How to Save the Dying American Dream of Homeownership

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A brief moment in recent history gave some hope to the housing market: by early 2020, home ownership rates had peaked since the 2008 housing market collapse. .

Then things took a drastic turn. Housing shortages across the country are now driving up prices, with no signs of falling again any time soon. The “American dream” of home ownership has long been unattainable for many, but is now moving further. What can we do? What it should we do?

It’s hard to be sure, and I don’t claim to have all the answers, but I’d like to share some of the lessons I’ve learned in my personal and professional journey. I hope that with these and other learnings, we can help fix what is broken in the real estate industry.

Related: The real estate game is changing rapidly. Are you ready to win?

Get out of bad situations

The market shortage will be corrected over time as more homes are built to meet growing demand. However, affordability will continue to be the biggest and most difficult issue to solve in the housing market, and it is something I am all too familiar with as the main cause of the abandonment of the home buying process. It can be daunting to see prices go up year after year, thinking that they will eventually go up so high that you will never be able to afford your home, but there is a way to get over it.

After my parents divorced when I was little, my mother had to ask my cousin to sign us together so we could move into our next home. At the time, this was our path to follow, and the promise of blockchain technology that allows home ownership to be split between several parties is likely to become a valid path in the near future, but we are not there yet.

For now, the biggest impact we can have on uncontrolled prices is the reduction in rates associated with buying a home. In my mother’s case, even with a co-signer, we still couldn’t afford the luxury living in the house and paying the mortgage, so we rented the house while my mom, two sisters and I lived in the garage without plumbing or air conditioning for most of two years. Those were not easy days; it was a time of survival, and it is something that no family should have to endure.

Related: Blockchain technology is revolutionizing real estate. Are you ready to charge?

Go your own way

The traditional real estate transaction includes commissions for a 6% commission, 3% for each agent. Maybe that made sense once, when real estate used to be a lot more work. However, technology has improved the process so much that this outdated model often does not benefit the consumer. The average American needs help; they need someone to turn their backs on them.

Reducing or eliminating excessive fees is the first and perhaps the most vital step in democratizing home ownership. Along with these rates comes what I think is an unnecessary complexity that permeates the entire process of buying and selling a home. I long for the day when the home buying experience has become so efficient and streamlined that buying a home is no more complicated than buying a car (although this process could also be a little less stressful). Solving the problems of excessive tariffs and unnecessary complexity is the main concern of those working to correct the shortcomings of the sector.

While I would never recommend home ownership as a major investment vehicle, getting into the market now may still make sense. Maybe it shouldn’t be like that, but landlords have an average net worth 40 times higher than tenants. However, owning a home is more than just buying an asset that will build up value. It’s about finding and having a place to live your life and create memories.

Related: Real Estate Tips to Help Millennials Buy Their First Homes

Disorder, innovate, improve

It is not enough to “move fast and break things”. Innovation must benefit the consumer. Edison brought the light bulb to the consumer market. Ford made affordable cars. Both made a lot of money as entrepreneurs, but they also improved the lives of the average consumer.

When the Internet began to bring technology to the real estate market, sites and services were launched that many hoped would disrupt the industry by simplifying the process and making it easier for sellers to relate to buyers, and they did so for a while. However, in today’s competitive market, iBuyers have emerged that are able to outperform and outperform traditional homeowners by leveraging their liquidity to make cash offers that regular shoppers cannot compete with. Giving average buyers the opportunity to make competitive offers in cash is one of the best tools the industry has to restore a sense of fairness in the marketplace, and it is something I wholeheartedly support.

For the past two years, we’ve been through the most uncertain market this country has ever seen. Demand for housing reached all-time highs, while housing supply reached all-time lows. As a result, housing has become so expensive that the property seems out of reach of those who want and need it most. People do not want to sell because they are afraid to buy in this market. To put it bluntly, people feel trapped. This causes many, including myself, to ask, “Where are we going from here?”

I may not have all the answers to this question, but I have hope for the future. We can take advantage of what we have learned about getting out of bad situations, doing things differently, and altering the status quo to move forward. We can still help make our dreams come true. You just have to be more discriminating with the help you render toward other people.

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