US. The Crisis Behind the Housing Crisis
Ms. Scanlon, a contributing Opinion writer, is the author of “In This Economy? How Money & Markets Really Work” and Kyla’s Newsletter.
It’s no secret that we don’t have enough housing in the United States. Even Congress agrees: The biggest housing bill in decades recently became law and should help. Supply is outmatched by demand, and the young can’t get into areas with dynamic and expansive economies.
We certainly have a housing crisis. But hiding inside it is a retirement crisis — and that is the one the new law doesn’t touch.
A home has stopped being just a place to live — it has also become an asset that has to appreciate in value to underwrite the homeowner’s retirement. The value of a home now serves double-duty as a nest egg. Homeownership became, in short, the typical American retirement plan.
But this creates a trap. Young Americans want to be homeowners, too. So owners need home prices to rise to provide for their retirement; buyers need them to fall.
The house can’t do two contradictory jobs at once. The link between retirement and home prices is pitting the old against the young.
Read more @nytimes
