Several commenters at my econ-related posts during the past several months here at NewsBusters and my home blog have noted how Washington's mix of high deficits, over-regulation, and quantitative easing never seem to get any kind of blame for the economy in establishment press coverage.
One could hardly find a better example of that deliberate avoidance than Josh Boak's writeup today at the Associated Press, aka the Administration's Press, on how "Home ownership ... is increasingly on hold for younger Americans." While he identified several symptoms which could easily be traced to Obama administration and Federal Reserve policies, Boak never tagged anyone who might be responsible, instead acting as if all these adverse conditions just sort of happened and ... oh well, here we are.
Here are lowlights from Boak's report (bolds and numbered tags are mine):
MORE MILLENNIALS STUCK RENTING FOR YEARS BEFORE BUYING HOME
... Short of cash, burdened by student debt and unsettled in their careers, young adults are biding time in apartments for longer periods and buying their first homes later in life. [1]
The typical first-timer now rents for six years before buying, up from 2.6 years in the early 1970s, according to a new analysis by the real estate data firm Zillow. [2] The median first-time buyer is age 33 - in the upper range of the millennial generation, which roughly spans ages 18 to 34. A generation ago, the median first-timer was about three years younger.
The delay reflects a trend that cuts to the heart of the financial challenges facing millennials: Renters are struggling to save for down payments as wages have largely stagnated. Increasingly, too, they're facing delays in some key landmarks of adulthood, from marriage and children to a stable career, according to industry and government reports. [3]
These shifts [4] help explain why homeownership, long a source of middle class identity and economic opportunity, has started to decline. The share of the U.S. population who own homes has slid to 63.4 percent, a 48-year low, according to the Census Bureau.
And when young adults do sign the deed, their purchase price is now substantially more, relative to their income, than it was decades ago.
... Most first-timers still depend on personal savings for at least some of their down payments. But rising rental prices have complicated the task of socking away money for a down payment. Fueled by a surge of renters across all age ranges, rental prices nationally have grown at roughly twice the pace of average hourly wage growth, which was a paltry 2.1 percent over the past year. [5]
A result is that those prices are consuming more income. A striking 46 percent of renters ages 25 to 34 - the core of the millennial population - spend more than 30 percent of their incomes on rent, up from 40 percent a decade earlier, according to a report by Harvard University's Joint Center of Housing Studies.
... Housing industry experts note that surveys still show a strong desire to buy among millennials, but that their timelines for purchasing depend on achieving more stability in their careers.
"As long as there is the job market to support millennials - just as it has for previous generations - I don't believe their habits will change," said Darius Mirshahzadeh, CEO of The Money Source. [6]
Every one of the items with a number tag represented an opportunity for Boak to refer to government policies which have strongly contributed to the related problems:
[1] — Student debt burdens? I wonder who vastly expanded student loans, thereby vastly expanding schools' ability to raise their tuitions and other costs of attendance? Answer: The federal government, particularly the Democrat-dominated Congress during the first half of President Barack Obama's first term.
[2] — Thanks to Dodd-Frank and the nannies at the Consumer Financial Protection Bureau, lenders are afraid to venture even a tiny bit outside of strict financial guidelines for mortgage loan approval. Even longtime homeowners attempting to refinance who would achieve much lower monthly payments as a result of closing a new loan have been forced to jump through ridiculous hoops to prove that they will be afford a home they (obviously) can already afford.
[3] — Stagnant wages? Thank the slow-growth so-called "recovery" for that. Stable career? Thank the non-recovering job market for that. Full-time employment is still below the peak seen before Democrats created the POR (Pelosi-Obama-Reid) economy in late Spring 2008. The economy has never achieved "escape velocity" representing a genuine recovery since its onset.
[4] — "These shifts" are really "primarily government-caused developments."
[5] — Rentals rates have gone up so much that many young adults who would rather not move back in with their parents have had to do so. It's interesting how Boak failed to note that point. That said, one could argue that a person legitimately interested in achieving home ownership would do this — if they had a job paying enough money to enable meaningful saving. But, again thanks to Washington's policies, wage growth is stagnant, and median household incomes are still well below where they were before the recession began.
[6] — Their habits have already changed, Mr. Mirshahzadeh. The question is what will cause them to come back to not only a high level of interest in owning a home, but what will happen to give them a greater ability to do so. There's nothing on the horizon to change this as long as the Obama administration's policies remain in place, and as long as the Fed refuses to allow market-driven interest rates to sort out this mess.
Cross-posted at BizzyBlog.com.
