The economy is going great, except for the housing market

Any way you look at it, the government has to kick existing owners in the teeth to fix this crisis. Housing prices need to return to a reasonable multiple of wages, and that can only be done with supply. Everyone is going to have to get over the idea that they are "building wealth" and "getting ahead" by merely owning a box.

The 2017 tax act had an obfuscated impact on corporate ownership of houses. Capping the personal SALT deduction while simultaneously lowering the corporate tax rate made local tax policies to increase local ownership ineffective.

I can't tell what a "great" housing market is defined as in this article. I don't own a house, so to me, house prices decreasing is "great".

That&#x27;s not really surprising, considering that&#x27;s exactly how interest rate increases are supposed to work. They crowd out a bit of business investment and a lot of housing investment [1]. This in turn cools the economy by curtailing construction.<p>Unfortunately, housing in most areas was screwed to begin with. This was not nearly the case with prior inflation bouts that required rate increases. The Fed was left with two bad choices. It did what it had to do.<p>If the economy was Windows XP, housing would be its networking stack - its most exploitable sector. This is largely because of local governance and regulatory capture [2]. Housing has been artificially undersupplied for 5 decades under a variety of pretexts, such as architectural integrity. It has effectively turned the sector into a pyramid scheme that captures the wages of renters.<p>[1] <a href="https:&#x2F;&#x2F;archive.is&#x2F;8wAry" rel="nofollow">https:&#x2F;&#x2F;archive.is&#x2F;8wAry</a> (from <a href="https:&#x2F;&#x2F;www.nytimes.com&#x2F;2022&#x2F;04&#x2F;19&#x2F;opinion&#x2F;inflation-interest-rates-housing-mortgage-loan.html" rel="nofollow">https:&#x2F;&#x2F;www.nytimes.com&#x2F;2022&#x2F;04&#x2F;19&#x2F;opinion&#x2F;inflation-interes...</a>)<p>[2] <a href="https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Regulatory_capture" rel="nofollow">https:&#x2F;&#x2F;en.wikipedia.org&#x2F;wiki&#x2F;Regulatory_capture</a>

The SoCal housing market is insane, especially San Diego where the pay to mortgage payment ratio is completely off-kilter. Don’t know how this city is going to function in 10-20 years.

Encouraging as many <i>voters</i> as possible to own homes was one of the worst mistakes of all time in the us&#x2F;canada

Just scratching my head on this &quot;great&quot; economy. Brutal food prices, energy prices, car prices, commodity prices. Lots of &quot;jobs&quot; that pay less with fewer or no benefits. All the side streets and park-n-ride lots with campers. And the federal debt around $35 trillion with debt service bigger than our bloated military budget?<p>I get it, for this author the loudest squeak is housing cost. But he really needs to also work for a big picture.

I think the economy is doing decently <i>in aggregate</i>, but doing either extremely great or extremely bad depending on which specific part of the economy you look at. Kind of like how the US Air Force will tell you there is no such thing as The Average Man.<p>Looking at the securities market (stocks and bonds) they&#x27;re basically a statistical anomaly with how good they&#x27;re doing. Inflation is irrelevant with luxury goods and bad with life&#x27;s necessities. Cost of housing is too high in the metros and reasonable in rural regions. Wages and salaries for the rank and file are stagnant but are going up for management. etc. et al.