"Our House" is a song written by British singer-songwriter Graham Nash and recorded by Crosby, Stills, Nash & Young on their album Déjà Vu in 1970. The single reached No. 30 on the U.S. Billboard Hot 100. The song, "an ode to countercultural domestic bliss", was written while Nash was living with Joni Mitchell and her two cats at her house in the Laurel Canyon area of Los Angeles.
The official video for this song is included in the YouTube link below.
In a 2013 interview, Graham Nash explained the morning and his inspiration for the song as follows:
“Well, it's an ordinary moment. What happened is that Joni [Mitchell] and I had been on Ventura Boulevard in the Valley, there's a very famous deli called Art's Deli. And we'd been to breakfast there. We're going to get into Joan's car, and we pass an antique store. And we were looking in the window, and she saw a very beautiful vase that she wanted to buy ... I persuaded her to buy this vase. It wasn't very expensive, and we took it home. It was a very grey, kind of sleety, drizzly L.A. morning. And we got to the house in Laurel Canyon, and I said – got through the front door and I said, you know what? I'll light a fire. Why don't you put some flowers in that vase that you just bought? Well, she was in the garden getting flowers. That meant she was not at her piano, but I was ... And an hour later 'Our House' was born, out of an incredibly ordinary moment that many, many people have experienced.”
Many of us can relate to similar life and family moments that we have experienced in our homes. These create memories that cause us to have emotional attachments to our homes. This also makes it harder for people to sell and leave their homes, and the memories created there.
While the tug of happy and emotional moments keeps many people tethered to their homes, there are also current financial issues causing people to stay in their homes longer than many expected. The first is sharply rising mortgage rates. Over the last 18 months, we have seen interest rates on 30-year mortgages go from below 3% to over 7% today. There are not that many people who are anxious to sell their existing home with a low-interest rate mortgage and move to a higher priced home with a much higher interest rate mortgage to boot.
However, higher interest rates only hurt new home purchasers. As you can see in our chart below from the Bureau of Economic Analysis, the average interest rate on outstanding mortgage debt across the country is still well below 4%.
This is helping keep existing home inventories at some of the lowest levels we have seen in more than 40 years. This also means that every home that does come on the market has more potential buyers than there would typically be. This is keeping home prices elevated at a time when many people thought prices would fall, similar to what they did in the 2007-2008 subprime mortgage crisis.
A second surprising data point is the number of homes that people own that are paid off with no mortgage. As you can see in our second chart, there are over 32 million homes, or more than 38% of all homes owned, that have no mortgages. If your house is paid off, or you can sell your house and pay cash for another one, current interest rates have no bearing on your decision.
The Federal Reserve Bank was hoping to take the froth out of the housing market and home prices by raising interest rates and therefore mortgage rates. This is only having an impact on people who want to buy a home now, and need to finance that purchase through a mortgage. Unfortunately, this means many of our younger families are being disproportionately hurt the most.
“Our House”, and probably your house, have great meaning to us. We would like our children and their families to experience similar moments in “their house’. If you have a child or young person in your life, that is struggling with decisions around when, and how to buy a home, and the best way to manage their finances around higher home prices and higher mortgage rates, please let us know. We would be more than happy to help guide them through the situation. We are here for you, and for those you love.
© 2023 Jesse Hurst
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