Housing; A Servant with Two Masters
Joan owns three houses and is looking for a fourth. She bought her first house when she was twenty-five after working in her comfortable and mildly intellectually satiating corporate job. She flipped that house three years later, then bought another which she renovated while renting a place then sold it. She has since bought two other investment properties. Her third house, the final of the three that she owns is her current family home. The housing market has been good to Joan, her returns have been handsome and the risk tolerable. It only makes sense for Joan to add another property to her portfolio; the market has always been her friend.
Joan hopes the housing market continues to rise.
Greg has been saving for years. Now, he hopes, is his time to enter the housing market, to get his foot on the housing ladder, to build wealth, and to have a permanent place to live. Greg’s lease is running out, he loves his current place as do his wife and the kids. It’s affordable for the area, close to schools, and has a wonderful park that he a Lisa love strolling around after a busy day at the factory. His landlord is demanding that Greg either lock in another twelve-month contract or vacate the premises. If Greg leaves, only through divine intervention could he find another place like his current place in the area. His investment portfolio is like a rainwater tank in a desert, empty. The housing market has been good to those who are in it. House prices have kept on increasing at various magnitudes but always in the same direction; up. He should get in, he needs to get in.
Greg hopes the housing market cools down slightly to allow him to buy, and then, after his purchases, he hopes it accelerates once more and rises to heights not previously seen.
Rudolph has lived on three different couches in the last two months, he spent the month before that homeless. He was evicted from his house as he was not able to pay rent. Housing prices have been rising, landlords are taking on large mortgages with high-interest rates to purchase houses. The interest rates on existing mortgages are also rising. The high-interest rates are leading to rent increases; at least that is what he has read in an article or two. If Rudolph renting a house is a dream then owning a home would be a miracle.
Rudolph hopes the housing market declines but he would be content if it merely cooled down.
If corporations are people then markets can have a voice. I am the housing market. I normally use my John Cena hand and the market equilibrium to express myself but I thought I should break character on this occasion; painters are allowed to give interviews. I cannot please everyone.
If I rise, Joan is happy, Greg is likely indifferent as in the short term entering the housing market will be difficult however in the long term he will benefit if I continue to rise and Rudolph is screwed.
If I fall, Joan will be miserable and now have to depend on her mildly intellectually stimulating job to make money, Greg will be pleased initially however if I keep on falling he will join Joan in the misery camp. Rudolph will be pleased as his rent won’t continue to rise and if I fall far enough, a miracle may occur and he might get his foot in the door or on the ladder or whatever cliché you prefer to illustrate one becoming a participant in the market.
If I were to remain stagnant, everyone would be unhappy. Joan because her returns are no longer as attractive, Greg because in the short term, houses are still unaffordable and in the long term he won’t make a profit and Rudolph because he can afford rent or a house in the market's current state
I am a slave, my master is necessity, and my master is investment. Who I should serve conflicts with who I do serve. In a just world, I should serve Rudolph but in reality, Joan is who I serve and Greg is an afterthought. Maybe I should stick to televisions and movie tickets; simple things.