Via the New York Times, experts believe home ownership will never be what it was in the good old days.
The notion of housing as an investment first began to blossom after World War II, when the nesting urges of returning soldiers created a construction boom. Demand was stoked as their bumper crop of children grew up and bought places of their own. The inflation of the 1970s, which increased the value of hard assets, and liberal tax policies both helped make housing a good bet. So did the long decline in mortgage rates from the early 1980s.
Then things changed in in the late-nineties, coincidentally (or not) right around the time of the greed-fueled dot-com bubble.
“The experience we had from the late 1970s to the late 1990s was an aberration,” said Barry Ritholtz of the equity research firm Fusion IQ. “People shouldn’t be holding their breath waiting for it to happen again.”
And:
“It’s entirely likely that markets like Arizona will not recover even in the 15- to 20-year time frame,” said Mr. Humphries of Zillow. “The demand doesn’t exist.”
There we have it. Dave Del Dotto has gone the way of the dodo. So huddle up, build your havens, and live happily ever after, but don’t expect to profit from turning around real estate anymore.
Probably just as well.
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