Economist Predicts Millennials Will Greatly Increase Presence in Home Market in 2015

first_img About Author: Tory Barringer The Best Markets For Residential Property Investors 2 days ago Demand Propels Home Prices Upward 2 days ago Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington’s student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News’ sister publication, MReport, which focuses on mortgage banking news. December 2, 2014 1,102 Views The Best Markets For Residential Property Investors 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago Share Save Sign up for DS News Daily Tagged with: First-Time Homebuyers Forecast Home Values Housing Affordability Millennials Zillow Home / Daily Dose / Economist Predicts Millennials Will Greatly Increase Presence in Home Market in 2015 Subscribe Related Articles  Print This Postcenter_img Previous: Consumer Sentiment Rises for Fourth Straight Month Next: October Sales, Prices for Existing Homes Top 10-Year Average Data Provider Black Knight to Acquire Top of Mind 2 days ago The Week Ahead: Nearing the Forbearance Exit 2 days ago Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Demand Propels Home Prices Upward 2 days ago First-Time Homebuyers Forecast Home Values Housing Affordability Millennials Zillow 2014-12-02 Tory Barringer Data Provider Black Knight to Acquire Top of Mind 2 days ago in Daily Dose, Featured, Market Studies, News While millennials so far have yet to find their place in the housing market, the stage is set for younger Americans to become the driving force in the residential sector in 2015, according to a forecast from Zillow.In his 2015 outlook, Zillow’s chief economist, Dr. Stan Humphries, predicts millennials will take on a much greater presence in the housing market, overtaking generation X as the largest group of homebuyers.”Roughly 42 percent of millennials say they want to buy a home in the next one to five years, compared to just 31 percent of generation X,” Humphries said. “The lack of home-buying activity from millennials thus far is decidedly not because this generation isn’t interested in homeownership, but instead because younger Americans have been delaying getting married and having children, two key drivers in the decision to buy that first home. As this generation matures, they will become a home-buying force to be reckoned with.”Analyzing current and expected trends, Humphries says a growing number of generation Y renters will be motivated to make their first purchase as rental costs rise an average 3.5 percent annually and home value growth slows to a yearly rate of 2.5 percent.”As renters’ costs keep going up, I expect the allure of fixed mortgage payments and a more stable housing market will entice many more otherwise content renters into the housing market,” he said.At the same time, he expects homebuilders will take a cue from this year’s underwhelming new home sales figures and make a switch to build cheaper homes to narrow the price gap and make their stock more attractive.”In recent years, home builders seem to have made a conscious decision to sell fewer, more expensive homes instead of more, cheaper homes,” he said. “In 2015, that will change, especially as demand moves toward the lower end of the market as millennials begin buying en masse.”While those factors will work in the favor of first-time homebuyers, Zillow also expects the housing market as a whole will shift more to the advantage of buyers, who have struggled throughout the recovery in what has largely been a seller’s market: low inventory, tight credit, and intense competition from investors and all-cash buyers.Humphries says the tables will turn in 2015 as more inventory comes to the market, giving buyers more negotiating power and putting pressure on sellers to compromise.”This more balanced market will be smoother sailing for everyone, both for buyers in search of a competitive advantage, and for sellers who turn around and become buyers themselves,” he said.Based on local income patterns, home prices, and affordable housing stock, Zillow predicts 2015’s best markets for first-time buyers—especially those in the millennial age range—will be Pittsburgh; Las Vegas; Chicago; Atlanta; and Hartford, Connecticut. Servicers Navigate the Post-Pandemic World 2 days ago Economist Predicts Millennials Will Greatly Increase Presence in Home Market in 2015 Governmental Measures Target Expanded Access to Affordable Housing 2 days agolast_img read more