After World War II, the idea of owning your own home became a Cold War symbol of what it means to be an American. The ideal: Every family could afford to own a homestead. A luxury once available only to the rich and well-connected was distributed to most of the population. It was a symbol of the superiority of capitalism and democracy, a sign that we were doing everything right.
Home ownership and prosperity went together. This was supposed to happen early in life, soon after marriage, to prepare for children and a good life.
Whole federal programs were created to bolster the idea and backstop mortgages financially. The idea likely went too far, but that’s how it goes in the United States. Once policymakers seize on a priority, federal resources are poured into it until the system breaks. That’s exactly what happened in 2008 with the housing crisis. After that, the idea of home ownership became more dicey and risky for many, but ultra-low interest rates kept the ideal alive.
The post-lockdown economy is realizing the WEF goal, with soaring high interest rates and sky-high home prices that only the very well-to-do can afford. Investment in rental properties and apartments is now outpacing home construction, and the homes that remain on the market are being scarfed up by cash-rich buyers who won’t be paying 8 percent interest.
Those with homes now, especially those with fixed-rate mortgages taken out longer than five years ago, are clinging to them for dear life. They are also paying ever-higher property taxes for the privilege. Many people feel locked into their homes. Even if they sell at a huge profit, they face the problem of buying again in a market with a housing shortage, sky-high prices, and soaring interest rates even as real household income is flat and declining.
Renting can be scary because you don’t have control over what kind of inflation premiums the next lease will feature, but it’s the same with property taxes when you own. Once you add up the expenses and fees, it’s not at all obvious that owning these days really is better than renting, especially when you consider how much owning now limits your professional mobility.
The economics of the situation is working to make the WEF dystopia come true. But there is not much to do about it. And this change is profoundly affecting the culture and expectations that we have about the future.
Several years ago, I was wandering around a small town in central Texas and happened upon an estate sale. It was not in a fancy house. It was a moderate-sized home in a fine but not resplendent neighborhood. It was nothing special really. What struck me as I went in was the sheer size and scale of the furniture that had probably sat in that home for some 75 years, since the owner was now passed on. This was the third generation to live in that house. None of the kids wanted the home or the furniture, so it was picked over by the customers who saw the ad on Craigslist.
There were mighty bookshelves that extended the full length of the room, perhaps 12 by 10 feet, with beautiful ornaments on them. Buyers weren’t even slightly interested. It had a high price on it. I knew for sure that it would not sell. They likely had to pay someone to haul it off. The same was true of the massive dining room set. The bedrooms were full of large and heavy cabinets and chests of drawers, plus large poster beds and much more.
Looking around, I could see that no one would buy these things. They are made for homesteads with the expectation that several generations would live there, investments meant to stand the test of time. The idea was that your home is your castle, so the more castle-like things you could put in them, the more the idea came true. I’m not sure that any middle-American homeowner, much less a renter, would ever want to be saddled with any of this today.
It cannot really be ported across the country. It won’t fit in most places today. If you want to keep this stuff for reasons of nostalgia, you are going to pay a very heavy price for it and very likely going to have to haul it to a new place soon or struggle to sell it. In the end, there is not much point, as sad as this seems.
The new model for household furniture is, of course, Ikea. Not to put it down, but most of the items suitable for apartments do not need to be packed up and shipped to a new place when you move. You are likely better off just selling it on some marketplace or dragging it down to the dumpster. Again, this makes economic sense, and I’m not faulting either the buyer or seller. I’m merely noting what a dramatic change this is in American culture and that this change is reflected even in the industry that sells furniture.
Meanwhile, anyone can go to eBay or Facebook Marketplace (not to advertise that site but, truly, that is now the only valuable reason for staying on the platform) and find furniture and paintings that might have been purchased for 100 times to 1,000 times the price 20 years ago and that are now selling for a song even in inflationary times. It’s remarkable. The firesale on fancy furniture began about 10 years ago but has become raging in the past several years.
Renting is truly changing the country, but it is the best option in the midst of extremely high interest rates, demographic upheavals as Americans continue to flee traditional urban centers for Texas and Florida, and industrial changes that are requiring absolute mobility on the part of the professional class. It’s to the point that our expectations have fundamentally changed concerning whether or not we will ever again have anything like what we once called homesteads. Most people in the country are now nomads compared to 50 years ago.
There is truth to the claim that the nation’s housing stock is now being gobbled up by cash-rich institutions that are flipping them over to rental markets. These same institutions are the ones working with big corporations and big finance, adding to the centralization of economic life. The rest of us are slated to live as serfs on barons’ estates, never owning but rather paying out monthly whatever bills come our way.
We’ve traveled a very long way from the postwar ideal of home ownership for everyone. It’s a sign and a symbol of a kind of prosperity that is slipping away from us. You know this if you do the grocery shopping for the family or are otherwise in charge of the bills. Households are being squeezed on all fronts today. Renting instead of owning is the way of the future, which is only one of many conspicuous signs that nothing is as it was.
