This is fascinating stuff - full disclosure, I’m reading this from the other side of the Atlantic (but we did discover in 2007-8 that events in the US sub-prime mortgage market could be felt elsewhere…)
One point interests me, how much does demographics influence the models or expectations? In the UK I have heard one housing expert predict that UK house prices will fall due to demographics, because so much housing is currently occupied by people in their 70s & 80s. Over the next decade or so the amount of housing that will end up on the market as part of an estate will exceed likely household formation - an interesting idea that contradicts the popular belief in a shortage of housing.
The US appears to have a far younger population with expectations of population growth, but President Trump appears to have totally stopped immigration. That would appear to both have an impact on population growth, but also severely restrict the workforce for home building.
Demographics would be an important factor, as you describe it. In the U.S., I estimate that we are 15-20 million units short of what a population with our income would consume, so the demographic effects are pushed into the future more.
This is fascinating stuff - full disclosure, I’m reading this from the other side of the Atlantic (but we did discover in 2007-8 that events in the US sub-prime mortgage market could be felt elsewhere…)
One point interests me, how much does demographics influence the models or expectations? In the UK I have heard one housing expert predict that UK house prices will fall due to demographics, because so much housing is currently occupied by people in their 70s & 80s. Over the next decade or so the amount of housing that will end up on the market as part of an estate will exceed likely household formation - an interesting idea that contradicts the popular belief in a shortage of housing.
The US appears to have a far younger population with expectations of population growth, but President Trump appears to have totally stopped immigration. That would appear to both have an impact on population growth, but also severely restrict the workforce for home building.
Demographics would be an important factor, as you describe it. In the U.S., I estimate that we are 15-20 million units short of what a population with our income would consume, so the demographic effects are pushed into the future more.
Great read. Please read my latest post on housing advocacy:
https://substack.com/@nogoplus/note/p-176168396?r=6cyw21