We’ve talked a lot about the historic flashpoint that was 2020. Devastating pandemic. Political strife. Civil unrest. Sudden and abrupt economic distress. There were more than a few bad things to say about the state of things in 2020.
And yet, in stark contrast, 2020 was a record year for the real estate and housing industry. We saw record refinance volume, strong purchase demand and, overall, an incredibly good year for a sector of the economy that many took pleasure in deriding for its role in the 2008 meltdown. Quite the opposite for 2020. Odds are high that if you did business that was impacted in any way by real estate, housing, mortgage or settlement services, your company had a fantastic year in many ways. Housing, in fact, may have played a huge role in keeping the overall U.S. economy from the brink, as well as fueling the quick comeback we seem to be experiencing (inflation notwithstanding).
There are two sides to that boom, however. I recently saw a great article addressing a growing homeownership gap and the likelihood of amplified housing inequality. It appears the boom year for housing didn’t benefit everyone equally. The author describes the problem deftly:
“On one side, many millennials were able to save money after ditching sky-high rents in major cities. This accelerated their ability to buy homes. They and other wealthier buyers began relocating to more cost-effective areas, scooping up property and leading to a hot market with rising prices.
Meanwhile, many lower-income demographics and families of color were hit harder financially by the pandemic. Blue-collar workers who often had no work-from-home option were laid off as companies struggled to stay above water. And on the housing front, lower-income renters began to fall late on payments, pushing back homeownership dreams as they struggled to avoid eviction. Homeowners who lost their jobs, meanwhile, relied on government-imposed foreclosure moratoriums and other financial assistance to stay in their homes.”
Please do check out the article—it’s an insightful read. A short blog posting isn’t really the forum for drilling down too deeply, but the point I believe is tremendously important for all of us to take in. (In fact, we’ll likely address it again here or somewhere like LLL.)
With prosperity and fortune comes responsibility. Especially in a society powered by capitalist ideals. We in the housing industry have experienced the downside of the economy before. But we are blessed to be in the position we are in today. We have an obligation to use that position for a greater good as well—and we can start by taking a stronger and deeper look at what the American Dream means for all Americans, and how our industry can make it easier to achieve. Not just for some of them.
Got an idea for Deeper Thoughts or LLL? Have an example of where our industry could use a bit of clarity? Email me at firstname.lastname@example.org.