Housing sales, according to The New York Times, have “plunged to their lowest level in more than a decade, exceeding even the grimmest forecasts.”
Anyone who drives down a residential street in the US may already have reached a similar conclusion. The FOR SALE signs look as sad and lonely as the houses they tout, and may have been on the lot almost as long as the houses.
It is obviously a buyer’s market. What is not obvious is the buyers. Where are they? Why are more people not harvesting real estate at by-now-bargain-basement rates?
The answer, I think, is in the housing (I almost wrote “hosing”) market itself. Another recent NYT article quotes real estate experts who “now believe that home ownership will never again yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg.”
Which is to say, people who buy a house today probably plan to live in the house, not to quickly flip it for a dividend. What a remarkable idea: buying a house as if it were a home rather than a hedge fund.
How did we get here, to this point of no (or diminishing) return? The same way we got into a war in Iraq. The Iraq War was demonstrably — then as now — not about retribution or national pride or democratic ideals. It was about money from oil. The housing debacle has not grown out of the need for good places to live; it has grown out of greed.
There are a lot of innocent or at least sympathetic victims of this mess, people who thought they were buying into an old-fashioned American dream when they were buying into an old-fashioned American Ponzi scheme.
Wonder what archaeologists from a remote world would make of those butt-ugly orange and red plasticky megahouses littering the hillsides, structures which no rational person would buy or want to live in, structures — in so many instances — which no one ever has lived in or likely ever will. They’ll sit there for decades, some of them, monuments to greed.