Post-WWII the US home ownership rate increased from under 50% to between 60% and 70% and has stayed there ever since. <a href="https://dqydj.com/wp-content/uploads/2014/11/historical_homeownership_1890_present_USA.png" rel="nofollow">https://dqydj.com/wp-content/uploads/2014/11/historical_home...</a><p>I'd argue that this makes for a bad public policy environment. With such a high levels of concentrated investment in a single asset class political manipulation of that asset class isn't just tempting, it's practically a political necessity. What the voters demand is impossible to sustain forever (monotonically increasing nominal prices <i>and</i> above the rate of general inflation growth over every five year period), but with such high political pressure politicians try anyway.
The Redfin CEO warned about weakness in the housing market back in August while discussing Redfin's earnings.<p><a href="https://www.marketwatch.com/story/housing-market-has-hit-a-significant-slowdown-in-recent-weeks-redfin-ceo-says-2018-08-09" rel="nofollow">https://www.marketwatch.com/story/housing-market-has-hit-a-s...</a>
Maybe if the bubble were <i>ever</i> allowed to actually just deflate, then we wouldn't be in a state of perpetual worry?<p>The present feedback loop is straightforward: CPI is an average of consumer goods and the price of housing. Due to technological and economic progress, the costs of manufactured goods are always dropping. To maintain the Fed's stated goal of continual inflation, new money must be injected into the housing market to compensate.<p>(The same goes for anything else that can be financialized, eg cars)
I have two houses paid off in the Seattle area. I'm tempted to sell them (I rent one out), but I don't know what I'd do with the money. I could hold and wait for a downturn and buy again but that seems risky.
As someone who just purchased a primary home, it’s unnerving to hear about a correction on the horizon and that my house won’t be worth the debt I took on.<p>I’m still recovering after tapping into my 6 mo emergency fund to make the down payment. I think I need to move to a more aggressive E fund regeneration strategy. The article states having ~20%~ 10% of home value in liquid cash; my ~6~ 3 month E fund is about there.<p>I haven’t learned how to check the indicators to tell if the economy is about to go through deleveraging yet. I don’t know if I’m seeing more attention to this type of article now that I own a home or if the presence of these articles are in indication something bad is about to happen.<p>I guess the future will tell. I’ll tighten my belt much more and get that E fund back up.<p>I wasn’t working in 2008 during the recession; I’ll prepare just in case I lose my job. No new debt.<p>Edit: article recommends 10% the value of your home in cash, not 20%, to get through a downturn. Updated this response.
That time never stopped here in the big-city parts of Canada. The US housing crisis was a speed-bump in our endless upward price-march out of affordability.
Every time I read these articles, I'm optimistic this might mean rents are going down, but they always have an asterisk: "Well, except the bay area." Which is understandable -- with 20 cities in the Case Shiller index, one bucking the trend does not negate the trend. But alas, I don't get to live in an index of 20 cities.<p>And it should be noted, this article is from February 2018.
I'm not sure what the situation is in the US, but in the UK there has been a number of changes which has helped increase the rate of new house building to increase the stock. This, along with Brexit uncertainly, looks like it's starting to show signs of slowing down the dramatic shortages and house price rises we've been seeing for decades. Some people bought based on assumptions regarding the rate of price rises and may be disappointed, but I don't expect a crash resulting in a lot of defaults because lending criteria has been tightened and many people have the last recession in their recent living memory so they are more careful.
As someone that doesn’t own a home, I really do hope for a correction so housing is more affordable here in California.<p>While Californians are aligned on many things, in some ways your perspective on the housing situation depends a lot on whether you own a home or don’t.<p>If things stay their course I plan on renting indefinitely and moving to another state where prices are relatively affordable for my family.<p>Having grown up in the Bay Area, it’s a little disconcerting that I can’t afford to settle down here after moving back after college.
> In 2017 I experienced softening rents first hand when I tried to find replacement tenants for my SF rental house at a similar rent of $9,000 a month.<p>That's more than I pay for a <i>year</i> for a 2bd apartment in downtown Phoenix...