This blog post is, indeed, a little esoteric. But many experts have predicted that another financial bubble is going to collapse, this one involving the HOA housing industry.
You really have to dive in between the lines of the story linked below. But this financial expert is predicting societal changes which actually could lead to a housing collapse in suburban America. He says the most dynamic part of our growing financial culture is the diversity of thought and creativity that’s only found in our inner cities and not in our stale suburban neighborhoods. He claims that our societal focus on suburban life is destined for failure and calls it “…the primary reason for global financial crisis.”
I’m no economist and my own predictions are far less sophisticated than his. But it boils down to the same conclusion: Sir Thomas More’s vision of Utopia is exactly backwards and is destined to collapse simply because the human spirit is not designed for life in Paradise. It’s evolutionarily designed for survival of the fittest. And the HOA Utopian model was never designed to handle the harsh realities of life.
When those institutions which underwrite home loans discover that the typical Homeowner Association model does not protect or stabilize property values, when they discover that homes outside HOAs actually rise faster in value than those inside gated neighborhoods, when they finally discover that embezzlement is the Achilles heel of covenant controlled developments, then investor money will start flowing out of homeowners associations and back into more traditional neighborhoods.