Why 2022 Is a Historically Terrible Time to Buy a House

Homebuyers beware: the real estate market in 2022 is challenging many of the benefits of owning a house. Even though rents are increasing around the U.S., they aren’t rising nearly as fast as the cost of buying a home.

Economists have long said that renting and investing in the stock market is a better investment than owning a house, and in 2022 that could be especially true. I’ll explain why.

0:00 Here’s why Americans should be renting over buying a house in 2022
0:18 Right now is a historically bad time to buy a home
1:09 Renting and investing in the stock market
2:03 Home prices are also starting to come down in many parts of the U.S.
2:38 Don’t forget about inflation

I’m Dion Rabouin, a WSJ reporter covering markets and the economy. I’ll be diving into all things finance, from the popular and well-known — like crypto and stocks — to the complex and intricate — like leveraged loans, derivatives and private equity. Subscribe to join me as I take a deep dive into what’s making money move and why it matters.

#Homebuying #RealEstate #DionRabouin

[DionRabouinWSJ]

Is it a better investment to rent and put savings to work in the stock market or buy a home?

[TheAdventuresofDrewandAmanda]

My rent went up from $1000 to $1400 in January. My pay however stayed the same. 🤷‍♀️

[paillette]

Private equity is training the American consumer to do with housing what Apple did with music: not own it yourself. Until it stops outcompeting the average consumer, we are screwed.

[KRN]

Got my house in Feb before rates skyrocketed

[KG-yuel]

I'd be interested to see the Wall Street Journal cover the Canadian Housing Market; there's some interesting differences between us and the neighbours to the south.
Good stuff.

[ADHD]

Many landlords own multiple properties holding mortgages, if rates go up guess what the rent will too In order to cover the difference

[drbakker]

Thanks, nice video. Just saws this on wsj. However, what do you think about the mortgage interest deduction? It seems that that is a significant offset in the real costs of owning...

[gregorynuttall]

"Is it a better investment to...". Come on Dion. Most Americans can't afford to use that language in their lives. They're too busy asking, "Can I afford to...".

[bomchikawawa]

I feel like the arguments made in this video are very weak. Mortgage payments could be going up 46% in a year - but that’s not a good metric to go by in my opinion. Interest rises from 1 to 2% is a 100% increase but overall is insignificant compared to historic interest rates.

The gap between median rents and median mortgages is also not a fair comparison as a repayment mortgage buys back some ownership of the property every month - a value which likely exceeds the gap.

A better argument would have been the risk of a correction/crash and the potential for negative equity for people who are over leveraged.

You also haven’t suggested what people should do with the money they’d keep renting or expected returns. If you’re just suggesting they save it I would argue that is the worst thing they could do in such a high inflation environment. In the long term they’ll likely pay more in inflation tax than they’d suffer through a housing market correction. Bonds might be an option but unless they’re index linked again you won’t beat 20 year average house appreciation. The stock market is also not likely to present greater returns in the short - mid term either…

[haoxus]

Rent plus stock would make sense, if stock market is going up

[vertugodream]

Прикольно, что с февраля такая песня у вас началась. Так итог какой? Покупка или аренда?

[Shaq]

Lmao busted out the Busta Rhymes! Idk how you keep finding the perfect rap quote for each video but keep at it

[bigwill]

Actually my total monthly cost for my house is lower the than the median yeah.

[animal]

Did not expect Busta rhymes to be quoted on a wsj video, refreshing