Following up on the post immediately below, experts are beginning to analyze the economic impact of a current housing phenomenon: “squatters’ rent.”
It seems that some of the “rising income” of Americans is tied to underwater homeowners simply refusing to pay their monthly home mortgages, freeing up money for other purposes and purchases. In the crazy world of economic data measurements, the government is apparently counting these “savings” as “income.”
In an odd way, this is good in the short-term, because some homeowners get to spend more money to boost other sectors of the economy. But it’s also obviously a rob-Peter-to-pay-Paul scheme that cancels out any benefits in the long-term.
Not to harp on the issue, but the ultimate top solution to the housing crisis, as well for the nation’s overall economic health, can be summed up in one word: jobs.
File under: Squatters Economics