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It\u2019s no secret that America is an increasingly polarized<\/a> nation. It stands to follow that our places of residence would also be divided. But instead of a donkey and an elephant, the new emblems of each party might as well be an unowned apartment in a big city and a home in the suburbs. Just consider what Aziz Sunderji has stumbled onto.<\/p>\n For nearly three years, Sunderji has been writing Home Economics, a Substack<\/a> that has morphed from a graphic meditation on personal finance issues<\/a> to a specific housing focus. With almost 14 years as a Barclays<\/a> analyst under his belt, along with a stint as a graphics reporter at the Wall Street Journal<\/em>, Sunderji dives deep into data, and has become increasingly housing-oriented. For instance, he was published in the Financial Times<\/em><\/a> in January 2023 with a stark warning: \u201cSpare a thought for the American first-time homebuyer, for whom things have rarely looked so grim.\u201d But grimness has shades.<\/p>\n As Sunderji recently explained in a post called \u201cThe politics of housing: owner\/renter polarization<\/a>,\u201d he\u2019s surprised by what he\u2019s found after intensive analysis. \u201cI had not imagined how much of a stark divide there is between renters and owners,\u201d he told Fortune <\/em>in an interview.\u00a0<\/p>\n Sunderji\u2019s analysis dove into data from the American National Election Studies<\/a> (which surveys thousands of households) and found homeowners are twice as likely to identify themselves as strongly Republican than renters\u2014and renters far more often identify themselves as strongly Democrat. And the gap between homeowners who identify as strongly Republican compared to renters amounts to roughly 14%, his recent analysis<\/a> showed. In the dataset, there was a seven-point scale in which voters were asked to gauge their political affiliation, and \u201cthe most common response from renters is that they are strong Democrats and from homeowners, that they\u2019re strong Republicans,\u201d he told Fortune<\/em>.\u00a0<\/p>\n It\u2019s a huge divide, and one that\u2019s much bigger than separate topics among other demographics. In the analysis, Sunderji gave the example of education: there is only a 6% gap between non-college education and college-educated people who say they\u2019re strongly Republican, and the gap between men and women who identify as strongly Republican is smaller.\u00a0<\/p>\n After he published his analysis, he told Fortune<\/em>, there were questions about whether this phenomenon is simply an age or an income thing. But it doesn\u2019t seem like it is. \u201cAcross the age spectrum, at every point, owners are substantially further to the right than renters,\u201d Sunderji said. And when you break it down by income group, from the poorest to the richest, renters are still further to the left than owners. In all but seven states, homeowners are much more likely to be affiliated with the Republican party, Sunderji explained, so it\u2019s not just a coastal thing, either.\u00a0<\/p>\n The thing is, Sunderji\u2019s analysis agrees with a wealth of anecdotal evidence. Consider the housing Catch-22.<\/p>\n The left\/right split has been much discussed since the electoral victory of Donald Trump in 2016 exposed a gaping urban\/rural divide. In 2004, then-state senator Barack Obama awed the Democratic National Convention with a powerful, star-making speech<\/a> denouncing how \u201cThe pundits like to slice-and-dice our country into Red States and Blue States.\u201d But this analysis, along with the development of the American economy, suggest that there really are red and blue housing situations.<\/p>\n In the economy of the 2020s, the highest-paying jobs are where the affordable houses aren\u2019t\u2014and vice versa. Fortune<\/em>, toward the end of last year, dubbed this a housing Catch-22,<\/a> citing research by labor economists Jesse Rothstein, David Card, and Moises Yi, published by the National Bureau of Economic Research. Their research shows that wage differences affect home purchasing power and suggests that moving to higher-income areas can effectively be a wash because subsequent housing prices are so high. This aligns with the partisan identities of Democrats as a coalition that merges most college-educated<\/a> Americans with minority and female voters, and Republicans centered away<\/a> from metropolitan centers, where housing costs are cheaper.<\/p>\n Democrats also bank on the (famously fickle<\/a>) youth vote, too, and that plays a part here. While many Gen Zers<\/a> are currently in a life stage where big metros appeal more, they are finding that the rent is just too darn high. The generation reports that they are struggling to make ends meet<\/a> and build enough wealth to even enter the thorny housing market, while living with more roommates<\/a> because even renting has gotten too costly. Meanwhile, some millennials have finally aged into being able to purchase a home but are finding themselves drawn out of the cities and into the suburbs<\/a> in search of less expensive deals. Still, Redfin has reported<\/a> that while it\u2019s incredibly early to make such a judgment, Gen Z appears to be getting into the homeownership game at greater numbers than millennials and Gen Xers did.<\/p>\n \u201cIn an environment where housing costs are soaring, and where the burden is particularly on renters, it\u2019s not totally surprising that there is some polarization,\u201d Sunderji says, and he actually pinpoints the politicization of housing to somewhere exactly around Obama\u2019s famous keynote speech at the DNC. (Sunderji did not comment specifically on the Obama speech or presidency in his interview with Fortune<\/em>, to be clear.)<\/p>\n Sunderji\u2019s data goes back to the late 1960s, and in that period, homeowners and renters\u2019 political preference was pretty similar. \u201cThey look similar for about a decade or so, but what\u2019s happening is gradually owners start shifting to the right over the \u201870s, \u201880s, and \u201890s; and then what happens in the last 20 years or so, is that renters suddenly swing sharply to the left,\u201d Sunderji said.\u00a0<\/p>\n He acknowledges that \u201cit\u2019s really a sharp polarization, but it\u2019s kind of a culmination of stuff that\u2019s been going on for a while.\u201d\u00a0<\/p>\n As to why this is happening, Sunderji doesn\u2019t have a definitive answer yet, but he does have a theory. In America, people are sorting themselves into groups, he says, and similar values are almost being stitched together. So naturally, there are divisions between groups. Young, college-educated people who tend to be more liberal, he proposed, are inhabiting and populating cities, which can be severely unaffordable from a homeownership perspective\u2014so they rent and tend to be renters.\u00a0<\/p>\n America is already so polarized politically and culturally. And in an election year, with two presidential candidates who tend to further exacerbate an existing divide, a haves and have-nots housing market doesn\u2019t help. Maybe this gap between homeowners and renters was bound to happen.\u00a0<\/p>\n \u201cThe two groups are going in different directions really starkly, recently, and it\u2019s accelerated,\u201d Sunderji said, referring to homeowners and renters. \u201cThis is just the tip of the iceberg.\u201d\u00a0<\/p>\n<\/div>\n\nThe Catch-22 for Americans: Cheap housing or good jobs<\/strong><\/h2>\n
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