10 ms·

New US homeownership measure puts people first

208 points by throw0101a 3mo ago

the_real_cher 3mo ago
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usainvasion 3mo ago
[flagged]
- the_real_cher 3mo ago
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  - whatisanation 3mo ago
    [dead]
- mothballed 3mo ago
  What's really interesting is the extreme hypocrites like Nigerians that will show up and buy US property but then outlawing you from doing the same thing in their country because they don't want Americans or others doing the thing they did.
  - estearum 3mo ago
    US-migrated Nigerians are driving Nigeria's local home ownership policy? Why? How? It seems more likely what you're seeing is the kindred spirit between parochialists of all colors. And if only they could see through the "colors" part they'd realize they're not so different after all.
    - mothballed 3mo ago
      President Asiwaju Bola Ahmed Adekunle Tinubu was literally a US-migrated Nigerian, studying here for college and then working. Maybe you are not familiar with Nigeria, but a surprisingly large amount of those with legislative power have lived or held property in the US. You don't even have to "migrate" to buy property here, just show up, and you can leave (or do it remotely). Tinubu arrived in the United States in 1975, where he commenced undergraduate studies first at Richard J. Daley College in Chicago and then at Chicago State University where he majored in accounting and management. He worked odd jobs as a dishwasher, night security guard and cab driver to support himself through college.[13] He made the honor dean's list as an undergraduate and taught remedial class tutorials, some of his classmates credited his lectures for their improved grades. Tinubu was the university accounting society president in his senior year. His cumulative GPA was 3.54.[13] Tinubu graduated summa cum laude with a Bachelor of Science in Business Administration in 1979.[14][15] Early career After graduating, Tinubu worked as an accountant for the American companies Arthur Andersen, Deloitte and GTE Services Corporation.[16][17]
      - JumpCrisscross 3mo ago
        > a surprisingly large amount of those with legislative power have lived or held property in the US Is this an evangelical thing? Or is something else going on?
        mothballed 3mo ago
        It's a thing in all of Africa. Even a bunch of the crazy Liberian warlord guys were US educated. Maybe less so today but anybody with money in Africa used to migrate to the US to study and then come back with the prestige of the credentials.
        bluGill 3mo ago
        Anyone with money in a country with poor education will try to send their kids to a country with good education. That has been mostly the US over the past 100 years, but there are several other countries (most of the EU) that also have great schools that sometimes get them as well. People with money in a poor country tend to be politically powerful, so it is not surprise their get their kids into power.
      - estearum 3mo ago
        Super interesting! Wasn't familiar, though I admit I didn't even think of ruling class Nigerians (which as you point out, the entire world sends their elite children here to be educated), and was thinking more of "actual" immigrants. I think there's a big difference – on virtually very dimension – between royalty/heirs/elites getting sent to Harvard and back home as compared to someone who actually uproots their life in a one-shot chance to create a new home in America. I'm not sure I'd characterize the former as a type of "hypocrisy" though. They're doing exactly what they set out to do, which is to go learn about what works elsewhere in the world and try to apply it back home. Sometimes for evil purposes and sometimes for pro-social ones.
- rvz 3mo ago
  You mean they are building homes for AI agents? They now live in the data centers, taking your jobs. That is what the Big Tech companies and the Big AI companies are paying for.
bell-cot 3mo ago
No mention of vacation homes, homeless people, or some other situations - but their new metric appears to treat those properly. (Yes, I saw the reference to dorms, nursing homes, & prisons.)
- deleted 3mo ago
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azath92 3mo ago
Looking at the statistics that are used to measure growth and performance at a population level are such a great window into how they themselves are opinionated stances. The two measures are both great measures of house ownership that measure different things. The article frames the second one as better, and if you are looking to see the ownership proportion of people (for example as they note to look at the numbers of young people who live with parents) thats great. If however you care about the housing development decisions that will incentivise owner occupancy you might care more about the standard owner occupancy per household. I often see this with respect to GDP/GDP per capita vs mean income and other economic measures, but its great to see a non economic measure like this compared in this way.
- ajross 3mo ago
  > If however you care about the housing development decisions that will incentivise owner occupancy Genuine question: who, precisely, cares about "incentivising owner occupancy" as a policy goal? What interest does that serve and why should the government prioritize maximizing that metric? Basically right now we measure "what fraction of homes are occupied by an owner" and not "what fraction of people live in their own home?". It seems bleedingly obvious that the latter is the number we should be maximizing, if either. And in particular it seems to me that a lot of argument about the former is actually using it as a proxy for the latter anyway. No one cares about the poor homes who don't have local owners!
  - estearum 3mo ago
    The theory behind it is that 1) economic growth generally accrues to land values so distributing land ownership is one way to distribute wealth and 2) people generally treat the things they own better than the things they rent or consume. Incentivizing ownership is more closely aligned with objective (1) while owner-occupancy is more closely aligned with objective (2). These don't work in the presence of capital's outsized returns though, which allows people who (for whatever reason) have access to more capital to recursively seize more of the growth in land values from objective (1) and therefore price out objective (2).
maweaver 3mo ago
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Aurornis 3mo ago
TL;DR: Instead of measuring the percentage of homes that are owned by people who live there, they want to measure the percentage of adults who own a home. Feels like an apples and oranges situation. The two numbers each have their own value but they’re measuring different things. One is calculated based on the number of houses, the other is a measured based on the population of adults or households. Both measures have always existed. Trying to replace one with the other doesn’t seem right because they both have value for different reasons.
- bluGill 3mo ago
  Both also make the assumption that owning a house is good. Renting should be just as good.
  - an0malous 3mo ago
    Why? It’s a position of less security and stability
    - Jtarii 3mo ago
      Renting is significantly less risky from a financial standpoint.
    - jmye 3mo ago
      [dead]
    - footy 3mo ago
      Personally, I like the asset diversification that investing 40% of my income allows. Buying a house at this point in my life would mean a very significant portion of my net worth would be concentrated in one asset, and I'd have less cash flow every month to boot. I don't feel my rental situation in either insecure or unstable. I recently moved (my choice) but previously I lived in the same rental complex for almost a decade. I took advantage of COVID to move to a larger apartment there for cheaper rent, which was a massive advantage I had over friends who owned homes at the time.
  - 3mo ago
yoshitha2010 3mo ago
[flagged]
pmnelson 3mo ago
Another similarly flawed measure is household income (https://en.wikipedia.org/wiki/Household_income_in_the_United_States https://en.wikipedia.org/wiki/Household_income_in_the_United...), which is used frequently as a measure of socio-economic class. Under this measure, a single adult making $90k and a household of two adults and two children making $90k combined are treated equally, which has always struck me as quite stupid.
- giancarlostoro 3mo ago
  If both parents work they're also easily spending roughly 30+ grand a year on daycare alone. The DCFSA can help, but its tapped out at 7500 atm, which is cute, but unrealistic. A real daycare following all the best standards is not cheap, its like a second mortgage. I can see a major difference in my daughter coming back from daycare, I mean she knows things I don't think I knew when I was her age...
  - AbsurdCensor 3mo ago
    > If both parents work they're also easily spending roughly 30+ grand a year on daycare alone. Depends on how old the kids are, because at least in most cases, daycare costs are for a very short period of time compared to the the overall life of the child. And the average in most states is wildly all over the place. We absolutely should be focused on free childcare, or ideally ways that parents don't need childcare to begin with, but I don't think that has a lot to do with household income. Hell, at that point, why as well talk about transportation costs, as it's different in a single household vs a two parent two kid household, and different still depending on where you live.
    - giancarlostoro 3mo ago
      I'm thinking mainly infants to preschool age, but that is fair, and I'm going by Florida... I can't imagine other states.
GodelNumbering 3mo ago
There was a youtube video sometime ago that argued about how life has vastly improved in every single aspect (with numbers about how 'stuff' has gotten universally more affordable), only housing has gotten more expensive relative to income and how that proves we have a better quality of life because of that. It got me thinking that maybe the home ownership, or having a place you can call yours, disproportionately affects people's sense of content and wellbeing. Also, doesn't help that laws and government policy heavily favor home owners (perhaps because home owners vote at a lot higher rate than renters)
- deleted 3mo ago
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- applfanboysbgon 3mo ago
  Singapore is surveyed as either the happiest or second-happiest country in Asia (IIRC), with at one point a >95% homeownership rate due to government policy (although I believe that's now closer to 90%, in part due to foreign immigration?). It seems self-evident that having a home is somewhere on the order of 1000000x more important than being able to buy lots of cheap junk that barely matters.
  - sarchertech 3mo ago
    A lot of that cheap junk is clothing and food, which now both make up a much lower percentage of total income than they did 100 years ago.
    - usui 3mo ago
      What's the point of being able to spend less on cheap junk if the surplus is eaten up and outspent by important things that inflated during that timespan?
      - inigyou 3mo ago
        And you don't even have a choice. If junk was expensive and houses were cheap, you could scale your junk consumption. You can't scale your house consumption.
redwood 3mo ago
Everything in the study makes perfect sense. However one thing that's not discussed is change in culture and expectations. For example the United States is probably the only country where there's a general expectation that grandparents parents and adult children all live in separate homes... and most other countries multi-generation living is the norm. And perhaps some of those norms are starting to float into the United states. On the other hand no doubt the fact that people are not able to live to the traditional American norm is contributing to malaise. Still it feels a little simplistic to characterize everyone's goal is having their own home. Maybe a way to handle this better would be to look at the size of the home because if a home can easily fit multiple generations it feels like a very different situation. Also it's somewhat arbitrary who happens to be the owner on the deed not to mention key questions like whether or not the home is truly owned outright versus largely in debt to a mortgage
- jltsiren 3mo ago
  There is not much difference between the US and Europe in that. In the Nordic countries, children move out earlier, while multi-generational households are more common in Southern Europe.
- ryukoposting 3mo ago
  I think you have some valid criticisms, but we have to take baby steps here. As you mentioned, multi-generation homes are not the norm in the US. If there is a change in that norm, it's worth investigating why that's happening, before we conclude that we need to adjust metrics around it. Purely anecdotal, but every multi-generation home in my (American) family is the result of disability or student loan debt - multiple generations live together, but that doesn't mean they want to. Also remember that this new metric is meant to be more informative on wealth, generally. Those other generations living in the home don't typically share in the wealth the home confers, not until someone dies at least.
- peteey 3mo ago
  Right now adult Americans can freely chose to live with their parents, and overwhelmingly chose not to. The article links ownership to costs. Attributing diminishing ownership as "norm float" needs some justification. I suspect multi-generational norms seen elsewhere are rooted in poverty and a lack of opportunity. Suppose I told you I am losing weight because I cannot afford food, I don't think you should speculate I chose to go on a diet.
rayiner 3mo ago
This isn’t “putting people first,” it’s baking in the cultural assumption that adults live separately from kin. Consider the examples: > Housing unit 1. A couple owns their home. The woman’s parents live with them. > Housing unit 2. A couple owns their home. Their son, a recent college graduate, lives with them. > Housing unit 3. A man owns his home. A friend lives with him. > Housing unit 4. A couple owns their home. Their two young children live with them. > Housing unit 5. Three roommates rent their home. The owner lives elsewhere. > As illustrated in Figure 1, these five housing units are home to 14 adults. Because four of these five housing units have their respective owners as residents, the owner-occupancy rate—the measure traditionally viewed as the homeownership rate—on the cul-de-sac is 80 percent. However, because only seven of the 14 adults are actually owners of the homes they live in, the HPOP is much lower, at 50 percent. I think 1, 2, and 4 should all count as “owning their home.” The new measure is also a recipe for confounding attempts to compare the metrics over time, as demographic change brings in cultures that embrace multi-generational living. So what seems to be a drop in homeownership rate could instead reflect a growing and aging sub-population where the cultural preference is for parents to live with adult children instead of separately.
- busterarm 3mo ago
  Also the whole thing is just weird to me. The woman's parents, the kid just out of the college and the two young children aren't going to be paying the mortgage, upkeep and property taxes. Once those stop getting paid, none of those people are housed. This is tracking things that don't matter.
- dachworker 3mo ago
  It's an economic metric, not a political statement.
  - rayiner 3mo ago
    The article touts that it’s a “homeownership measure [that] puts people first,” which seems like it’s trying to at least be politically relevant.
- 3mo ago
xyzelement 3mo ago
Perhaps this measure is useful to something but I find it directionally annoying as I don't think "higher is better" as it would be with the more traditional metric. Here's an example from the page - a couple and the wife's parents - a couple and their college grad son In this example the two couples (4 people) are counted as home owners and the 3 others (wife's parents, the son) as non owners - so the ownership rate is 4/7 = 57%. On the traditional metric that scenario would be 100% because roughly each family owns its home which is good. Now look at what would have to happen for the new rate to move to 100 - the wife's parents and the son would need to move out and buy separate homes. In other words the metric "punishes" living with family even if that's what you want to do. I find the traditional metric is more useful. If I am a renter that indicates the desire to have a separate place - so it makes more sense to "ding" the ownership metric.
- idbnstra 3mo ago
  i think it would be best just to do a survey asking what housing situation they are in and if that's what they want. do you really think that every single renter wants to be a renter?
  - alistairSH 3mo ago
    Of course not, but many do - it generally doesn't make sense to buy if you won't stay for a longer period of time (used to be ~7 years, not sure if that's shifted) due to closing costs, interest on loans, etc.
- alistairSH 3mo ago
  Yeah, I'm leaning towards this new metric could actually be harmful (assuming the government goal is to increase it). It makes sense for some families to cohabitate. Family with infants cohabitating with grandparents providing some care. Elderly parents being cared for my their middle-aged "kids". Etc.
tndibona 3mo ago
Actually I don't think this metric goes far enough. In my opinion a homeowner should "own" their home. I.e should have majority equity in his or her home. An owner who pays 3% down is basically a risk bearer for the bank. The bank really owns the majority and is renting out the "owner". I don't think my opinion is fringe. It does measure the risks of not being able to make rent and getting evicted.
- bell-cot 3mo ago
  Yes. Unfortunately, the Minneapolis Fed would get a whole lotta push-back if they suggested any such metric. That risk bearing & interest-rent is a near-perfect way for the 0.01% to milk the "could afford a house" demographic.
- ozgrakkurt 3mo ago
  50 year mortgage incoming to raise the home ownership rate to 90%
- SpicyLemonZest 3mo ago
  That's not a useful metric, because the mortgage interest deduction means that it's almost always financially optimal to take out a mortgage even if you have the assets to pay cash.
  - tndibona 3mo ago
    Point taken. But surely there must be a way to account for that. Can we assume if the net asset value of the individual is greater than the value of the house by some percentage? Then they are owners instead of renters.
randusername 3mo ago
I find it hard to trust economic narratives when so many metrics cited upon further inspection do not really measure what they are implied to measure. Or maybe we measure what is easiest to measure, not what is best. I see this everywhere, though. Jobs data is really job openings not actual hires. Unemployment data is really paperwork filing not people out of work or retiring early. And now home ownership is really "count everyone in the home if the owner resides there".
- RationPhantoms 3mo ago
  To your last point, the Minneapolis Fed just put out a call for a new actual-owner backed housing occupancy rate called HPOP which I think is a step in the right direction: https://www.minneapolisfed.org/article/2026/new-homeownership-measure-puts-people-first https://www.minneapolisfed.org/article/2026/new-homeownershi...
  - wasabi991011 3mo ago
    Are you aware that you are linking to TFA of this exact hackernews post?
- cfbradford 3mo ago
  > "count everyone in the home if the owner resides there" It’s even worse than that, it’s not counting people at all. It’s number of houses with at least one owner living there divided by total number of houses.
whack 3mo ago
> the U.S. homeownership rate is 53 percent I hope this number drops below 50%. Well below 50%. Maybe then we can finally vote down the NIMBY regulations and NIMBY politicians. And start rapidly expanding our housing supply. Given our current political system, it seems high homeownership rates are the root cause of the housing affordability crisis
- deleted 3mo ago
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getoutjew 3mo ago
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OrvalWintermute 3mo ago
I’m happy to see our metrics being improved because much of the economic policy seems to have been based around what was good for boomers. Not what was good for young people who, for the most part, can’t afford to live in houses and these days are getting ripped off with overly expensive apartments too, so they never have a chance to buy a house and build equity.
ecshafer 3mo ago
Housing can not be a viable asset class, or it will continue to rise in prices. Step 1 is Land Value Taxes. Step 2 is remove/greatly reduce zoning, allow construction and streamline the process. If you allow density, building up, and incentivize it, then it will be built. Developers spend tens of thousands of dollars in permits and interest payments before they can put a shovel in the ground. Being a landlord isn't really an issue, morally, ethically, or with regards to people buying houses. The issue is when there are limited number of units, and people turn them into investments.
- mchusma 3mo ago
  The issue is not investment at all, we want more investment into housing. But you are absolutely correct you cannot both want housing to be a good investment (increase in value faster than inflation) and an affordable (drop in price lower than inflation). Don’t subsidize demand. Allow more supply. Private homeowners, big developers, all of the above. Build.
  - vablings 3mo ago
    The issue is that housing should not be an investment but due to rising labor and materials costs and also more restrictive code, they are now an investment.
    - jameshart 3mo ago
      Housing - more generally real estate property - can absolutely be a legitimate asset class, sustaining speculation and global investment; that is how we get capital invested in building out housing infrastructure. But you shouldn’t have to make a leveraged loan-backed investment in a single asset class in order to afford shelter. The problem isn’t ’housing is an investment’, it’s that people are long not on ‘housing’ but on their own single specific house. That’s a horrendously undiversified portfolio.
    - bombcar 3mo ago
      Housing should be an investment; you should be encouraged to invest in where you live and improve both your property and the area around you. It should not be a good investment - it should, over time, boil down to below inflation once you take maintenance and taxes into consideration.
BeetleB 3mo ago
Looking at this, seeing that 50% are homeowners is actually astoundingly good. In a lot of countries 50% cannot afford to be homeowners. This is an international community here on HN, would love to hear takes from other countries.
- vinyl7 3mo ago
  Instead of praising a mediocre number, maybe we should strive to make that number 90%
  - BeetleB 3mo ago
    50% is anything but mediocre.
  - therealdrag0 3mo ago
    Why is ownership a goal? Housing is the goal.
- em-bee 3mo ago
  that number does not feel right. global statistics show only very few countries with a homeownership of less than 50%, two of which are germany and switzerland. and there it's not because they can't afford it but because the cities where people want to live do not even offer enough properties for sale because the majority of housing is owned by large rental businesses. https://worldpopulationreview.com/country-rankings/home-ownership-by-country https://worldpopulationreview.com/country-rankings/home-owne... the europe average is around 70% and globally i expect it is similar. unfortunately numbers for africa are mostly missing. the few examples there suggest that homeownership is either high, or extremely low, which means you could be correct, but i'd like to see actual numbers. and then it is still a question why it is low. it could be because land is owned by government, tribes or private and not for sale. https://globalhousingdatabase.com/ https://globalhousingdatabase.com/ shows more african countries, with most of them being medium to high. but it also hows high for nigeria, whereas the other statistic shows nigeria with 25%, and south africa and kenya are shown as much lower here compared to above.
readthenotes1 3mo ago
Even worse is the number. When you count, how many people actually own their own home, and don't have a mortgage on it and thus are paying rent in the form of interest and possibly mortgage insurance. I am of course excluding property tax from the ownership- if you fail to pay property tax, you'll find out you really owns your property?.
paulus_magnus2 3mo ago
[Invert, always invert] If you're not a homeowner then "you'll own nothing and be happy", Homes are not #1 best investment asset and they shouldn't be but the world works better if people own homes they live in. It's a matter of not having the most significant part of your life being exposed to the market volatility. Plus it nicely aligns incentives of the neighbourhood. Go and check areas that are mostly rental and see how maintenance (of both homes and infrastructure) is forgotten on the altair of rentmaxxing. Of course if you're at $400k at FAANG, your best investment isn't realestate but for majority of middle class and working class buying your own home, taking a good care of it and passing it to your grandchildren is a very good investment. Also the society benefits. The easiest way to solve the unafordability without putting everyone into negative equity is WFH. Land is only expensive near where traditionally the good jobs are. Just allow people to move to a low cost area, build there and WFH

208 points by throw0101a 3mo ago

the_real_cher 3mo ago

[dead]

usainvasion 3mo ago

[flagged]

the_real_cher 3mo ago
[flagged]
- whatisanation 3mo ago
  [dead]
mothballed 3mo ago
What's really interesting is the extreme hypocrites like Nigerians that will show up and buy US property but then outlawing you from doing the same thing in their country because they don't want Americans or others doing the thing they did.
- estearum 3mo ago
  US-migrated Nigerians are driving Nigeria's local home ownership policy? Why? How? It seems more likely what you're seeing is the kindred spirit between parochialists of all colors. And if only they could see through the "colors" part they'd realize they're not so different after all.
  - mothballed 3mo ago
    President Asiwaju Bola Ahmed Adekunle Tinubu was literally a US-migrated Nigerian, studying here for college and then working. Maybe you are not familiar with Nigeria, but a surprisingly large amount of those with legislative power have lived or held property in the US. You don't even have to "migrate" to buy property here, just show up, and you can leave (or do it remotely). Tinubu arrived in the United States in 1975, where he commenced undergraduate studies first at Richard J. Daley College in Chicago and then at Chicago State University where he majored in accounting and management. He worked odd jobs as a dishwasher, night security guard and cab driver to support himself through college.[13] He made the honor dean's list as an undergraduate and taught remedial class tutorials, some of his classmates credited his lectures for their improved grades. Tinubu was the university accounting society president in his senior year. His cumulative GPA was 3.54.[13] Tinubu graduated summa cum laude with a Bachelor of Science in Business Administration in 1979.[14][15] Early career After graduating, Tinubu worked as an accountant for the American companies Arthur Andersen, Deloitte and GTE Services Corporation.[16][17]
    - JumpCrisscross 3mo ago
      > a surprisingly large amount of those with legislative power have lived or held property in the US Is this an evangelical thing? Or is something else going on?
      - mothballed 3mo ago
        It's a thing in all of Africa. Even a bunch of the crazy Liberian warlord guys were US educated. Maybe less so today but anybody with money in Africa used to migrate to the US to study and then come back with the prestige of the credentials.
      - bluGill 3mo ago
        Anyone with money in a country with poor education will try to send their kids to a country with good education. That has been mostly the US over the past 100 years, but there are several other countries (most of the EU) that also have great schools that sometimes get them as well. People with money in a poor country tend to be politically powerful, so it is not surprise their get their kids into power.
    - estearum 3mo ago
      Super interesting! Wasn't familiar, though I admit I didn't even think of ruling class Nigerians (which as you point out, the entire world sends their elite children here to be educated), and was thinking more of "actual" immigrants. I think there's a big difference – on virtually very dimension – between royalty/heirs/elites getting sent to Harvard and back home as compared to someone who actually uproots their life in a one-shot chance to create a new home in America. I'm not sure I'd characterize the former as a type of "hypocrisy" though. They're doing exactly what they set out to do, which is to go learn about what works elsewhere in the world and try to apply it back home. Sometimes for evil purposes and sometimes for pro-social ones.
rvz 3mo ago
You mean they are building homes for AI agents? They now live in the data centers, taking your jobs. That is what the Big Tech companies and the Big AI companies are paying for.

bell-cot 3mo ago

No mention of vacation homes, homeless people, or some other situations - but their new metric appears to treat those properly. (Yes, I saw the reference to dorms, nursing homes, & prisons.)

deleted 3mo ago
[deleted]

azath92 3mo ago

Looking at the statistics that are used to measure growth and performance at a population level are such a great window into how they themselves are opinionated stances. The two measures are both great measures of house ownership that measure different things. The article frames the second one as better, and if you are looking to see the ownership proportion of people (for example as they note to look at the numbers of young people who live with parents) thats great. If however you care about the housing development decisions that will incentivise owner occupancy you might care more about the standard owner occupancy per household. I often see this with respect to GDP/GDP per capita vs mean income and other economic measures, but its great to see a non economic measure like this compared in this way.

ajross 3mo ago
> If however you care about the housing development decisions that will incentivise owner occupancy Genuine question: who, precisely, cares about "incentivising owner occupancy" as a policy goal? What interest does that serve and why should the government prioritize maximizing that metric? Basically right now we measure "what fraction of homes are occupied by an owner" and not "what fraction of people live in their own home?". It seems bleedingly obvious that the latter is the number we should be maximizing, if either. And in particular it seems to me that a lot of argument about the former is actually using it as a proxy for the latter anyway. No one cares about the poor homes who don't have local owners!
- estearum 3mo ago
  The theory behind it is that 1) economic growth generally accrues to land values so distributing land ownership is one way to distribute wealth and 2) people generally treat the things they own better than the things they rent or consume. Incentivizing ownership is more closely aligned with objective (1) while owner-occupancy is more closely aligned with objective (2). These don't work in the presence of capital's outsized returns though, which allows people who (for whatever reason) have access to more capital to recursively seize more of the growth in land values from objective (1) and therefore price out objective (2).

maweaver 3mo ago

[flagged]

Aurornis 3mo ago

TL;DR: Instead of measuring the percentage of homes that are owned by people who live there, they want to measure the percentage of adults who own a home. Feels like an apples and oranges situation. The two numbers each have their own value but they’re measuring different things. One is calculated based on the number of houses, the other is a measured based on the population of adults or households. Both measures have always existed. Trying to replace one with the other doesn’t seem right because they both have value for different reasons.

bluGill 3mo ago
Both also make the assumption that owning a house is good. Renting should be just as good.
- an0malous 3mo ago
  Why? It’s a position of less security and stability
  - Jtarii 3mo ago
    Renting is significantly less risky from a financial standpoint.
  - jmye 3mo ago
    [dead]
  - footy 3mo ago
    Personally, I like the asset diversification that investing 40% of my income allows. Buying a house at this point in my life would mean a very significant portion of my net worth would be concentrated in one asset, and I'd have less cash flow every month to boot. I don't feel my rental situation in either insecure or unstable. I recently moved (my choice) but previously I lived in the same rental complex for almost a decade. I took advantage of COVID to move to a larger apartment there for cheaper rent, which was a massive advantage I had over friends who owned homes at the time.
- 3mo ago

yoshitha2010 3mo ago

[flagged]

pmnelson 3mo ago

Another similarly flawed measure is household income (https://en.wikipedia.org/wiki/Household_income_in_the_United_States https://en.wikipedia.org/wiki/Household_income_in_the_United...), which is used frequently as a measure of socio-economic class. Under this measure, a single adult making $90k and a household of two adults and two children making $90k combined are treated equally, which has always struck me as quite stupid.

giancarlostoro 3mo ago
If both parents work they're also easily spending roughly 30+ grand a year on daycare alone. The DCFSA can help, but its tapped out at 7500 atm, which is cute, but unrealistic. A real daycare following all the best standards is not cheap, its like a second mortgage. I can see a major difference in my daughter coming back from daycare, I mean she knows things I don't think I knew when I was her age...
- AbsurdCensor 3mo ago
  > If both parents work they're also easily spending roughly 30+ grand a year on daycare alone. Depends on how old the kids are, because at least in most cases, daycare costs are for a very short period of time compared to the the overall life of the child. And the average in most states is wildly all over the place. We absolutely should be focused on free childcare, or ideally ways that parents don't need childcare to begin with, but I don't think that has a lot to do with household income. Hell, at that point, why as well talk about transportation costs, as it's different in a single household vs a two parent two kid household, and different still depending on where you live.
  - giancarlostoro 3mo ago
    I'm thinking mainly infants to preschool age, but that is fair, and I'm going by Florida... I can't imagine other states.

GodelNumbering 3mo ago

There was a youtube video sometime ago that argued about how life has vastly improved in every single aspect (with numbers about how 'stuff' has gotten universally more affordable), only housing has gotten more expensive relative to income and how that proves we have a better quality of life because of that. It got me thinking that maybe the home ownership, or having a place you can call yours, disproportionately affects people's sense of content and wellbeing. Also, doesn't help that laws and government policy heavily favor home owners (perhaps because home owners vote at a lot higher rate than renters)

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applfanboysbgon 3mo ago
Singapore is surveyed as either the happiest or second-happiest country in Asia (IIRC), with at one point a >95% homeownership rate due to government policy (although I believe that's now closer to 90%, in part due to foreign immigration?). It seems self-evident that having a home is somewhere on the order of 1000000x more important than being able to buy lots of cheap junk that barely matters.
- sarchertech 3mo ago
  A lot of that cheap junk is clothing and food, which now both make up a much lower percentage of total income than they did 100 years ago.
  - usui 3mo ago
    What's the point of being able to spend less on cheap junk if the surplus is eaten up and outspent by important things that inflated during that timespan?
    - inigyou 3mo ago
      And you don't even have a choice. If junk was expensive and houses were cheap, you could scale your junk consumption. You can't scale your house consumption.

redwood 3mo ago

Everything in the study makes perfect sense. However one thing that's not discussed is change in culture and expectations. For example the United States is probably the only country where there's a general expectation that grandparents parents and adult children all live in separate homes... and most other countries multi-generation living is the norm. And perhaps some of those norms are starting to float into the United states. On the other hand no doubt the fact that people are not able to live to the traditional American norm is contributing to malaise. Still it feels a little simplistic to characterize everyone's goal is having their own home. Maybe a way to handle this better would be to look at the size of the home because if a home can easily fit multiple generations it feels like a very different situation. Also it's somewhat arbitrary who happens to be the owner on the deed not to mention key questions like whether or not the home is truly owned outright versus largely in debt to a mortgage

jltsiren 3mo ago
There is not much difference between the US and Europe in that. In the Nordic countries, children move out earlier, while multi-generational households are more common in Southern Europe.
ryukoposting 3mo ago
I think you have some valid criticisms, but we have to take baby steps here. As you mentioned, multi-generation homes are not the norm in the US. If there is a change in that norm, it's worth investigating why that's happening, before we conclude that we need to adjust metrics around it. Purely anecdotal, but every multi-generation home in my (American) family is the result of disability or student loan debt - multiple generations live together, but that doesn't mean they want to. Also remember that this new metric is meant to be more informative on wealth, generally. Those other generations living in the home don't typically share in the wealth the home confers, not until someone dies at least.
peteey 3mo ago
Right now adult Americans can freely chose to live with their parents, and overwhelmingly chose not to. The article links ownership to costs. Attributing diminishing ownership as "norm float" needs some justification. I suspect multi-generational norms seen elsewhere are rooted in poverty and a lack of opportunity. Suppose I told you I am losing weight because I cannot afford food, I don't think you should speculate I chose to go on a diet.

rayiner 3mo ago

This isn’t “putting people first,” it’s baking in the cultural assumption that adults live separately from kin. Consider the examples: > Housing unit 1. A couple owns their home. The woman’s parents live with them. > Housing unit 2. A couple owns their home. Their son, a recent college graduate, lives with them. > Housing unit 3. A man owns his home. A friend lives with him. > Housing unit 4. A couple owns their home. Their two young children live with them. > Housing unit 5. Three roommates rent their home. The owner lives elsewhere. > As illustrated in Figure 1, these five housing units are home to 14 adults. Because four of these five housing units have their respective owners as residents, the owner-occupancy rate—the measure traditionally viewed as the homeownership rate—on the cul-de-sac is 80 percent. However, because only seven of the 14 adults are actually owners of the homes they live in, the HPOP is much lower, at 50 percent. I think 1, 2, and 4 should all count as “owning their home.” The new measure is also a recipe for confounding attempts to compare the metrics over time, as demographic change brings in cultures that embrace multi-generational living. So what seems to be a drop in homeownership rate could instead reflect a growing and aging sub-population where the cultural preference is for parents to live with adult children instead of separately.

busterarm 3mo ago
Also the whole thing is just weird to me. The woman's parents, the kid just out of the college and the two young children aren't going to be paying the mortgage, upkeep and property taxes. Once those stop getting paid, none of those people are housed. This is tracking things that don't matter.
dachworker 3mo ago
It's an economic metric, not a political statement.
- rayiner 3mo ago
  The article touts that it’s a “homeownership measure [that] puts people first,” which seems like it’s trying to at least be politically relevant.
3mo ago

xyzelement 3mo ago

Perhaps this measure is useful to something but I find it directionally annoying as I don't think "higher is better" as it would be with the more traditional metric. Here's an example from the page - a couple and the wife's parents - a couple and their college grad son In this example the two couples (4 people) are counted as home owners and the 3 others (wife's parents, the son) as non owners - so the ownership rate is 4/7 = 57%. On the traditional metric that scenario would be 100% because roughly each family owns its home which is good. Now look at what would have to happen for the new rate to move to 100 - the wife's parents and the son would need to move out and buy separate homes. In other words the metric "punishes" living with family even if that's what you want to do. I find the traditional metric is more useful. If I am a renter that indicates the desire to have a separate place - so it makes more sense to "ding" the ownership metric.

idbnstra 3mo ago
i think it would be best just to do a survey asking what housing situation they are in and if that's what they want. do you really think that every single renter wants to be a renter?
- alistairSH 3mo ago
  Of course not, but many do - it generally doesn't make sense to buy if you won't stay for a longer period of time (used to be ~7 years, not sure if that's shifted) due to closing costs, interest on loans, etc.
alistairSH 3mo ago
Yeah, I'm leaning towards this new metric could actually be harmful (assuming the government goal is to increase it). It makes sense for some families to cohabitate. Family with infants cohabitating with grandparents providing some care. Elderly parents being cared for my their middle-aged "kids". Etc.

tndibona 3mo ago

Actually I don't think this metric goes far enough. In my opinion a homeowner should "own" their home. I.e should have majority equity in his or her home. An owner who pays 3% down is basically a risk bearer for the bank. The bank really owns the majority and is renting out the "owner". I don't think my opinion is fringe. It does measure the risks of not being able to make rent and getting evicted.

bell-cot 3mo ago
Yes. Unfortunately, the Minneapolis Fed would get a whole lotta push-back if they suggested any such metric. That risk bearing & interest-rent is a near-perfect way for the 0.01% to milk the "could afford a house" demographic.
ozgrakkurt 3mo ago
50 year mortgage incoming to raise the home ownership rate to 90%
SpicyLemonZest 3mo ago
That's not a useful metric, because the mortgage interest deduction means that it's almost always financially optimal to take out a mortgage even if you have the assets to pay cash.
- tndibona 3mo ago
  Point taken. But surely there must be a way to account for that. Can we assume if the net asset value of the individual is greater than the value of the house by some percentage? Then they are owners instead of renters.

randusername 3mo ago

I find it hard to trust economic narratives when so many metrics cited upon further inspection do not really measure what they are implied to measure. Or maybe we measure what is easiest to measure, not what is best. I see this everywhere, though. Jobs data is really job openings not actual hires. Unemployment data is really paperwork filing not people out of work or retiring early. And now home ownership is really "count everyone in the home if the owner resides there".

RationPhantoms 3mo ago
To your last point, the Minneapolis Fed just put out a call for a new actual-owner backed housing occupancy rate called HPOP which I think is a step in the right direction: https://www.minneapolisfed.org/article/2026/new-homeownership-measure-puts-people-first https://www.minneapolisfed.org/article/2026/new-homeownershi...
- wasabi991011 3mo ago
  Are you aware that you are linking to TFA of this exact hackernews post?
cfbradford 3mo ago
> "count everyone in the home if the owner resides there" It’s even worse than that, it’s not counting people at all. It’s number of houses with at least one owner living there divided by total number of houses.

whack 3mo ago

> the U.S. homeownership rate is 53 percent I hope this number drops below 50%. Well below 50%. Maybe then we can finally vote down the NIMBY regulations and NIMBY politicians. And start rapidly expanding our housing supply. Given our current political system, it seems high homeownership rates are the root cause of the housing affordability crisis

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getoutjew 3mo ago

[flagged]

OrvalWintermute 3mo ago

I’m happy to see our metrics being improved because much of the economic policy seems to have been based around what was good for boomers. Not what was good for young people who, for the most part, can’t afford to live in houses and these days are getting ripped off with overly expensive apartments too, so they never have a chance to buy a house and build equity.

ecshafer 3mo ago

Housing can not be a viable asset class, or it will continue to rise in prices. Step 1 is Land Value Taxes. Step 2 is remove/greatly reduce zoning, allow construction and streamline the process. If you allow density, building up, and incentivize it, then it will be built. Developers spend tens of thousands of dollars in permits and interest payments before they can put a shovel in the ground. Being a landlord isn't really an issue, morally, ethically, or with regards to people buying houses. The issue is when there are limited number of units, and people turn them into investments.

mchusma 3mo ago
The issue is not investment at all, we want more investment into housing. But you are absolutely correct you cannot both want housing to be a good investment (increase in value faster than inflation) and an affordable (drop in price lower than inflation). Don’t subsidize demand. Allow more supply. Private homeowners, big developers, all of the above. Build.
- vablings 3mo ago
  The issue is that housing should not be an investment but due to rising labor and materials costs and also more restrictive code, they are now an investment.
  - jameshart 3mo ago
    Housing - more generally real estate property - can absolutely be a legitimate asset class, sustaining speculation and global investment; that is how we get capital invested in building out housing infrastructure. But you shouldn’t have to make a leveraged loan-backed investment in a single asset class in order to afford shelter. The problem isn’t ’housing is an investment’, it’s that people are long not on ‘housing’ but on their own single specific house. That’s a horrendously undiversified portfolio.
  - bombcar 3mo ago
    Housing should be an investment; you should be encouraged to invest in where you live and improve both your property and the area around you. It should not be a good investment - it should, over time, boil down to below inflation once you take maintenance and taxes into consideration.

BeetleB 3mo ago

Looking at this, seeing that 50% are homeowners is actually astoundingly good. In a lot of countries 50% cannot afford to be homeowners. This is an international community here on HN, would love to hear takes from other countries.

vinyl7 3mo ago
Instead of praising a mediocre number, maybe we should strive to make that number 90%
- BeetleB 3mo ago
  50% is anything but mediocre.
- therealdrag0 3mo ago
  Why is ownership a goal? Housing is the goal.
em-bee 3mo ago
that number does not feel right. global statistics show only very few countries with a homeownership of less than 50%, two of which are germany and switzerland. and there it's not because they can't afford it but because the cities where people want to live do not even offer enough properties for sale because the majority of housing is owned by large rental businesses. https://worldpopulationreview.com/country-rankings/home-ownership-by-country https://worldpopulationreview.com/country-rankings/home-owne... the europe average is around 70% and globally i expect it is similar. unfortunately numbers for africa are mostly missing. the few examples there suggest that homeownership is either high, or extremely low, which means you could be correct, but i'd like to see actual numbers. and then it is still a question why it is low. it could be because land is owned by government, tribes or private and not for sale. https://globalhousingdatabase.com/ https://globalhousingdatabase.com/ shows more african countries, with most of them being medium to high. but it also hows high for nigeria, whereas the other statistic shows nigeria with 25%, and south africa and kenya are shown as much lower here compared to above.

readthenotes1 3mo ago

Even worse is the number. When you count, how many people actually own their own home, and don't have a mortgage on it and thus are paying rent in the form of interest and possibly mortgage insurance. I am of course excluding property tax from the ownership- if you fail to pay property tax, you'll find out you really owns your property?.

paulus_magnus2 3mo ago

[Invert, always invert] If you're not a homeowner then "you'll own nothing and be happy", Homes are not #1 best investment asset and they shouldn't be but the world works better if people own homes they live in. It's a matter of not having the most significant part of your life being exposed to the market volatility. Plus it nicely aligns incentives of the neighbourhood. Go and check areas that are mostly rental and see how maintenance (of both homes and infrastructure) is forgotten on the altair of rentmaxxing. Of course if you're at $400k at FAANG, your best investment isn't realestate but for majority of middle class and working class buying your own home, taking a good care of it and passing it to your grandchildren is a very good investment. Also the society benefits. The easiest way to solve the unafordability without putting everyone into negative equity is WFH. Land is only expensive near where traditionally the good jobs are. Just allow people to move to a low cost area, build there and WFH