The State of the Nation's Housing

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Joe Raedle / Getty

A home in Miami is up for sale

The State of the Nation's Housing 2009
By the Joint Center for Housing Studies of Harvard University
44 pages

The Gist:

Since 1988, Harvard's Joint Center for Housing Studies has published an annual report assessing the state of housing in the U.S. This year's analysis culls information from several sources, including the Census Bureau, the Department of Housing and Urban Development, the Bureau of Labor Statistics and the Bureau of Economic Analysis. The report strives to be a resource for policymakers and private citizens looking to buy, sell or rent. It reviews affordability concerns, explains how housing continues to affect the economy and cites factors that could drive growth in the future.

Highlight Reel:

On the danger of using home equity to pay off nonhome debt: "A recent Federal Reserve report estimates that of the trillions of dollars in real home equity cashed out between 2001 and 2007, homeowners used $874 billion to pay off non-mortgage debt — in effect rolling consumer debt into their home loans. Unlike consumer debt, mortgage debt cannot be discharged through personal bankruptcy."

On the generation that could help: "[T]he echo-boom generation is replacing the far smaller baby-bust generation in the young-adult age group. Indeed, the echo boomers are entering their peak household formation years of 25-44 with more than 5 million more members than the baby boomers had in the 1970s. The echo boomers will help keep demand strong for the next 10 years and beyond, bolstering the markets for rentals and starter homes."

On how housing challenges affect the overall economy: "[H]ome equity fell by $2.5 trillion in real terms in 2008 and nearly $5.9 trillion (or 43 percent) from the 2005 level. The loss of housing wealth caused consumers to curtail cash-out refinances and pull back on spending, knocking an additional 0.9 percentage point off economic growth last year, according to Moody's"

On why incomes are looking paltry: "Real median household incomes in all age groups under 55 have not increased since 2000. In fact, for the first time in at least 40 years, there is a chance that the real median household income for these age groups will be lower at the end of the decade than at the start."

The Lowdown:

If the numbers and news about home prices, unemployment, foreclosures and the subprime-mortgage crisis have blurred your vision and made your ears bleed throughout the past year, this report will help boil it all down to what's essential — and it'll also throw in some graphic elements, if you're more of a visual learner. But don't expect any groundbreaking information. Since the center is research-based, much of what it has published in The State of the Nation's Housing has been reported or analyzed before. The report does, however, offer some interesting insights into how the "echo-boomer" generation could play a vital role in boosting the housing market. But like many economy- and housing-related projections, these figures are just forecasts. If anyone really knew when the housing market would bottom out or reach its peak, there would be no reason to speculate.

The Verdict: Skim