Bubble Crisis or Savior? - Population Trends (real estate, mortgage)

[Min-Chi-Cbus]

The Twin Cities metropolitain area generally grows rather conservatively between roughly 10% and 15% every 10 years, driven by natural births/deaths ratio and net in-migration from other cities/countries, often by lower income families. Also, there is an offset to this increase by net out-migration usually in the form of middle/upper class native Minnesotans. (Source: US Census)

The housing bubble has caused chaos in the residential real estate sector, particularly with new home sales. As a result, fewer people can move because they are underwater on their mortgage and can't sell their home, or they can't get a loan and purchase a home because they recently defaulted on their previous mortgage or they can't afford a new home.

Since the primary factors that cause the metro area to grow are from natural births and in-migration by lower-income families who typically rent, and the primary factor that stymies growth is out-migration from families with higher means and often a mortgage, do you think that the Twin Cities area may actually BENEFIT from the Great Recession and the housing bubble in the form of higher population growth?

[southernsmoke]

The housing situation will benefit no one.

[Globe199]

"in-migration" = IMMIGRATION

"out-migration" = EMIGRATION

[audadvnc]

Originally Posted by southernsmoke

The housing situation will benefit no one.

Rather, the artificially inflated bubble benefited no one - except all those people who made mad money off it. Now that housing prices are sliding back to historical levels, all those folks who got spoiled by easy profits during the bubble are upset because their gravy train ran out, and they don't know how to make an honest living by doing something useful, like manufacturing goods.

[southernsmoke]

Originally Posted by audadvnc

Rather, the artificially inflated bubble benefited no one - except all those people who made mad money off it. Now that housing prices are sliding back to historical levels, all those folks who got spoiled by easy profits during the bubble are upset because their gravy train ran out, and they don't know how to make an honest living by doing something useful, like manufacturing goods.

Wow--that was loaded. That is not entirely accurate because the bubble, by definition, was "value" that was never actually there. So, yes, on an individual level, some people make out better than others, and it is conceivable (I guess) that a few might have actually been benefitted by the housing collapse... but your post makes an assumption/implication that just isn't true (i.e., "all those people who mad [sic] money off it"). "Those folks" on the "gravy train" lost a lot of home equity just like everybody else. I am going to stop there because while I could continue to analyze the situation, I am not even sure who you are talking about when you say "those folks," and to be honest, I'm not sure you know what you are talking about, either.

One more point, though... in order for people to have jobs "doing something useful, like manufacturing goods," there need to be some white-collar people organizing and running businesses that employ such people. (Technically it is not necessary to have businesses produce goods--i.e., you could have a one man shop--but this would be highly inefficient.) Additionally, I would recommend rethinking labor laws and the commitment to unions if you want to bring more manufacturing jobs to Minnesota.

[golfgal]

Rapid growth is not advantageous. The steady growth that MN has over time is one reason why we haven't been hit as hard with this recession.

[rcsteiner]

Originally Posted by golfgal

Rapid growth is not advantageous. The steady growth that MN has over time is one reason why we haven't been hit as hard with this recession.

The housing market in Minnesota has been hit rather hard, however.

[Min-Chi-Cbus]

Originally Posted by golfgal

Rapid growth is not advantageous. The steady growth that MN has over time is one reason why we haven't been hit as hard with this recession.

The question was merely asking whether it would impact growth because people who traditionally would EMMIGRATE can't do so as easily.

[southernsmoke]

Originally Posted by Min-Chi-Cbus

The question was merely asking whether it would impact growth because people who traditionally would EMMIGRATE can't do so as easily.

Maybe (assuming that it is true that immigration of home-owners does not drive population growth to an appreciable degree). But there are too many uncertainties to do anything other than speculate. How long is this situation going to go on? And how is it going to end? (Or is it?)

[Min-Chi-Cbus]

True. I'm not talking long-term....just the 5-10 years this may be going on. My thought is that it could very well impact those who leave the state, raising short-term growth rates (good or bad not important).