The Housing Crisis is Real – Week 1

Introduction:

Currently, there is a housing crisis in the United States. It is real. A second housing crisis is brewing. Like all crises, they occur when there is a mismatch between supply and demand. In both cases, government regulation has magnified the problem into a crisis.

The existing crisis is in the “starter home” or “first home” housing market created by a combination of demography, The Great Recession, and government regulations. The one that is coming is a crisis that has been created by government regulations encouraging age restricted communities in which only folks over the age of 55 can purchase homes. However well intentioned, that decision by our governments is going to look very stupid in the next two decades as the Boomers continue to die off and are replaced by a smaller generation, Generation X.

In this series of blogs, we are going to explore some of the most important factors that have created and combined to maximize both crises. Only when supply equals demand will the crises disappear. The most important step in the solution is that governments reverse or modify some previous decisions so the marketplace can function.