Some interesting trends are developing in the housing market. One particularly interesting and perhaps disturbing trend is the age of homebuyers. Currently, young adults are more hesitant to buy a home today than at any time in the past quarter century.
Moving forward, let’s say the next 2-20 years, instead of seeing the home buying market level out; I suspect drastic changes never before seen in the housing market will continue. Many kids and teens are seeing their parents with upside-down mortgages or homes that have been foreclosed on. They are also seeing unemployed parents or family friends who are not able to move to take a new job, because they are tied down to a house that is not selling.
Also, all of the people who have suffered through a foreclosure will have a hard time buying for at least the next 7 years. After renting that long, are they going to want to buy again? What will that do for the current inventory and the inventory that has yet to come on the market?
Even as things continue to turn around, I suspect housing is going to have drastically different rules which will yield some unusual results for at least the next decade. I heard it described as we have moved from the emergency room, to intensive care, and we’re now in recovery, but we are still in the hospital. When we do finally “checkout,” running the race as we did in the past is not going to be an option.
What are your thoughts on this?