Economy Today Requires More Rental Housing for a Mobile Workforce
Digested From "Homeownership Is Overrated"Wall Street Journal (06/07/10) by Richard Florida
Richard Florida, author of "The Great Reset: How New Ways of Living and Working Drive Post-Crash Prosperity," writes that owning a home may actually be a drawback in today's economic reality. He notes, "My colleagues and I tracked homeownership levels across U.S. cities and regions to see how they correlate to other measurable demographic and economic factors. As we expected, the rates of homeownership are greatest where housing prices are lowest." However, cities with high levels of homeownership -- in the range of 75 percent like Pittsburgh and St. Louis -- had, on average, significantly lower levels of economic activity and substantially lower wages and incomes. Florida adds, "Far too many people in economically distressed communities are trapped in homes they can't sell, unable to move on to new centers of opportunity. The cities and regions with the lowest levels of homeownership -- in the range of 55 percent to 60 percent like L.A., N.Y., San Francisco and Boulder -- had healthier economies and higher incomes." He goes on to report that those who are not locked into mortgage payments have a greater degree of flexibility and resilience in the face of economic shocks and downturns than those who have a mortgage. Those individuals can downshift as needed or more easily move to take advantage of employment opportunities elsewhere. Florida currently serves as director of the Martin Prosperity Institute at the University of Toronto.
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Independent Study Shows Renting Beats Homeownership
Digested From "76 Percent Think Renting Beats Homeownership"Orange County Register (CA) (06/09/10) by Jon Lansner
The National Apartment Association (NAA) recent commissioned an online survey of more than 2,000 Americans, which found that 76 percent of respondents see renting as a better option than owning a home. Researchers note that is five percentage points better than 2008. The top reason, cited by 64 percent of respondents, why is that major repairs and maintenance issues are left to the rental housing owner. Financial considerations, such as home-value risk and chance of foreclosure, also ranked high. NAA President Douglas Culkin states, "While some may want to declare the housing crisis over, consumer patterns of behavior are showing otherwise. . . . The simple fact remains that in a bad economy, people must make whatever changes necessary to improve their situation, especially if they have lost their job."
