Trump’s Homeownership Rate Graph on TV Is Misleading
Donald Trump spoke today at the National Association of Home Builders meeting, and showed them a graph of US Homeownership Rate. He had this made up especially for their meeting. Actually, it is available to anybody just by googling US Homeownership Rate. The Home Builders actually have probably seen this a thousand times in their careers. It was meant for the public. But flashing it around, viewers could not see what I expected, that it had a suppressed zero on the vertical axis. That is, the left vertical axis actually started at 62%, and the peak was at about 69%. The recent peak was around 2004. The drop when President Obama took office was already down to 67.5%, and it is now down below 64%.
Here is one of such graphs below.
Since Trump did not mention the suppressed zero, a viewer would conclude that the rate under President George W. Bush had risen to 3.5 times the rate in the eighties. In actuality, it was only 5% higher in home ownership. I couldn’t find on the web a version of this graph that actually starts at zero. Since the range of the axis shown is 8%, starting at 62%, to find the true zero, you would have to extend the axis down about 8 times its height.
We have to remember that when President Obama took office, there were many homes sold on so called “liars loans” to people who were encouraged to lie on their mortgage applications to obtain loans. The packaging and resale of these junk loans led to the economic collapse and the recession of 2009.
The years around 2005 were a housing bubble when it seemed that the prices were rising, so a number of people bought houses to flip them. This shouldn’t be called real home ownership.
