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Why Housing Policy Feels Like Generational Warfare -- To Millennials, at least

edited June 2019 in Off-Topic
This article presents the problem in a straightforward way. It makes it easier to understand the attractiveness of socialism to many young adults...
There are obviously many reasons that coastal housing markets have gone so bonkers. But it is an ironic twist that residential property, which once served as the bedrock for American capitalism, has become the most obvious sign for young people that something is deeply wrong with the markets.
Years to save for 20% down payment for a median-priced home with a median income (just in time for retirement in some high cost coastal cities!).....



  • edited June 2019
    Thanks for posting.

    Yes, property prices anywhere that has a healthy economy, are inflated. The biggest factor here, IMO, is monetary policy -- which increasingly has become the sole reliable tool to manage the economy. -- Fiscal policy, run by malignant, dysfunctional politicians cannot be relied upon. Nor can long-term regulatory/legal improvements.

    Relying on monetary policy means ALL asset prices are inflated. Housing. But also stocks, bonds too.

    A second factor is too much immigration, legal and illegal, which effectively ensure growing demand -- and thus more/higher bids for houses. Our cities are increasingly crowded -- and thus increasingly expensive to live in. (Did the Atlantic article discuss immigration's effect on inflated housing costs? Probably not.)

    Additionally, for 30 years, homebuilders have had as a business model, building mostly "super-sized" homes, building relatively few starter-size single-family residences. They do this because its more profitable to do so. The typical new home these days might have 40% more sq footage than those built in the 1960's. All those extra square feet cost more.

    Local/state pols, with overcrowded cities and super-sized homes, and artificially low interest rates, as all of these increase property tax revenues. The downside: An economy that "eats its young" (financially speaking).
  • Edmond +1
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