Quote of the day...

Even supposedly smart analysts are missing the big picture. In housing, it is this: there are about 20 million unoccupied homes in America. Given average family size, that’s enough for 70 million people, and there aren’t anything like that many people living under bridges.

If about a third of Americans rent (for assorted reasons) that leaves perhaps 200 to 210 million in the home ownership sector. Consequently we have a 35% over-capacity in houses, and for the next half-generation the demographics for house purchase will continue to worsen.

We are a long way from the bottom. After the last big real estate boom peaked in 1893, prices eventually bottomed in the 1930s and did not return to previous levels until 1982 (inflation-adjusted). The phenomenon was nearly identical, whether in the US, Norway, or other developed nations.

The economic, social and political implications of this one will absolutely sear the attitudes of at least the two rising generations.

-Bart Hall
From here.