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"A 20% down payment on a median US home now exceeds the median household's entire annual income. Before tax.
US home prices have quadrupled since 1985, while real wages have barely moved. In San Jose, houses cost twelve times local income. In LA, eleven. At those ratios, local wages have basically nothing to do with local prices. The question is whether this corrects, or whether home ownership is being quietly phased out for anyone who doesn't already have capital."
~ Coin Bureau
The global housing market has reached a state where home prices are completely untethered from median wages, transitioning from an income-constrained market to one that is strictly wealth-constrained. This crisis is fuelled by a supply freeze caused by the lock-in effect of low interest rates, the rise of institutional and small-scale investors who prioritize build-to-rent models, and chronic undersupply linked to restrictive zoning laws. Proposed fixes like 50-year mortgages or bans on hedge funds often function as traps that increase borrowing power without lowering prices, while the anticipated great wealth transfer from older generations is likely to be eroded by high end-of-life care costs and government clawbacks. Consequently, younger generations are increasingly caught in a near-zero wealth trap, leading many to abandon traditional saving in favour of liquid assets like Bitcoin or gold as they face a future defined by a subscription-based economy for shelter and a permanent disappearance of the middle-class path to ownership.
0:00 Intro
1:01 Background
3:45 The Lock-in Effect
6:24 Institutional Participants
8:39 Policy Theatre
10:30 The Global Comparison
12:22 Great Wealth Transfer, to the Rescue?
16:58 Full Steam Ahead
Source - Coin Bureau Finance: https://www.youtube.com/watch?v=B2tJZ9wTxKw
Disclaimer: This video is provided for informational purposes only, and not offered or intended to be used as legal, tax, investment, financial, or any other advice.
