
A large majority wants to own a house, but only a small minority is actually saving money to meet that objective. The last line of defense for the housing bulls is the fallacy of pent-up demand. Belief in this fallacy relies on people’s inability to distinguish between desire and demand. The financial media frequently entreats us to stories about how home ownership is not dead because surveys proclaim 88% still desire to own a home. The desire for housing always exceeds the supply because there is always some segment of the market who is unable to obtain home ownership due to the cost of housing and a lack of available credit. True demand is the amount of money those with…[READ MORE]