I’ve been ranting for weeks now about it… People don’t understand that sky-high home prices are bad for countries, cities, businesses, and consumers.

And only the 62% of people who already own homes are feeling the “bliss” of the bubble. They’re the ones who want prices to keep going up so they get something for next to nothing…

There’s another side effect of this housing bubble. We’ve seen it in the bubbliest areas for years…

Birth rates fall when bubbles make it even more unaffordable to raise a child.

Long-term data is crystal clear on this. People who move from rural to urban areas, and become more affluent as a result, have fewer kids. They strive to educate and raise them better as a result.

In rural areas, housing costs are much lower and the kids often help on the farms – even after elementary school, historically speaking.

But in urban areas, the cost of living is much higher – along with real estate prices – making it costlier to raise kids in the city. That cost then increases as they get older, especially if they decide to go to college.

But there’s more recent evidence to support this as the second housing bubble rears its head…

Births have fallen substantially with home prices rising again in recent years.

The five lines in this chart represent the five quintiles of degrees of housing appreciation. The darker the line, the higher the housing appreciation.

The highest quintile, or top 20% for home appreciation, have seen a whopping 13% decline in birth rates between 2010 and 2016. The next highest quintile has seen an 8% decline. The lowest three quintiles have seen between 5% and 6.5% declines.

It’s perfectly clear: Rising home prices correlate with falling birth rates, and the higher, the greater!

That’s just what we need with already falling birth rates and long-term demographic stagnation/decline in the developed countries: A housing bubble that makes that trend even worse.

The sooner this housing bubble crashes, the better…

Despite how difficult it will be for the banks, businesses, and households that own real estate, it’ll be a Godsend for the younger families that are our future. It’ll help lower costs for businesses as well.

All you can do is get out of the way of this inevitable – and ultimately healthy – reset in home prices, which is likely to hit us in 2019, or as late as 2025.

Harry
Follow Me on Twitter @harrydentjr

New Update on the Markets!

Harry Dent shares details on his latest prediction for the markets and the new dangers that lie just ahead for Americans:   “This is no longer a question of ‘if,’ but simply a… Read More>>
Harry Dent
Harry S. Dent Jr. studied economics in college in the ’70s, but found it vague and inconclusive. He became so disillusioned by the state of his chosen profession that he turned his back on it. Instead, he threw himself into the burgeoning new science of finance where identifying and studying demographic, technological, consumer and many, many other trends empowered him to forecast economic changes. Since then, he’s spoken to executives, financial advisors and investors around the world. He’s appeared on “Good Morning America,” PBS, CNBC and CNN/Fox News. He’s been featured in Barron’s, Investor’s Business Daily, Entrepreneur, Fortune, Success, U.S. News and World Report, Business Week, The Wall Street Journal, American Demographics and Omni. He is a regular guest on Fox Business’s “America’s Nightly Scorecard.” In his latest book, Zero Hour: Turn the Greatest Political and Financial Upheaval in Modern History to Your Advantage, Harry Dent reveals why the greatest social, economic, and political upheaval since the American Revolution is on our doorstep. Discover how its combined effects could cause stocks to crash as much as 80% beginning just weeks from now…crippling your wealth now and for the rest of your life. Harry arms you with the tools you need to financially prepare and survive as the world we know is turned upside down! Today, he uses the research he developed from years of hands-on business experience to offer readers a positive, easy-to-understand view of the economic future by heading up Dent Research, in his flagship newsletter, Boom & Bust.