EDITOR'S NOTE: One theme we’ve repeated time and again is that government debt, spending, and money printing all constitute a claim on households’ future income and earnings. If the government doesn’t tax you directly, taking a portion of your earnings now, its “hidden taxes” by way of debt and money printing will claim your earnings later. The reason for this is simple: the only form of real revenue a government can produce is through taxation. One trace of this “income drain” is the decline in hopes for homeownership. The Axios article below takes a shallow yet informative dive into this matter. Renters are expecting rents to rise further, yet most are not in a position to ditch renter status for homeownership. Mortgage rates are rising, and home prices, along with the cost of goods and services in general, continue to inflate toward levels not seen since the stagflationary 1970s.
Rising home prices are dampening hopes of homeownership, Hope writes.
Driving the news: The majority of renters asked by the Federal Reserve Bank of New York’s 2022 SCE Housing Survey say they now either prefer to rent (36%) or are waiting for prices to come down (42%).
- As for the likelihood that they would own a home in the future, the annual survey found that this average has fallen to a series low and well below 50% for the first time since the series began.
What to watch: Renters expect rents to rise by 12.8% one year from now, compared to 5.9% a year ago.
Originally published by Axios.