The Role Of Housing In The Middle-Class Portfolio

The housing crisis of 2008 can trace its origins back to the stock market trends of the mid- to late 90 's. During a period of extended growth in the stock market, increased individual wealth among investors led to generalized increases in spending, including in the housing market. With more disposable income in the pockets of consumers, the demand for housing increased in the late 90 's. Due to the fact that homes are large projects and their construction takes a large amount of time, the supply of homes in the market is inelastic on the short term. Because of the fixed supply of homes, as per the law of supply, which

The increasing homeownership rate in the United States is a worthwhile policy goal. The housing economy creates jobs for American citizens as well as brings down the competitive qualities to purchasing a home allowing more middleclass citizens to spend money on houses. In doing so this drives the overall economy up in the United States.

The economic decline has possible home buyers, especially first time home buyers, scared to invest anything into the housing market. With the fear of another depression in the back of everyone's minds, some businesses are attempting to clarify the pros of home ownership.

Macroeconomics is an excellent tool for the analysis of the housing industry as something like a capital good, as a home is considered to be, cannot easily be studied in a short-term platform. Real estate is a good that costs several times more than an average persons annual income, in the United States that number is typically 7 times as much, and in the United Kingdom that number is 14 times as much. Several factors of both supply and demand directly impact the housing market on a macroeconomic scale. (Business Economics, 1)

By the 1970s, HCTI ratios increased to over 5:1 (U.S Census). Figure I denotes the housing appreciation trend in light blue has accelerated at a higher rate of speed during the past 40 years (Shiller, [2005]). Over the past 40 years housing values on average have doubled at the end of a housing boom, out pacing increases in median income by 50% (see Figure II, U.S Census, [1969-2008]). This has led to the median housing expense to being

Some experts feel the multifamily sector will remain appealing to investors as more millennials enter the job market and start to seek out rental housing. Other experts feel that the multifamily sector will experience continued growth if consumers continue to shy away from buying a home. A slow economy and strict mortgage eligibility requirements keep many consumers from buying a home and turning instead to the rental market. However, rising rents in multifamily properties could price many consumers out of the market, which would stall any growth in both the commercial and residential rental sector. This is not to say that will occur, especially if average wages continue to rise in the U.S. along with rising

It seems hard to believe that over ten years have elapsed since the peak of the US housing market in the previous economic expansion. Residential construction as a percentage of real GDP reached a zenith of 6.2% in 2005 Q3. The ensuing contraction saw this share decline -60% to trough at 2.5% of GDP in 2010 Q3. The current economic expansion began in 2009 Q3, but the sheer magnitude of the collapse made it virtually impossible for any subsequent housing recovery to impart the same outsized contributions to headline GDP growth compared to the previous cycle. This has consequently played a significant role in restricting the ability of the economy to shift into a higher gear of growth during the current

One of the notable issues with the U.S housing market is the extent to which the Government failed to stimulate home ownership rates in the long run. Historical trends in the U.S home ownership rates show stagnant growth in home ownership after the early 1960’s. The Federal Reserve Bank of St. Louis Review indicated that homeownership rates remained relatively constant from 1965 to 1995, despite a wide variety of government policies aimed at stimulating home ownership (Federal Reserve Bank of St. Louis Review 2006). Following 1995, the U.S home ownership rates indicated significant improvements. According to the U.S Statistical Abstract, aggregate home ownership during the period 1995 to 2005 indicated a record high for the U.S housing market (Chambers, Garriga, & Schlagenhauf 2008). Matthew Chambers, a professor for Towson University,

Having inequality in the housing market not only affects where you live, but how you live while there. In most cases, African Americans are constantly stereotyped to have more health issues and less education. However, with the trend of concentrating certain racial groups into low income neighborhoods, they have also become directly proportional to having health issues, most of which can be traced back to their environment. Things that effect these neighborhoods include a lack of healthy food options and pharmacies, increased advertising for tobacco and alcohol, and subtle existence of food deserts. Overall, the health of community members in low income neighborhoods depletes. The absence of healthy, fresh, affordable options force residents to consume and purchase foods that are highly processed and calorie dense or pay more at the local store for what would be offered at a large chain

A home is the biggest purchase and investment one can make in their lifetime. For decades, “home-ownership” has been silver plated with the aura of the American Dream. However, the lending crisis and meltdown of 2008 in real estate prices across the nation took away the luster off that American Dream for many. Now however, after reflecting from past mistakes, homeownerswho lost their homes in the housing bubble crisis realize it takes a lot to obtain the American dream and are eager to reenter into the home market as buyers. These boomerang buyers might just benefit withthe option of rent-to-own amongst other options.

I returned from my deployment to Afghanistan tan, lean, and anxious about the impending nuptials a few weeks away. During the intervening time, I looked for a house that my wife and I could call home, our own expression of the American dream. I found a brick ranch in a neighborhood that had been built right after World War II—probably to house a family in a very similar situation to my own. I was able to purchase the house thanks to a zero down loan from a local bank, guaranteed by the Veterans Administration. My situation was not a unusual one, but rather an echo of the development of suburbia. The United States was suffering from a severe housing shortage in the 1930’s and despite their best construction efforts, faced a worsening crisis

Commodification of housing allows wealthy people to treat it as investment rather than shelter, fuels the

The purchase of a new house is a long term investment, with long term ramifications and consequences. The final decision is influenced by a wide array of elements, including economic traits such as:

Owning an average American home for the middle class in the USA has become increasingly difficult of late, owing to the huge financial responsibility that mortgage strain on the prospective owners. Land for example has appreciated a big deal of late, and thus any middle class person with a desire to buy their own homes has found the costs very unfriendly.

In this report, the question “How much of the changes in the median selling price of homes in a city can be explained by the changes in median income of that city?” is answered. Home ownership is an important aspect of one’s life stages, and home prices are determined by demand and supply. The demand curve is affected by the one’s income, such that as one’s income increases, one is more willing to pay a higher price for the same quantity of goods (Baye & Prince, 2014). However, there are many other factors that might affect the demand curve, e.g. no. of children, in the household, the perceived quality of education in the school district, or the number of job positions (filled or open) around the city. According to Burda