But that's not all.

FREAK OUT!



It's not just the marriages. It's also the money.



Marriage rates for the 25-44 set fell by 15 percentage points between 1980 and 2000. But this only accounts for half of the decline in Gervais and Fisher's model. The other half comes from stagnating wages, and the worry that the dynamic economy will destroy a couple's earnings with inflation, recession, or job loss. Basically: People aren't buying homes because they're freaked out about the economy.



The freak-out transcends gender and class, and it crystallized within a generation. In one survey comparing early Boomers (born in the late-'40s and '50s) and late Boomers (born in the late-50s and -60s), overall economic uncertainty in the second group rose by 11% for college graduates and 52% for high school graduates. Uncertainty about the value of college rose, too.

It's not all in their heads. Between 1950 and 1970, wage growth was something special. Earnings grew 44 percent per decade -- more than three times faster than they've grown over the last 30 years. If that trend had continued, the typical working guy would be earning a $194,000 per year today. (He's not.) Michael Greenstone, the director of the Hamilton Project, prepared for us this graph to illustrate the difference between where median earnings for men were headed, and where they've really gone. This is what the uncertainty gap looks like.



BROKE AND CROWDED



Houses are expensive. I'm not going to win an award for this observation, but there it is. The problem with expensive things, like houses, is that you can't buy them with only your own money. You need somebody else's money, too. This is why mortgages exist.

In the years before the Great Recession, mortgages bloomed thanks to financial innovation. This was creative destruction, in that order. First came creation. The subprime boom was, in Karl Smith's words, "a technological innovation that allowed millions of households to switch out of the market for multi-family homes [like duplexes] and mobile homes and into the single family market ... [pushing] up the price of existing single family homes." Then came destruction. This happened:

Before the Great Recession, we spread apart -- out of cities and into the suburbs and single-family homes. After the Great Recession, we came together. A quarter of young adults have moved back in with their parents for a significant period of time. More have shacked up in apartments and tripled up on roommates to split the costs. In the last three years, mortgage interest rates have fallen tremendously, creating a good opportunity for people with means to get in on a house. But who's got the means and opportunity? Unemployment for twenty-somethings is twice as high as the national average. Banks have tighter credit conditions on all but the highest-quality borrowers.



You can focus on the loudest numbers and conclude that young peoples' aversion to home owning is an overreaction to a unique recession. Housing prices have fallen by a third in some cities. Couples have had a few years to pay off their debts. Mortgage interest rates are historically tiny. Could there possibly be a better time to buy?