Student Debt for Millennials vs. The Housing Recovery
The latest in a series of questions raised by industry experts is how will the influx of millennials with stacks of college debt affect the housing market?
We have ALL had our sights set on the Millenial generation for years…no pressure guys! This populous generation is poised to steer the housing market one way or the other. With the latest statistics showing first time homebuyers down 5% over 2013, analysts are left with their collective mouths agape.
For the first time in nearly three decades, less than 4 out of 10 buyers are embarking on their inaugural journey to the American Dream.
The American Dream Tanks?
While some are screaming, “what is the holdup?”Millenials are shrugging and giving it the, “are you kidding me” look. Entering a workforce that has generally seen flat wages for the last 7yrs, a tough job market, fierce competition from investors and tight lending restrictions looks comparable to Hurricane Katrina, formidable, to many young Americans.
We can analyze data until we can’t see straight but if you want real information, it’s best to go straight to the source. Most young Americans under 30 do not feel financially stable enough to take the plunge. Many have witnessed or personally experienced the anguish of losing a home and how detrimental that can be for decades to come as blight on credit reports. There is some comfort in renting, no large scale unexpected expenses or ongoing maintenance to plan for.
Let’s not forget the ongoing narrative regarding difficult and at times insurmountable lending restrictions, see my last blog post on Ben Bernanke’s (yes THAT Bernanke) refinance woes.