We should really re-think this unhealthy obsession with homeownership. I suspect that homeownership is actually economically sub-optimal for a majority of Americans, even the semi-wealthy. A more constructive question would be to ask: Why is it considered normal for families to expose themselves to so much systematic risk? We’ve all learned about the importance of diversifying our retirement portfolios, except while John Doe was busy diversifying the shit out of his stocks, he forgot about that single asset which accounts for 60% of his networth...and home ownership was supposed to be about stability? The American Dream is possibly the worst and most widely-accepted piece of financial advice.
Some interesting reads:
Equity Participation in Homeownership by Institutional Investors »
Long-ass academic paper on diversifying risk away from the home-value, explores the possibility of co-ownership with institutional investors.
The Subprime Primer »
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