The United States real estate landscape has changed over the years and we may see more changes over time.
At this point, not only families with children are buying homes. Consumer Reports says that since the Great Recession, the number of Gen Ex who own homes have fallen higher than any age group. Whereas the millenials, with a number of roughly 75 million Americans are entering the market in huge numbers although it has to be said that they are buying homes at a later stage in life.
Many homeowners are stuck in lower-priced homes, hence, the first-time buyers of every demographic have limited choices and mostly inflated prices, Consumer Reports continues. In addition, although banks have become more lenient, a stellar credit is still one of the stiff requirements to be met. Plus, there is the federal guidelines that proof is needed to show that a borrower can meet the obligations buying a house entail.
Michael Alexander, president of Infiniti Financial Group, a mortgage lender in Deerfield, Ill, says, "The lending market has eased up quite a bit, but lenders are stricter than ever when it comes to documentation."
Now, what do millenials actually value? Consumer Reports adds that, "The Consumer Reports National Research Center surveyed 1,573 millennials nationwide to better understand their attitudes toward housing. Overall, they believe firmly in ownership. Though just 26 percent currently own a home, 71 percent aspire to do so. Their top reasons include a desire for more privacy, the ability to make a space their own, and the wealth-building benefits of homeownership."
The main reason why most millenials are not able to afford a home is because they did not save enough for downpayment. The main reason? Student loans remain unpaid.
Dowell Myers, a demography and urban planning professor at the University of Southern California says, "Millennials are sick and tired of rent increases, so they're getting into the game in larger numbers."
As to preference, they want a home with close proximity to family and friends. For Gen Ys, meanwhile, the house has to be move-in ready.
On the other hand, Hispanics are growing and so is their demand for housing, with a number of about 55 percent of new homeowners this decade. Most of them living together with familes under one roof or multigenerational living. In fact, "36.4 percent of women ages 18 to 34 who lived with their parents in 2014 was the highest level since 1940. Even more adult men (42.8 percent) lived at home in 2014. It's no wonder that 13 percent of home purchases last year were by multigenerational households," the report says further.
On to the baby boomers-they occupy 40 percent of households in the country and have control over 54 percent of the total household wealth.
What about the tiny houses that is gaining popularity nowadays?
Lawrence Yun, chief economist for the National Association of Realtors, says, "The tiny-house movement is pretty tiny. People might seek smaller units for affordability or environmental benefit, but they quickly realize that, in terms of comfort, it's not a permanent solution." She added that tiny houses with1,000 square feet hardly composed of one percent of U.S. Sales in the last 5 years.
1,000 square feet made up less than 1 percent of U.S. sales from 2010 through 2015.
