The World on a Mortgage: When an American Takes Out a 30-Year Mortgage, They Don’t Know What They’ll Be Doing in 2056
A mortgage for 30 years doesn't automatically mean you'll live in the same place for 30 years. In the USA, people sell their homes on average after eight and a half years. That number surprised me. It made me think about how many of us, when signing a mortgage contract, are actually buying not just a property but an idea of our own future. When we buy a home, we are not just buying a roof over our heads. Often, we are also buying an idea of where we will be in ten, twenty, or thirty years. However, life tends to have its own intentions with our plans.
Recently, I came across a joke that amused me more than it probably should. American: 30-year mortgage. European: 30-year mortgage. The difference? The American changes states three times, jobs four times, and spouses five times during that period.
It's obviously an exaggeration. However, like most good jokes, it contains a piece of truth. Not about mortgages themselves, but about how differently we think about housing, work, and the future. When you place a Czech and an American mortgage contract side by side, you won't find much difference at first glance. In both cases, it's a long-term commitment, often for thirty years. Yet, I feel that people on both sides of the Atlantic imagine completely different lives under them.
Mortgage as a Life Plan
When clients in the Czech Republic are dealing with housing financing, they rarely talk only about rates or payments. In reality, they much more often discuss children, kindergartens, commuting to work, proximity to family, or whether there will be enough space for a study in the future.
Thus, a mortgage is often not just a financial product. It is a life plan. Sometimes I even feel like when buying the first property, we are already mentally setting up a room for future grandchildren. There is nothing wrong with that. Stability and long-term planning have been European values for generations. However, the world around us is changing faster than we are used to.
American Perspective: Life on the Move
In the United States, the relationship to housing is often different. A thirty-year mortgage is the standard here, but many people do not spend thirty years in the same house. According to data from ATTOM, Americans held a property for an average of 8.4 years before selling. In other words, most of them sell their home long before the original mortgage would be paid off.
There are many reasons. Moving for work, for business, for a better climate, or simply for a new life stage. In American culture, changing addresses is not seen as a sign of instability. It is often considered a natural part of personal and professional growth.
According to data from the U.S. Census Bureau, approximately 11% of Americans changed their residence in 2024. This means that roughly every ninth resident of the United States changed their address. In comparison, in the Czech Republic, according to the Czech Statistical Office, 2-3% of the population moves annually within the country. An American is approximately four times more likely to move during the year. A Czech person is sometimes taken aback by the idea of moving from Prague to Brno. According to the OECD, the average duration with one employer in the Czech Republic is 11 years, while in the United States, it is an average of 4 years.
If I exaggerate a bit, to some Americans it seems normal to move across half the continent for an interesting job offer. In American movies, a moving truck is almost as common a prop as a family house with a white picket fence. Just think of the movie The Money Pit (1983), in which Tom Hanks and Shelley Long portray the American obsession with owning a home and moving.
Is Europe Changing Too?
Nevertheless, I don't think it's just a difference between Europe and America. The last few years show that the Czech approach is also changing. People are more frequently changing jobs, working remotely, and are much more considering the quality of life. Some are leaving big cities for the countryside, while others return after several years. What was an exception ten years ago is becoming a common part of life. Perhaps that's why fewer and fewer people today can say with certainty where they will be in ten years, let alone thirty. However, the OECD points out that the Czech Republic is among the countries with the lowest labor mobility in the European Union.
Can We Plan for the Year 2056?
And here I return to that joke. If you take out a thirty-year mortgage today, do you really think you know where you'll be living in 2056?
Thirty years ago, we didn't have smartphones, social media, or remote work. Google didn't exist. Netflix didn't exist. Airbnb didn't exist. Yet today we often think we can fairly accurately predict the next three decades of our lives. I wouldn't dare to.
So, perhaps the most important question isn't how many years we take out a mortgage for. Maybe something else is more interesting: how many versions of ourselves will we encounter over those thirty years. Because while a mortgage can remain the same, life usually rewrites itself several times in the meantime.
And maybe that's why the joke about the American and the European caught my attention more than it should have. In reality, it's not about mortgages. It's about how each of us envisions our future. A mortgage shouldn't be an anchor that holds you in place. It should be a tool that helps you live the life you want.
Sources: author's article, commentary, ATTOM Data, U.S. Census Bureau, Czech Statistical Office, OECD
