Timothy Birdnow

Homeownership under Obama has dropped to it's lowest level since 1965.

According to Bloomberg:

"The share of Americans who own their homes was 62.9 percent in the second quarter, the lowest since 1965, according to a Census Bureau report Thursday. It was the second straight quarterly decrease, down from 63.5 percent in the previous three months."

End excerpt.

Why?

The article blames;

"The drop extends a years-long decline from the last housing boom, in part because of tight credit and a shift toward renting in the aftermath of the crash. First-time buyers have been struggling to find affordable properties as low mortgage rates and an improving job market spur competition for a tight supply of listings. Home prices rose 5.2 percent in May from a year earlier, according to the S&P CoreLogic Case-Shiller index of values in 20 cities released this week.

"One of the biggest hurdles now is affordability,” Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte, North Carolina, said before the Census Bureau report was released"

End excerpt.

Huh??? If prices are rising because of increased competition for properties, doesn't that mean SOMEBODY is buying them? How can prices rise but DEMAND be down?

This is classic liberalspeak. The reality is young people aren't buying because they are NOT seeing an improvement in the job market but rather are stuck in dead-end jobs that cannot and do not provide them with adequate means to purchase property.

And there has been an air of expectation, in which people feared a renewed crisis. People are frightened, because they know the economy is on shaky ground and some capricious act by the Obama Administration could wipe them out.

So who is buying up these properties and tightening the market? Mr. Potter, that's who.

Those who remember It's a Wonderful Life will remember that Mr. Potter made a large amount of his money off real estate speculation. He bought up lots of property during the Great Depression for pennies on the dollar and then rented it back to the former owners, who could not make their payments during the crisis. Had George Bailey not saved the Building and Loan Potter would have owned the whole town, renaming it Pottersville. That is what is happening here.

The last 8 years have been a boom to real estate rentals.People just can't afford to buy - or are afraid to do so. The Left has tried to spin this as a new paradigm where the young don't WANT to own their own property, but that is an attempt to apply supermodel makeup on porcine faces.

There are other things to consider too. For example, taxes have shot up during the Obama era, and young people see they are going to struggle to pay real estate taxes. Electric prices, natural gas prices, most utilities have gotten more expensive under Obama. And of course there are the Obamacare mandates. Obamacare raised the price of health insurance or required a fine, which takes money out of the pockets of the young. Also, Obama's "cash for clunkers" program and EPA standards have driven the prices up on used cars, making car ownership more expensive. Homeowners generally need cars to get to work to pay their mortgages. Home ownership is just too expensive and risky under the current regime.

But Bloomberg jumps through hoopes to excuse Obama in this article;

"The decline may be the result of young people leaving parents’ homes and entering the rental market, which dilutes the number of owner-occupant households, said Ralph McLaughlin, chief economist for data provider Trulia. He said the change from a year earlier, when the rate was 63.4 percent, isn’t statistically significant because of the margin of error of 0.5 percentage points.

"The drop in the homeownership rate this quarter to historical lows isn’t necessarily a bad sign,” McLaughlin said in an e-mail. "This is because renter households are growing at a much faster rate than owner households, reflecting growing confidence of those who were most likely impacted by the foreclosure crisis. Still, low inventory and affordability plagues those who do want to buy a home.”"

Emd excerpt.

Again, this misses the ppoint; these kids are finding more rental properties precisely because investors are buying them up. This dilution of households is a direct result of decreasing home ownership, which is being driven by a bad economy. And why, after eight years of alleged economic growth, are they just moving out of their parents homes now? There should have been a big exodus years ago as the economy supposedly improved. There is no good reason for them to be moving out now.

But perhaps there is? Maybe the Obamacare provision that says a young person can stay on his or her parents insurance until age 26 is keeping them at home? Again, this has nothing to do with a good economy and everything to do with a rotten government policy.

Liberals and the media may sway and dance, but in the end this is not good news at all. The attempt to spin this is utterly ridiculous.

Hat tip; The Gateway Pundit.

Posted by: Timothy Birdnow at 01:27 PM | No Comments | Add Comment
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