“No, it’s not for me, I’m not going to make the mistake that my parents made. They’re trapped in their homes, and I’m going to try to be more flexible.”
This phrase should curl the toes of every real estate agent in the country. This is a phrase that the demographer Cheryl Russell who is studying what 25–29 year olds thinking about buying real estate has been hearing recently.
Yes those same 25–29 year olds that comprise a large part of the first time home buyers that we need so desperately to solidify the market. This may explain why the percentage of first time home buyers dropped from it’s normal 40% to 34% the past month.
The Los Angeles Times article goes on from there:
But I see a resurgence in rentership. As these renters get a little older, they’ll want more specific features in their rentals. If I were a developer, I’d be very interested in rehabbing single-family homes and then turning them into rentals, but I’d make them more attractive for these young adults by adding bathrooms. If they’re going to have to have roommates, they’re going to insist on having their own bathrooms.
Homeownership peaked in 2004 at 69%. We are now at 66.9% and Ms. Russell is expecting that number to drop to between 64% and 66% of Americans to own their own homes over the next few years.
The real estate industry has an expectation that American’s are driven to own their own home. The American Dream.
Well the next generation of first time homebuyers may disagree. They have seen how home ownership may lock someone into a regional area instead of moving to where the jobs are. They have seen the effects of lost equity. They also are facing an unprecedented amount of educational debt that is precluding them from entering the job market to begin with.
The loss of a good percentage of the first time home buyers is going to continue to put pressure on the American housing market for years to come.
Makes sense if you see a house as a depreciating asset, which they have been recently.
Yes but they are also not of an age where they want to settle down. After 30 we'll see
Some people settle before 30.
Even though homes right now are depreciating in most areas, real estate is meant to be a long term investment. It always has been. Home buyers should remember this and keep this in mind when they are looking to buy real estate.
This actually depends on where this demographic decide to move. In places like Las Vegas, young people do opt to buy houses because of the affordability, but if they decide to move into places like San Francisco or New York, where most of the available employment are, properties are at the premium, so renting is the only option.
Changing the mindset of 20-somethings is not an easy task. When it comes to big decisions like 'buying a home' it's best to simply provide them with as much credible information as possible and let the facts influence the final verdict. This article about 1st time home buyer tax credits, may be a helpful tool! http://snoopzone.info/blog/first-time-home-buyer-…
less buyer in market in age span of 30-35 bcz of less soci-economic values they are adopting.
Great post. This really makes a lot of sense where I am living and the housing market in my area. Thank you
Perfect time to buy in our city – lots of great homes that are sitting empty. But if you're unsure about your job, I totally can see the wait and rent mindset. Really interesting how the pendulum swings -4 years ago my friend said she was having a hard time finding renters. I wonder how she's doing now?
They are just starting. Just rent first and when they have enough savings then they would be buying their first house.
Completely agree.
Very interesting. As someone just exiting this demographic, I'm surprised that the value of home ownership is becoming lost on the younger generation. In our fast-paced world with transient jobs and short attention spans, it's important for agents to reiterate the value of the long-term investment owning a home can provide – if it's a reasonable financial goal.
The first phrase of this article is really very interesting and I am agreed with it. Our youth generation is more inclined towards renting than buying condos or villas because buying a property restricts them to their properties only.
In real estate markets, first-time buyers make up 40%-45% of all purchasers. They play a critical role in purchasing starter homes so those owners can buy more expensive homes.
CQF @ http://www.youtube.com/watch?v=JVzm9VU5B0g
perhaps you're joking – the information is already two years, and I first heard about this
i guess, they weigh, and try to realize if that place can be perfect for them to settle.