Skip to content
Subscriber Only
Opinion
Noah Smith

Wall Street Puts the Squeeze on the Housing Market

Research suggests that concentrated corporate ownership can drive up prices in some cities.

Your new neighbor might be a corporation.

Your new neighbor might be a corporation.

Photographer: Matthew Staver/Bloomberg

President George W. Bush pledged to make the U.S. an “ownership society” and tried to promote homeownership via tax credits, assistance with down payments and a variety of other programs. In 2004, this probably looked like a good bet — the U.S. homeownership rate had risen to about 69 percent, from 64 percent in the mid-1990s. But Bush failed. Just a few years later, a deflating housing bubble followed by a financial crisis and recession sent homeownership into a nosedive:

During the crisis, President Barack Obama did too little to protect the ownership gains that Americans had enjoyed in the late 1990s and early 2000s. Hamstrung by a recalcitrant Congress and an internal distaste for bailing out citizens who made bad real estate decisions, Obama enacted only a modest program to reduce foreclosures. The result was that homeownership fell to levels not seen since the mid-1960s. Now it’s recovering, but if another recession hits, all bets are off.