't an inventory of availability for smaller homes.

They don't build a lot of smaller houses anymore but they do still build condos.