Loan limits will likely go up to $625K in 2022, but FHFA hasn’t announced it yet. Still, higher home values have convinced some lenders to boost loan limits now.WASHINGTON –
Is a Turnaround Looming for the Homeownership Rate ☘ Hoey Team ☘ eXp Realty Florida
Dated: August 12 2019
The homeownership rate fell slightly to 64.1% in the second quarter, according to U.S. Census Bureau data released this week. While the number of new households is rising, the homeownership rate was mostly flat during the quarter due to the increase mostly coming from new renter households. The number of new renters was larger than the number of new owners for the first time since the fourth quarter of 2016, according to census data.
“The housing shortage, especially at the level of moderately priced homes, has prevented financially capable renters from owning,” Lawrence Yun, chief economist of the National Association of REALTORS®, said in a statement about the latest homeownership rate numbers. “More home construction is needed to relieve the housing shortage and allow more Americans to participate in the wealth gains associated with ownership.”
Indeed, the homeownership rate is below what it should be, Mark Fleming, chief economist of First American Financial Corporation, a title insurance provider, noted in a separate report this month. In 2018, the homeownership rate underperformed potential demand by 8.7%, and Fleming points to young adults and their lifestyle choices as the main culprit.
Millennials have trailed their generational predecessors when it comes to homeownership. They’ve delayed marriage and children, which are often lifestyle triggers to purchasing a first home. Fleming notes a six percentage point difference in homeownership between millennials and Generation X at the same age of 30 years old.
“But the bulk of millennials have yet to turn 30, which signals higher potential homeownership demand may be on the horizon,” he notes.
The largest group of millennials by birth year will turn 30 in 2020, which puts them entering their prime homebuying years, he notes.
Millennials—the most educated generation--have the highest incomes across their generational cohorts, even when salaries are adjusted for inflation. Comparing the millennials with their predecessors at age 37, inflation-adjusted median household income is $77,000 for millennials, $72,000 for Generation X, and $69,000 for baby boomers.
“Higher income leads to higher house-buying power,” Fleming notes. “Coupled with today’s 3.8 percent 30-year fixed-rate mortgage, 37-year-old millennials can afford $35,000 more home than Generation X and $52,000 more home than baby boomers at the same age.”
Fleming says the homeownership rate is poised for a turnaround soon. “The gap between the potential and actual homeownership in 2018 narrowed slightly as the growth in homeownership modestly exceeded the increase in potential demand,” he says, citing First American’s Homeownership Progress Index. “We expect the homeownership rate to further close the gap with potential in the years ahead as millennials continue to make important decisions, such as attaining an education and, later in life, getting married and having children.”
Article content from NAR Realtor Magazine and First American
Also; please check out the other blogs, and tabs to many other Links, Updates & Reports that we have here on our informational website. ☘
We hope that you find the information useful. If you have any questions, please do not hesitate to contact Barry or Kim with the Hoey Team ☘ brokered by eXp Realty
“Please Share this and our informational website with anyone who you think the info will help.
Feel free to refer any family or friends; it is the greatest compliment that you can give to us; we really appreciate referrals from Past Customers, Friends and Fellow REALTORS, who we help in any way we can.
Most of our business is referrals by word of mouth; from past Sellers and Buyers who we have helped; please ask for and check out our testimonials and Sales Stats. Thanks, Barry & Kim ☘”
"Your Real Estate Concierge" If you are looking for a REALTOR® or one-stop Real Estate Team who will fully communicate; promptly, professionally, and in detail with you, to efficiently help you wit....
Latest Blog Posts
A price increase of almost 20% year-to-year is unheard of – until now. Home prices hit record highs in 19 of the 20 cities included in monthly Case-Shiller reports.WASHINGTON (AP) ;
Today’s market isn’t like the boom-bust cycle leading up to the Great Recession: Tough loan standards are the norm, plus many factors have kept housing supply low.MCLEAN, Va. –
Hello,Barry & Kim with the Hoey Team 🍀 239RealEstateDeals.Com LLC ☘ hope that you and yours are doing good; wherever you are located at this time.Hot off the press