Birthrates are a powerful, but lagging/post-hoc indicator of public policy effects. It's worth noting that we tend to associate high birthrates with poverty and negative social outcomes. Except, when rates are low we (western countries) use immigration from high-birthrate societies to shore up the population replacement rate, as the article notes. When you look at who is having kids in the US and Canada, the families…
As a new father, I share this perspective. To get an anecdotal sense of our financial struggle, we have 2-4x the net worth that my parents when they were our age, but cannot afford the same house that I grew up in and doubt we ever will.
i.e., suppose every consumption good becomes 10x as cheap overnight. Cars, food, phones, clothes, travel by air, electricity, movies, music.
What would happen to home prices? Well, it's likely they'd skyrocket. All the additional disposable income has to flow somewhere, to some asset, and that's often real estate.
There's some indication that that's been happening. Of course there's many other stories in real estate which clearly indicates we're less well off than before, particularly certain groups.
But there's also many indications we're better off, but simply spending more of our money on RE, because in part, we can, because in part, we want to.
For example, compare the average home size (square footage) in 1950 to 2020 and anywhere inbetween, it's a pretty straight line that ends up a 2.5x increase.
Then compare the average persons per home, it decreased from about 3.4 to 2.5, in large part to the large number of single-person household, a luxury not affordable in the 1950s, especially not to women in a much more patriarchal society than today.
This means we've seen a tremendous increase in the square foot per person. That's a measure of wealth. The fact home prices skyrocketed due to the demand for these luxuries, and the (by definition) ability for Americans to afford to push prices to these levels, should not necessarily be seen as an affordability crisis, but rather as an indication of wealth.
Yes, if prices of bread skyrocketed and we were all consuming less because of it, that's poverty. But if the average bread consumption per household grew by 2.5x, and the average number of people eating that bread in the household dropped by 25%, then you can't quite say that on average we're less well-off, bread-wise.
And homes aren't the same as in the 1950s either. Today's homes are well-equipped with many luxuries and comforts. Finally, high prices are a bit misleading without taking interest rates into account. In the 1980s for example interest rates were 15%, you'd pay your home in full every 6 years in interest alone. Just look at the historical trend of interest rates, they're at record lows. For example, a 30 year mortgage of 100k at the 1980's 15% interest rate, costs as much in total payments, as a 30 year mortgage of 300k at today's 3% interest rate. A 3x price increase alone has absolutely no effect on affordability in the past 40 years due to the massive drop in interest rates. If you take into account the fact that nominal income grew by 5x since the 1980s as well, plus the larger square footage and the fewer people per home, it's easy to see why the cost of a square foot has actually become way more affordable. And given many things got so much cheaper, it's easy to see why so much wealth has flowed to RE.
Definitely don't want to pretend like there's no housing affordability issues anywhere, but I do want to nuance the view a bit that we're generally worse off than previous generations, in which housing is an oft mentioned example. But on balance, it's not really the clearest example for this generational loss of quality of life that people tend to think it is.