I don’t think this post is unrelated to Corey’s post on Seattle’s economic boom. I’m Canadian so my demographics are a bit different. As of 2013 the rate of home ownership across all of Canada’s provinces averaged out at ~67% but I think the same trend may hold true North of the border.
My question is, when should I start buying up the houses left vacant by RIM’s shrinking executive caste?
The general advice is to buy once the cost of a mortgage is less than the cost of rent. Factor in ownership costs in your calculations, and determine if you’re really interested in being tied down to the area if the local economy tanks.
What about home ownership among “investors”, that appears to be booming
And yeah when MrsTobinL and I bought the mortgage for the 3 bedroom with full basement house wasn’t a god awful amount more than a 2 bedroom apartment at the time so it made sense. Now it is a few hundred less.
If you are gonna stay put for 10 years or more, then look into buying/mortgage, otherwise meh, rent and don’t worry about it.
The whole bubble has been odd for me who remembered things like balloon loans and people being foreclosed on being on the news programs when I a kid, and interest rates were way way higher as well. If interest rates go up again then house prices will have to come down. Also historically 63% ownership rate is normalish. It wasn’t till all the mortgage options went crazy and nobody said hey this guy is a shift manager at mcfood, maybe we shouldn’t lend them $400K that the ownership rates went up. Possibly the spike in the 2000’s is the anomaly and we are reverting to the mean?
There is something really wrong when the middle-class dream of owning a home and raising a family can not be realized. For myself, I got the middle-class and the family thing down, but at this point there is little hope that I will ever own a home for my family.
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks…will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered…. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” – Thomas Jefferson
Owning a house is like having a boyfriend who keeps you warm at night but every year or two calls you at 2 AM needing to borrow $12,000.
Any idea why the statistics there are so old? I was hoping to see regional statistics for 2010 or later.
There are probably better and that was quick google search results. I just wanted to show a longer term than 1960s. Heck even with the graph in the post we don’t have the big hump till NOW basically. Which tends to make me think NOW is the anomaly and we are just getting back to what is normal but everyone in 'murrica seems to have a short short memory.
This chart shows that there was a spike in home ownership correlating with the stock bubble of the nineties, and continuing through the housing bubble of the mid-oh’s. It seems to have corrected itself and perhaps has a bit of overshoot in the downward trajectory. That’s to be expected, since the lending regulations are a lot stricter as a result of that ridiculous bubble 10 years ago.
I’m glad I was able to sell into that bubble, instead of getting caught in it as an albatross owner. It was mostly luck. I have relatives who thought they were competent real estate traders during the rise of the bubble, who came out rather worse off.
I agree, and believe this is bad journalism by Bloomberg rather than actual reporting. The headline should be “US Home Ownership back to historical norms after fraudulent lending practices exposed”
Not everyone should own a house – some people move a lot, some people live in areas where renting is preferred for their lifestyle, etc.
Here’s a less dramatic, perhaps more accurate chart of the same data;
i had noticed that problem with the original graph. i like the scale to start with either zero or the baseline to prevent over-dramatizing small variations.
The problem is those “small variations” have big effects on the economy. There’s a lot of misery hidden in that almost imperceptible downslope.
I live in a city where a lot of houses come with a nightmarish amount of structural problems it seems (small sample size of people I know who bought houses in the city), and the idea of living in the suburbs seems pointless - being in the city is the whole point of putting up with traffic, people, and other annoyances of the region. Buying a house just doesn’t seem like a wise use of money at this point. I don’t have the time or energy to mow lawns, trim bushes, fix gutters, and repave driveways.
Just wait until interest rates aren’t at the lowest levels in basically all of history.
Neither did a lot of the people who bought houses in my area during the bubble. So when prices dipped in 2008-9 and my spouse and I could afford to buy, the houses in our price range were in really bad shape. And that’s just one of the reasons why we’re still renting.
Yeah I can sympathize there. I now think I got too much yard. The driveway is concrete and still in fair shape so not much to do. Gutters, roofs, well I will pay for that to be done.
Then there is the inside upkeep. That is a lot more time than just zooming through an apartment for a cleaning.
Some of this can be explained by a population shift from rural and suburban areas to urban areas. It is more common to rent in urban areas. I would also be very interested to see how much this varies by region. Home ownership on the east and west coasts are probably going up but they aren’t in much of the midwest.
I think a very small amount of this is attributable to population shift - this is a short-term change, and population shift is a long-term trend. There are some very specific things that happened around 2000 that led to the housing bubble and subsequent collapse and recession, and those are pretty well documented. Most of them are related to changes in banking law and banking practices that allowed or encouraged banks to make unsound loans to new home owners.