Housing Non-Recovery Culprits: Millennials or the Middle-Aged?
Many pundits, economists, and businessmen are saying that millennials–saddled with student loan debt, unsure of job security (or are without jobs), and scared by the housing crisis half a decade ago–are holding back the general housing recovery necessary for a full-fledged economic recovery.
But, more and more are now saying that millennials aren’t to blame. It’s the middle-aged who were most hurt by the 2007-09 financial crisis that are not buying homes, while millennials’ home ownership rates are relatively the same as past generations.
Erin Carlyle of Forbes reports:
Housing’s Non-Recovery: Middle-Aged Americans, Not Millennials, Are The Problem
Much has been made of the supposed problem: the Millennial generation, aged 18-to-34, saddled by student debt, is getting locked out of the housing market. First-time home-buyers are holding back the housing recovery, headlines proclaim. But according to a recent study from Trulia TRLA +3.39%, it’s people age 35-to-54 who are truly suffering.
In fact, Millennials as a group aren’t buying fewer homes compared to past generations at all–at least when demographic factors are taken into account, argues Jed Kolko, chief economist at Trulia. He says that the the homeownership rate published by the Census portrays a misleading picture, and that homeownership among young adults is actually now on the rise. He writes:
The demographics of 18-34 year-olds have changed dramatically over the past 30 years, between 1983 and 2013, such as:
The percent married fell from 47% to 30%
The percent living with their own children fell from 39% to 29%
The percent non-Hispanic white fell from 78% to 57%
Each of these demographic shifts is a headwind for homeownership. Young people who are married, have children, or are non-Hispanic white are more likely to own a home than among young people who aren’t.(Indeed, Census data shows homeownership rates for the first quarter of 2014 highest among non-Hispanic whites, at 72.9%, followed by 55.8% for the category of All Other Races, 45.8% for Hispanics, and 43.3% for Blacks.
Housing's Non-Recovery: Middle-Aged Americans, Not Millennials, Are The Problem (Forbes)
Comments
The housing bust was a gov construct. If the gov hadn’t meddled in the housing market by placing pressure on the banks to make loans that never should have been made, things would have been totally different.
The Census Bureau was part of the whole housing bust. It has no business collecting data on home ownership at all since that data got misused. I doubt that anyone analyzing the data has a real grip on what happened and the true impact the implosion had on the market. I know some middle aged are not feeling the same way about home ownership as they used to. The gov played a huge part in inflating and then deflating home prices leaving many owners owing more than the houses were worth and knowing that none of it needed to happen.