Tuesday, September 18, 2012

Andrew Oswald and I debate the merits of homeownership in The Economist

Ryan Avent moderates:

The view of home-ownership as a pillar of economic and social welfare is deeply ingrained across much of the rich world. It seems natural to think a household that owns its home is invested in society in a way a renting family never could be. It is bound to be richer, thanks to the ability to accumulate equity. Its members are sure to take a greater interest in the health of their neighbourhood and the quality of local institutions, if only to help protect the value of their property. And because of that interest in property value, home-owners may be more politically active, to help secure sound and stable governance....

Andrew Oswald defends discouraging ownership:


Home-ownership has reached inefficiently high levels; it has become a distorting totem; modern generations have been brainwashed to believe there is something wrong with them if they rent. We do not want developing countries to mimic the West's post-war obsession with owner-occupation.
There are five reasons to discourage home-ownership. Let's call them: look at the data; efficiency of the labour market; macroeconomic stabilisation; sensible lifetime budgeting; entrepreneurial supply; the common sense of diversity...
The motion "Should home-ownership be discouraged?" takes a novel formulation. Generally, the question policymakers ask is whether home-ownership should be encouraged, which suggests that there are social benefits to owning a home. In this case, the affirmative position is that home-ownership should be discouraged. This implies that having people own their homes is socially costly. Thus, my task is to show that home-owning is not socially costly.
I can think of three potentially legitimate arguments for why home-owning might be socially costly; I do not think that any of them are straw men, but I also think that none of them is convincing.




3 comments:

Unknown said...

Logix Blossom Greens Noida offers 2BHK & 3BHK penthouses and villas where the minimum offered area is 860 sq ft and maximum one is 1675 sq ft. and price starting from INR 35.99 lakhs and onwards, at the rate of INR 4186 per sq. ft. This housing community is designed especially for the senior citizen with a dedicated lush green meditation, word class club houses and private lawn for ground floors.

Unknown said...

This Very interesting blog., thanks for sharing...Real Estate Search Seattle

Construction Companies said...

Every one expecting comfortable and affordable home.
Construction Companies in Australia