Virus Charts – A Treasure of Common Sense

I’m sure a lot of economic data makes us very angry.

Now you can slice and dice the economic number pie in so many different ways that you’re bound to drive one group of people crazy every time.

Ah well. So there is progress sometimes.

There are two viral charts that have been floating around for a year or so that have this effect.

The first comes from the National Association of Realtors, which shows the median age of home buyers was 59 by 2025:

That’s from the mid-30s back to the early 1980s. This is not a happy practice.

Another shows that the top 10% now account for nearly half of all consumer spending:

This is a K-shaped economy where the rich get richer and everyone else is left scrambling for scraps on the back burner.

Both of these charts annoy young people because they show that all the rich old people are absorbing all the financial wind these days.

Charts like this are depressing.

Why should young people be excluded from the housing market? Why should the top 10% spend all the money? The K-shaped economy is getting worse!

Here’s the problem with these two viral charts that make a lot of people a lot angry – they are inaccurate.

The narrative seems real. Rich people spend all the money! Old people buy all the houses!

But it’s actually not true.

NAR data is based on a survey. Sometimes, surveys are wrong. Guess who doesn’t take surveys anymore. Young people! Who does it? Adults!

Connor O’Brien found that the 59-year-old number was not confirmed by other data sources:

O’Brien explains:

Larger government-run surveys such as the gold-standard American Housing Survey and the American Community Survey have shown no increase in the age of the average consumer since the pandemic, while the NAR’s median age estimate has been accurate. My analysis of American Housing Survey data found that the average buyer in 2023 was 42 years old. The same estimate using 2023 American Community Survey data shows a median age of 41, unchanged over a decade.

Surprisingly, the average age of home buyers has not changed at all over the decade. That’s despite one of the biggest affordability shocks in housing history.

The data also doesn’t match the chart that shows the top 10% accounts for 50% of spending.

Ernie Tedeschi came up with the lowest number:

In fact, it is lower than it was before the pandemic.

Matthew Klein agrees:

According to joint BEA-BLS estimates, the top 1% of households by disposable income have been responsible for about 2-3% of total PCE, while the groups below them (95-99th and 90-95th) have each been responsible for about 9% of PCE. In other words, high-income households tend to spend twice as much as one would expect from a perfectly balanced distribution even though their income is about 3.5 times the effect of greater equality. Meanwhile, the bottom 80% of the income distribution remains responsible for nearly two-thirds of total consumer spending, while the bottom 60% is responsible for 42%. The radical claim that the top 10% of earners is somehow responsible for half of all consumer spending is far from consistent with the official data.

Tedeschi also points out that low-income families spend more than the viral chart shows:

Most spending surveys show low-income households spending at least on par with high-income households by 2025. Households making less than $50,000 reported spending growth of 5% by 2025, compared to 4.6% for households making more than $100,000. While inflation-adjusted retail spending for low-income households grew more slowly than for high-income households in 2023 and 2024, the gap reversed in 2025–low- and high-income spending grew at similar rates. This is consistent with late but larger and more reliable government data, which shows the top income share of aggregate spending to be 22.8% in 2024, down from 23.4% in 2023 and below the recent peak of 23.9% in 2016 (economist Antoine Levy has some useful data here).

This data doesn’t fit the narrative does it?

I’ll be honest – I got both of these charts infected. It would make sense that only old people can buy houses. It would also make sense that rich people actually carry the economy.

Yes, housing is still a problem. Income inequality is real.

Is it too expensive for young people to buy a house today? Definitely.

Is the top 10% richer than the bottom 90%? Yes.

The top 10% control about 70% of the wealth in this country.

But it’s not as bad as you think right now.

Don’t let the economic data drive you crazy.

Further reading:
Rich Old People