Sunday, May 1, 2022

Americans Get Richer and the New York Times is not Whining

5/1/22 New York Times:
"Over the past two years, Americans who own their homes have gained more than $6 trillion in housing wealth. To be clear, that doesn’t mean homebuilders have transferred to buyers $6 trillion worth of new housing, or that existing homeowners have made $6 trillion in kitchen and bathroom upgrades."

And amazingly, this is not the archetypal "End of the World; blacks and women especially hard hit" stories.

"Millions of people — broadly spread among the 65 percent of American households who own their home — have gained a share of this windfall....

The cumulative effects figure to be sweeping, and divergent: This period of rising equity will enable some families to create intergenerational wealth for the first time. It will force other families to delay homeownership for years....

But Black home-owning families will benefit in particular because Black household wealth is overwhelmingly in the form of housing."

The downside is that those who did not (or could not) buy homes are probably out of luck for the foreseeable future.  The good news is the experts they interviewed think this is unlikely to be a repeat of the 2008 housing collapse because it is not built on high risk mortgages.   Even rising interest rates are unlikely to destroy most of this wealth. 

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