Housing Recovery Leaving Millennials Behind?
Published March 9th, 2014
GAINESVILLE - Experts say the housing recovery is leaving millennials behind the economy has picked up and mortgage rates are currently low, however for millennials-- those born after 1980, that doesn't mean they are settling down.
In fact, statistics show homeownership rates decline the most among the younger generation. Some in the real estate business say millennials are disregarding ‘for sale’ signs and seem satisfied with renting. Howeve what impact might that have on the housing market?
Eleanor and Liz Horne are house shopping in Gainesville. "It's a huge time to buy... Mortgage rates are still very low... Lots of competitive products in the mortgage market," Gia Arvin a broker for Matchmaker Realty said.
However Eleanor, a millennial, says she can only buy a home with financial help from her mother, Liz. “We'll go splits on the down payment. She'll be accruing acuity and right now prices are low and mortgages are cheap," Liz said.
Since 2006, 25- to 34-year-olds experienced the largest decline in homeownership rates in the country, according to a USA Today analysis of Census Bureau data.
"My daughter has found a good job but it doesn't pay a tremendous amount of money... And many of my friends' kids I know... Have a student loan which is a mortgage in itself... They cannot get a job in their field and they are working retail or food service... And that is not what they got a degree in," Liz said.
A local broker says they've noted a lack of interest in home-buying from the younger generation. "So they don't have that type of money down so they're choosing to rent. And just over all i think there is a trend in America, as far as millennials thinking it’s not a big deal to settle down... It's not important. They're changing jobs, they're changing locations now more than ever," Arvin said.
Ivan Sacks a financial strategist in Dallas, Texas says this decline can greatly affect the housing market in the long run. "Well what I think we will be looking at is that the next generation, let's say we go ten years out... We're going to find people that don't have a house. And houses will probably be going up in price. And interest rates will be a lot higher," Sacks said.
Sacks also said baby boomers may find it harder to sell their properties, without millennials buying.
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