A housing economist for MetroStudy just outlined 4 macro trends making it tough for young people to get into the housing market:
1. Older millennials were too young and too in debt to take advantage of the housing crash of the late 2000s.
2. In 2018, as millennials started to make more money, they were able to grab the few homes they could from a low-supply market, pushing prices up even higher.
3. Homebuilders are building big houses instead of starter homes so new houses are out of most millennials’ price ranges.
4. People who bought those starter homes in the past few years aren’t selling because they got locked into super low mortgage rates.
Sounds hopeless, right? There was a short window in which well-off millennials were able to easily get into the market and then the rest of us are screwed.
Couple that with the fact that the NAR just said 1 in 10 homeowners had an adult child move back in with them in 2018 and you might feel tempted to give up on the home ownership dream.
What a nice, tidy narrative!
Thankfully, it’s not that bleak. National statistics miss a wide and varied housing picture, and your local market could be wildly different from the national norm. If you’re in San Francisco or NYC, yeah, you’re going to have more trouble finding a home than I might in Detroit.
So what should you take away from this? Yes, it’s a tougher home buying market than it has been, and it’s hard to find a good deal. But learn your local market. There are tons of tools you can use to find homes without even having to leave your house, good local pros are happy to help you do homework without pushing you, and we’re happy to field any questions you send us.
Like Julian and I say: let your dream home guide your search, not headlines written thousands of miles away from you. With any luck, your home purchase will be one of the 6 million homes changes hands every year despite any bleak headlines.