Tag Archives: millennials

Millenials favor remodeling | Mt Kisco Real Estate

Millennials are finding it increasingly difficult to become first-time buyers. Even for those that have managed to find (albeit shaky) footing on the housing market, it’s not easy. Moving to a bigger and better house is often out of the question, for example. But millennials are a crafty lot; if moving isn’t an option, why not remodel? In fact, over 25% of millennials are choosing to do just that. In this article, we focus on what they decide to focus their remodelling energies on. 

SIZE MATTERS 

As we’ve already mentioned, millennials are either choosing or being forced to stay in their homes. With moving an impossibility, even with growing families, millennials have had to get creative with maximizing space: 

  • Function first. Style is important, but if space comes at a premium, then function is the first thing on the millennial’s mind. 
  • Storage everywhere. Hooks against kitchen walls to hang pots and pans. Drawers under the couch. Pull-out closets. Cabinets against the ceiling. You get the drill. 
  • Natural light. Sometimes it’s impossible to create extra space. So why not the next best thing? Adding a window or skylight can give you the illusion of a bigger home. 

ENJOYING OUTDOOR SPACE 

Millennials are massively investing in their gardens. In fact, it’s becoming kinda cool, with millennials now spending more on average than their parents. Growing vegetables is definitely becoming a thing, with millennials liking growing their own organic food. It’s tastier, better for the environment, and it’s a fun project to get involved in. 

Millennials don’t tend to live in homes with a lot of outdoor space. Gardens are like gold dust, so it’s no surprise that if they manage to get their hands on one, millennials take care of it.They spend a lot of time researching sustainable designs and plants to occupy it.

LOW MAINTENANCE BEATS STYLE 

Millennials are big on homes that don’t really take much effort to maintain. They want practical homes built with eco-friendly products. Homes that are built with cheap and sturdy materials, rather than the stylish but overpriced stuff. Here are two examples of what we’re talking about: 

  • Hard flooring, not carpet. Carpets are expensive, get stained easily, will only be in decent condition for a few years tops (less if you have kids!), and it doesn’t look as cool as hardwood flooring. 
  • Metal roof. Tiles have the traditional vibe going for them, but they’re more annoying to maintain than metal roofing. And it doesn’t have to look worse either; many of the newer metal roof varieties are modern and slick. 

SMART TECHNOLOGY IS THE SMART CHOICE 

Millennials are huge on tech, so it’s no surprise that many of them are turning to smart technology to transform their homes. And it’s not just buying an Amazon Echo. These are some remodelling upgrades that help millennials smarten up their homes: 

  • USB outlets. Power outlets aren’t enough these days. 
  • Built-in speaker systems. When it’s challenging to find space in smaller homes, solutions like built-in speaker systems are a cool way to solve the problem. 
  • Motion sensors. Security is important, especially for millennials living in the big cities where break-ins are a little more common. 
  • Smart thermostats. Not only to save bills, but these also help the environment by limiting your energy usage to when you actually need it. 

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Millennials Are About to Get Locked Out of the Real Estate Market—Again | Bedford Corners Real Estate

Over the past couple of years, rising pay and low mortgage rates finally converged to make make the dream of home ownership a reality for America’s millennials, many of whom had long been locked out of the housing market. But now, the door is on the verge of slamming on the under-35 crowd, leaving young families outside looking through the picture window—again.

That’s the scenario sketched by Mark Boud, chief economist for Metrostudy, a unit of real estate data and marketing company Hanley Wood. Metrostudy surveys housing trends in hundreds of towns and cities from the ground up, by visiting subdivisions to record how many homes are being built, going to contract, and sold—the latter evidenced by curtains on the windows and tricycles in the driveway.

During the housing-bubble frenzy from 2004 to 2006, as Boud recently recounted to Fortune, easy credit sent sales soaring, inflating prices and leading to a gigantic oversupply of new homes. In 2008 and 2009, the banks and other lenders, overwhelmed with defaults and foreclosures, throttled back so hard on credit that demand collapsed, and housing prices went into a tailspin.

The upshot: From 2009 to 2017, the housing market severely overcorrected, with prices steadily rising once again. “Housing went through a long period of undervalution,” says Boud. It wasn’t millennials, he points out, who benefited from the cheap prices and rescued the market. “The millennials had loads of college debt, and many had bad credit in general, often because their previous loans had been foreclosed on. And they were too young to be stable in their jobs,” he says. The upshot: The youthful cohort couldn’t get mortgages from lenders, who suddenly were rejecting all but class-A credits.

Instead, it was the affluent and investors that profited from low prices and soaked up the excess inventory. “The rich were the buyers without the credit problems,” says Boud. “And institutional investors bought houses cheap and rented them out.” In fact, he says, many of these new owners’ tenants were the very millennials shunned by the banks. In terms of home ownership, millennials became the lost generation.

A lost generation comes home

By 2015, the wealthy and the investors had absorbed the excess. America began generating far more new jobs than new homes, as construction was severely constrained by a shortage of ready-to-go lots. Starting around 2017, the millennials got back in the game, in a big way. The job rolls expanded, and wages jumped. The mortgage market reopened for the more well-to-do 30-somethings. So even though credit overall remained tight, sales to millennials rose, from 22% of new homes sales around 2011 to 50% in 2018—an extraordinary figure, given that millennials account for just one-third of the U.S. population.

Now says Boud, the market is once again turning against what’s now the biggest, and still hungriest, class of buyers. “Prices have risen a lot, and they’re still rising because we’re still way under-building compared to household formation,” he says. “At the same time, rates on home loans are rising, making it much harder for millennials to qualify.” The affordability problem will intensify because of the types of homes the builders are erecting. The only way to make money on expensive land is to build big houses, so “the average home size is 3,000 square feet, which is way too big most first-time buyers,” Boud says. “Ten years ago in Las Vegas, that sized house cost maybe $225,000 [thanks to the housing plunge]. Now it costs $350,000, way out of the reach of young buyers.”(

Hence, Boud sees sales shifting back to the affluent who’ve held high-paying jobs for decades, can qualify for more expensive mortgages, and want the big houses. Eventually, he says, the surge in prices will sow the seeds of a correction. But supply is so tight that the drop should be mild––unless America suffers a recession. “In that case, prices would be lower, but employment and incomes would also drop. So millennials could remain locked out.” Another problem: Millennials who secured a 3.5% fixed rate in 2016 or 2017 will stay in their existing home to keep the low monthly payment rather than trying to move up the housing ladder.

The solution, says Boud, is for builders to lower costs by shifting to factory-built homes they can offer at far lower prices. Homebuilders should also work with the banks to offer interest-only mortgages that would hold down monthly payments in the early years, and allow far more millennials to qualify for credit. He also notes that developers need to take steps to lower home owner association dues that can add $200 to a family’s monthly payments. More 2,000-square-foot houses would also be welcome, but for that to happen, municipalities would need to loosen zoning laws to allow far more lots to be subdivided, far more quickly. Today, towns are trending the wrong way, towards even tighter restrictions.

The outlook for sales is strong, Boud says, because so many Gen-Xers and baby boomers are renting, and more of them want to buy homes. Those folks can both afford to buy, and qualify for mortgages on $450,000-to-$700,000 homes. As for millennials, the generation that housing lost, then briefly found is about to be lost once more.

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http://fortune.com/2019/01/12/real-estate-market-millennials/

Millennials drive homeownership rate increase | North Salem Real Estate

The homeownership rate increased slightly in the third quarter, driven primarily by a jump in first-time homebuyers.

The homeownership rate increased to 64.4% in the third quarter of 2018, according to the latest report from the U.S. Census Bureau. This is up slightly from 64.3% in the second quarter and from 63.9% in the third quarter of 2017.

Click to Enlarge

Homeownership Rate Q3

(Source: U.S. Census Bureau)

This increase was driven primarily by first-time homebuyers as more Millennials opted out of renting and entered into the homeownership market.

“Led by another surge in owner household formation, homeownership rates are up again, but those gains are not driven by those who experienced the housing crash and lived to tell about it,” said Skylar Olsen, Zillow director of economic research and outreach. “First-time home buyers drove the market this year.”

“The homeownership rate of the 45 to 55 age bracket dropped quarter-over-quarter, while the under 35 age bracket continues to rally,” Olsen said. “Their homeownership rate is up a whopping 1.2% since Q3 2017 to 36.8%.”

Homeownership among those under age 35 increased from 35.6% in the third quarter 2017 and 36.5% in the second quarter this year to 36.8% in the third quarter 2018, the report showed.

Meanwhile, those ages 35 to 44 years dropped from 60% in the second quarter to 59.5% in the third quarter. This is still up slightly from 59.3% in the third quarter 2017. Those ages 45 to 54 years also saw a decrease, falling from 70.6% in the second quarter to 69.7% in the third. This is also still up from 69.1% in the third quarter of 2017.

Older generations also saw an increase in their homeownership rate. The rate for those ages 55 to 64 increased from 75.1% the previous quarter and 75% the previous year to 75.6% in the third quarter. Those ages 65 years and older saw an increase from 78% in the second quarter to 78.6% in the third quarter this year, however this is down slightly from 78.9% in the third quarter of 2017.

“Today’s report shows that more people are choosing homeownership over renting, and a large part of that story is the historically large number of first-time homebuyers,” said Tian Liu, Genworth Mortgage Insurance chief economist. “In the past two years, first-time homebuyers have purchased at least 1.9 million homes each year. That is more than the pace of household formation over the same period, meaning that the transition from renting to own is the more powerful driver of housing demand.”

“That has also been an important and often overlooked reason for the rapid rise in home prices, as more buyers came into the market,” Liu said. “Paradoxically, the rise of first-time homebuyers, which has pushed home prices up, also is slowing home sales today. These events caused the homeownership rate and home sales to diverge this quarter.”

The Hispanic homeownership rate saw a quarterly drop as it fell from 46.6% in the second quarter to 46.3% in the third quarter. This was still up slightly from 46.1% in the third quarter of 2017.

Among whites, the homeownership rate increased from 72.5% in the third quarter of 2017 and 72.9% in the second quarter this year to 73.1% in the third quarter of 2018. Blacks also saw an increase from last quarter, rising from 41.6% to 41.7%, however the rate dropped from last year’s 42%.

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https://www.housingwire.com/articles/47259-millennials-drive-homeownership-rate-increase-in-q3?utm_campaign=Newsletter%20-%20HousingWire%20Daily&utm_source=hs_email&utm_medium=email&utm_content=67103596&_hsenc=p2ANqtz-_pUkX9OvEYkaBpJ1jmUzH1E6CDF1CW5tJ2zdACxjVFaOimvN7qzgg3CY5GZ8vTRjO9elaur9WodJE-ofZoDFiWSfnEPA&_hsmi=67103596