Monday, September 13, 2010

Time Magazine: "The Case Against Homeownership"

"For the better part of a century, politics, industry and culture aligned to create a fetish of the idea of buying a house."

Buying a house isn't, and shouldn't, be for everybody, nor should it be part of "The American Dream," Time Magazine argues.
The dark side of homeownership is now all too apparent: foreclosures and walkaways, neighborhoods plagued by abandoned properties and plummeting home values, a nation in which families have $6 trillion less in housing wealth than they did just three years ago. Indeed, easy lending stimulated by the cult of homeownership may have triggered the financial crisis and led directly to its biggest bailout, that of Fannie Mae and Freddie Mac. Housing remains a drag on the economy. Existing-home sales in July dropped 27% from the prior month, exacerbating fears of a double-dip recession and accelerating the accompanying slide in stock that took the Dow Jones industrial average to a seven-week low. And all that is just the obvious tale of a housing bubble and what happened when it popped. The real story is deeper and darker still.

1 comment:

Anonymous said...

I haven't read the story, but I know the bearish case. However, TIME is historically a reliable contrary indicator: Cover story appears so the trend has peaked.