Sinai [Wharton Professor Todd Sinai in a new policy brief] argues that for those who can afford it, buying a home may offer a way to sidestep this cycle of ever-rising housing prices and rents. “Because homeowners lock in their house price at the time of purchase,” he writes, ”when rents rise, a homeowner’s annual housing cost is unchanged.” But as the last housing crisis showed us, our current system encourages a deadly combination of irrational expectations, outright speculation, and unscrupulous lending practices that can do serious damage to the broader economy. Buyers, beware.

Ultimately, Sinai frames America’s worsening housing affordability crisis in unusually blunt and candid terms. “Already it is no longer the case that someone can automatically afford to live in the city in which she grew up,” he writes. “A debate needs to take place about the value our society should place on whether a household should have an unlimited right to choose where to live, and how much they should be insulated—if, at all—from the differences in cost.” The brutal reality may well be that more and more people will be unable to live in superstar cities, as they are sorted and shunted off into less desirable and less costly locations.

Source: America’s Housing Affordability Crisis Isn’t Actually New – CityLab