Owning a home isn’t the American Dream of our parents’ generation.
Today, home ownership has hit a near five-decade low, despite the fact:
- The average age of a first-time home buyer has not changed.
- The length of time it takes to go from rental to full ownership has barely budged upwards.
- Mortgage rates have declined considerably, although housing costs have risen.
So, why are fewer of us buying homes? Here are 7 disturbing trends:
- More young adults still live with their parents, destroying independence, incentives and a vision for them to own their own home.
- The desire to not get married, or just co-habitate with a significant other.
- A higher divorce rate, prompting seniors to move and create new household arrangements.
- Lack of income. Many millennials who should be saving income to buy, are victims of an eight-year gap in income and job upper mobility. Lack of economic growth in the last eight years has stagnated wages, making home ownership a reach for many young adults.
- Too many college kids took courses with no appreciation to the technologically changing modern world. An art degree is great, but those jobs are limited.
- A shift in thinking that leans on entitlements, not incentives, for their future.
- In some areas, such as California, government policy has created impossible high costs for home ownership.
The culture shifts in the American family and economic reality explain why fewer Americans are settling down into home ownership.
Home ownership keeps declining, according to the Joint Center for Housing Studies’ detailed and comprehensive 2017 State of the Nation’s Housing report, in part because homes prices in many markets have continued to go up while wages have not kept pace.
Getting America’s economic engine back on track would do wonders.
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