Journalists seem to have a biological craving for end-of-the-world, no-way-out stories. This story was simply unstoppable because it also included Baby Boomer bashing. Journalists feel smug and fuzzy just thinking about it.
However, this Boston-real-estate-is-doomed article does have one unfortunate side effect. It assumes that real estate in areas like Arizona will do very well. I guess the writer assumed that no one in Arizona would read the article so he wouldn’t get kicked out of the club.
And I love this bit.
The boomers’ and busters’ influence on the housing market has never been easy to predict. In 1989, economists Greg Mankiw and David Weil, then both at Harvard University, took a stab at it. As the baby busters were entering the market, they wrote in a widely read paper that ” housing demand will grow more slowly in the 1990s than in any time in the past 40 years . . . [and] housing prices will fall substantially over the next two decades.” Wellesley College economist Karl Case jokingly calls this ” one of the worst forecasts in the history of mankind.” Anyone who’s read a newspaper in the past 20 years knows he’s only slightly exaggerating. The median price for a house in Boston dropped last year to $515,500, but compare that with 1990, when the median price was $159,000.
You just gotta take economists – and journalists – with a grain of salt and make your own decisions.