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- Sep 25, 2007
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Hi all,
An article from the April 18th - 24th edition of The Economist. In a nutshell, not everyone is cut out to be a home owner regardless of the "status" that society places on home ownership and the perceived economic benefits of home ownership aren`t necessarily so. Excerpts:
The social benefits of home ownership look more modest than they did and the economic costs much higher.
So attempts to expand home ownership have contributed to the wider economic crisis without succeeding in their own terms. How does that affect the arguments for supporting home ownership? Should it still be deemed a public good?
No, say several economists and commentators. "Given the way US policy favours owning over renting," writes Paul Krugman, 2008`s Nobel laureate in economics, "you can make a good case that America already has too many homeowners." Edward Glaeser, an economist at Harvard University, talks about "the madness of encouraging Americans to bet everything on housing".
So far, policymakers are unmoved. In mid-February Barack Obama proposed a $275 billion plan to support America`s housing market. Outside the Anglo-Saxon world Nicolas Sarkozy, who campaigned for the presidency to turn France into a property-owning democracy, has expanded zero-interest housing loans for the poor.
The main economic argument for home ownership is that, in the words of Thomas Shapiro of Brandeis University, "it is by far the single most important way families accumulate wealth". This argument now looks as weak as house prices.
http://www.economist.com/finance/displayst...ory_id=13491933
Keith
An article from the April 18th - 24th edition of The Economist. In a nutshell, not everyone is cut out to be a home owner regardless of the "status" that society places on home ownership and the perceived economic benefits of home ownership aren`t necessarily so. Excerpts:
The social benefits of home ownership look more modest than they did and the economic costs much higher.
So attempts to expand home ownership have contributed to the wider economic crisis without succeeding in their own terms. How does that affect the arguments for supporting home ownership? Should it still be deemed a public good?
No, say several economists and commentators. "Given the way US policy favours owning over renting," writes Paul Krugman, 2008`s Nobel laureate in economics, "you can make a good case that America already has too many homeowners." Edward Glaeser, an economist at Harvard University, talks about "the madness of encouraging Americans to bet everything on housing".
So far, policymakers are unmoved. In mid-February Barack Obama proposed a $275 billion plan to support America`s housing market. Outside the Anglo-Saxon world Nicolas Sarkozy, who campaigned for the presidency to turn France into a property-owning democracy, has expanded zero-interest housing loans for the poor.
The main economic argument for home ownership is that, in the words of Thomas Shapiro of Brandeis University, "it is by far the single most important way families accumulate wealth". This argument now looks as weak as house prices.
http://www.economist.com/finance/displayst...ory_id=13491933
Keith