Has the nation hit a milestone, where homeownership is no longer part of "the American dream"? We've been in a similar situation before.

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Housing is expensive in Seattle, especially in the 84 square miles of the city, especially in its most desirable neighborhoods.

Distrust anyone peddling quick “solutions.” Constructive responses will take years to implement, involving negotiation among many stakeholders. And even then, demand forces tend to keep prices relatively high in star cities.

I started as a business reporter in San Diego covering real estate. Housing was pricey and many wages were low (“sunshine dollars). Thirty-four years later, homes there are more expensive than ever, even though vast areas of farmland and rural areas in the county have become subdivision pods.

Welcome to the situation in most West Coast cities. Even when real estate goes into a bust there, prices soon bounce back and keep rising.

What you need to know

Metropolitan Seattle was slower than California cities to arrive at this level. The tech boom and Seattle’s cost advantage over the even pricier Bay Area drove prices to records. Rising population translates to more demand and housing inventory hasn’t kept up. So here we are.

But an important question concerns the nation, not just Seattle: Have we reached an inflection point where homeownership is no longer an attainable piece of “the American dream” for millions who once could buy? A house is typically the largest asset of a household and the most common way to build household wealth. Being an owner traditionally gave one a greater stake in a community’s health (at least before flippers).

I pose this within the conventional understanding of owning a home. When “affordable housing” is used, it’s often shorthand for low- and lower-income rental housing. This is an important issue, too, but one for another column.

The homeownership rate for the United States peaked in 2004 at 69 percent of owner-occupied units. That fell to 63 percent in 2016, a consequence of the Great Recession. It was 64 percent in this year’s second quarter.

So far, so not bad. But wages aren’t growing for most people. Nearly 80 percent of full-time workers say they live paycheck-to-paycheck.

Housing developers are still shy about making commitments after the housing-bubble collapse. Bankers complain that mortgage rules are too tight and convoluted. Construction companies are having a difficult time attracting young workers.

Home prices are at or near record highs nationally. Mortgage rates are rising. The inventory of starter and low-priced houses is less than historic trends. And the housing market may be headed for a big slowdown.

Such a dip would cause fewer houses to be built. The 1.2 million housing starts in June are historically low for this point in a post-World War II expansion.

Finally, the new Republican tax law caps the deduction for local and state property taxes at $10,000, a further disincentive to buyers, especially in higher-tax, higher-cost blue states.

On the other hand, ownership was not always a given. The nation is moving backward in so many ways, notably the Gilded Age accumulation of wealth at the top and rising inequality.

In 1900, the homeownership rate was only 46.5 percent, according to the Census Bureau. In 1940, it was 43.6 percent. (It varied widely among the states, very low in the South, higher in Washington).

Historical comparisons are tricky. America in 1900 included tenement-filled cities, compact small towns and many still living on farms. The nation’s population was 76 million, compared with an estimated 328 million today.

Still, it’s a useful starting point, because ownership began to rise dramatically after World War II, hitting 55 percent in 1950 and 63 percent in 1970.

This was a consequence of federal programs such as low-rate VA and FHA loans, as well as tax subsidies — especially the mortgage interest tax deduction. Freeways, automobiles, cheap gasoline — even federal flood control — helped subsidize sprawling suburbs outside central cities.

Not everybody was invited to the party. Mortgage discrimination and other barriers against minorities were common, with the feds either looking the other way or actively encouraging them. This enhanced segregation and destroyed the ability of many minority families to build wealth. By the time the Fair Housing Act was passed in 1968, much damage had been done, and enforcement remains a challenge.

Still, this ownership rise was essential to the best years of the middle class. So were good, secure jobs, with benefits including pensions and often union protections, along with rising wages.

Ownership rose again from 1994 through most of 2006, this time encouraged by policies from the Clinton and George W. Bush administrations to broaden “the American dream” even further.

This came to grief with the housing meltdown. Many on the right continue to argue this was the result of the federal Community Reinvestment Act, Freddie Mac and Fannie Mae (dog whistles for “minorities getting loans they didn’t deserve”). This is not true. Deregulation and Wall Street gambling were the main culprits.

Now, nine years after the end of the recession, Harvard’s exhaustive State of the Nation’s Housing report argues that the homeownership rate may have stabilized.

But it adds some important caveats. Black ownership is at a 30-year low, for example. Also, young adults are buying at lower levels, whether because of price or millennials choosing to rent. (I didn’t buy a house until I was 45 — right or wrong, I enjoyed being on the move and didn’t want my bosses to hold a mortgage over my head).

Indeed, much of the new stability is coming from strong ownership by people age 65 and older.

Not everybody is a victim. Far from it if 64 percent own their homes, above the “good year” of 1970.

It’s also true that housing prices vary considerably, with some of the best deals in the Great Lakes region. Prices are higher in the Northeast and West Coast largely because of demand.

But the Urban Institute, in a recent report, said the United States has lost ground in ownership compared with 18 developed countries. Today’s new normal, if it sticks, would leave millions behind.

The experience after World War II shows that only strong, smart policies on the federal level will raise the opportunities to own a home.

This time they need to be inclusive, less dependent on environment-damaging sprawl and policed to prevent hustles.

But the other part of the remedy is raising wages and broadening opportunity. This wasn’t a problem in the 1950s and 1960s. You know, when some said America was great.