Next Stop Pottersville
Prof. Krugman makes one of my less-favorite arguments here, while otherwise appropriately noting how expansion of homeownership under Bush is yet another observation supporting the Davies Conjecture:
Owning a home also ties workers down. Even in the best of times, the costs and hassle of selling one home and buying another — one estimate put the average cost of a house move at more than $60,000 — tend to make workers reluctant to go where the jobs are.
Do we liberals really want to be making the case that society would be better off on net if more of the citizenry were effectively rootless migrant workers?
This is an area where there’s at least some conflict between the macro- and micro-level evidence, and the more theoretically compelling micro evidence is less supportive of the view that there’s harmful causality from homeownership to labor market macro-features.
(It doesn’t help that the $60K figure for the “one estimate” of a typical move cost comes across as highly bogus. Commission on a ~$200K median house at 6% is around 12 grand. I’d guess typical search, moving [i.e. shipping], and closing costs would be of a similar magnitude. Other things equal, search and moving costs would be incurred in moves absent homeownership and aren’t appropriately included in a figure intended to express relocation costs specific to owning. Likewise, commissions and closing costs for homeownership should be expressed net of rental transactions costs.)