I'm not sure this rather dated precept is compatible with the exigencies of 21st century economics, and the flexibility, mobility and long hours demanded.
For one thing, houses are cash sinks. It doesn't make sense for highly paid professionals to spend enormous amounts of time or money reshingling roofs, painting, mowing lawns, treating weeds, trimming hedges, repairing plumbing, etc. The deep specialisation and constant attention that the professional economy asks are orthogonal to all those things. It's prudent to upload those demands to the cloud (aka your landlord, at scale) so to speak.
I know far more urban professionals that were hindered by the ballast of owning real estate than those empowered by this "most basic form of security". Here in the sprawling metro Atlanta area, taking another job will very likely take you to a wholly different part of this vast agglomeration and doom you to a punishing commute unless you sell your house and relocate. The uncertainty, transaction costs and other friction kept a number of people I know in dead-end jobs until they were finally laid off.
As a personal anecdote, I bought a condo in May 2007. I was drinking the very same Kool-Aid about basic form of security and whatnot. I finally let my home go to foreclosure in summer 2015. I financed at $160K, and in summer 2015 it appraised at $85K. I still owed $140K. One of the lenders sued me for a $29K deficiency and got a judgment, and I'll be paying them $250/mo for the next six years. Some security. I grant that my effort at partaking of the most basic form of security a human needs was exceptionally disastrous, but I think the housing crash educated a lot of people about just how much security it really offers. A senseless push to ownership for ownership's sake threatens to discard those valuable lessons.
The real argument for owning vs. renting is the mortgage interest deduction, and that's an artifice of government tax policy that hugely distorts the market and the incentives.
Where did you go rent a place for less than your 160k mortgage?
I agree that owning a house is not right for everyone, but if you're planning on staying in a location for awhile it can make a lot of sense (although ATL is its own special hell). If I had not bought a house in 2011, I actually could not afford to live in the area I currently live in. Sure, taxes, insurance, and maintenance will always be ongoing cost, but for the most part my housing costs are fixed way below what rent would be now.
I also do not know what's wrong with professionals doing things like cutting the grass and trimming hedges. Every hour of my day does not need to be spent in some highly productive fashion. An hour/week in the summer, outside doing the yard while listening to music is a great way to relax and unwind.
>It doesn't make sense for highly paid professionals to spend enormous amounts of time or money reshingling roofs, painting, mowing lawns, treating weeds, trimming hedges, repairing plumbing
So we pay HOA fees for high-rise condos.
Rents in SF grew $2000 over 5 years. I would be ecstatic if my worst-case housing market outcome were a measly $250/mo. My standard of living is going to fall every year at lease renewal time until I can't take it anymore, and then I'll go live out my days in a soul-crushing Midwestern cost center IT department, if any haven't been outsourced or automated by then.
Housing costs that can't increase are looking really good right about now.
Oh, we've got problems of that sort in Atlanta, too (at a different price scale than SF, of course). There's an enormous spread between mortgages and rent at the moment; so many fewer people qualify for mortgages after the housing crash due to tougher underwriting standards and a return to traditional down-payment requirements that many, many more people are forced to rent. That has pushed rents way up. But for those who qualify, buying has never been cheaper. Needless to say, they pocket the difference, and it's an extreme landlord's market. They've got their pick of tenants and getting a place inside the Perimeter with anything less than impeccable credit is hard.
Median rent in Midtown Atlanta, where I last lived, is pushing north of $2000, which for Atlanta is a _princely_ sum considering it's ... well, it's Atlanta. It's not Brooklyn or Chicago. If I'm going to pay that much, I want Brooklyn or Chicago.
That's true. Condos do provide a compromise that I find relatively acceptable, though I'm still not sold on overstating the security premium, particularly given the greater financial volatility of condos.
Since the value appreciates in land, condos do not tend to gain value over time. At best a condo will have the same value because of exhaustive maintenance.
That's not true at all. Condo prices rise just like single family homes. And when you own a condo, you own a fraction of the land it sits on.
I would agree that condos tend to be more volatile than single family homes. More of them can be built quickly and when real estate prices start to drop it often starts with the condos.
Seems to be regional. I'm sure condos in places like DC appreciate, but in my region, condos absolutely seem to depreciate on average. It's exceedingly rare for me to find a condo on Zillow asking more than it was sold for 5+ years ago.
I own a condo that I rent and live renting in other part of my city. The rents cancel each other. It works very nice for me.
I definitely wish more people own their homes. I also love highrises.