HOUSINGNEWS REPORT
MY TAKE
compensate employees at increasing rates that would keep up with the rate of increased housing costs.” With an inability to purchase, the pool of potential first-time homebuyers continues to add to the demand for rental housing in many communities, thus increasing the prices of rents being paid by consumers while also taxing the ability of these potential first-time homebuyers to save for down payments. The increased pricing in rental housing also motivates institutional investors to retain their investments in residential housing across the country, maintaining the largest inventory of investor-owned residential housing our country has ever experienced, and limiting residential inventory available for purchase.
“Down payment assistance programs, grant programs for inner city housing, and government-backed FHA and VA financing are fast becoming the vogue methods of financing in assisting first- time home buyers, as well as veterans,“ said Neeley. “So long as real estate agents can find the inventory.” According to a 2015 ACS study of the National Association of Homebuilders (see chart below), “homeowners with higher family incomes tend to live in the newer residential units. In 2015, the average household income for owner-occupied homes built after 2010 was $ 121,577, which was higher than the $86,328 average family income for those living in homes built before 1969. Moreover, younger homeowners are more likely to live in newer homes. Homes built after 2010 are headed by homeowners with a median age of 44
years, compared to homes built prior to 1969 owned by householders with a median age of 58.” These statistics imply a growing market for renovations for older homeowners who can afford the cost of renovations to stay in place, and also show that younger home buyers are electing to purchase newer inventory homes, likely at least in part to avoid the added costs of deferred home maintenance that comes with older homes. While increasing prices have caused many homeowners to remain in homes longer, there is one sector of the market that has seen improvement in increasing inventory and sold transactions. The national luxury housing sector has experienced an increase in available inventory as
WHO IS OCCUPYING DIFFERENT HOUSING STOCK? HOUSING INCOME (LEFT AXIS) AGE OF HOUSING HEAD (RIGHT AXIS
With an inability to purchase, the pool
70
140,000
59
of potential first-time homebuyers continues to add to the demand of rental housing in many communities, thus increasing the prices of rents being paid by consumers while also taxing the ability of these potential first-time homebuyers to save for down payments.”
58
57
55
60
120,000
50
50
100,000
44
40
80,000
30
60,000
20
40,000
10
20,000
0
0
1969 or earlier
1970 to 1979
1980 to 1989
1990 to 1999
2000 to 2009
2010 or later
12
JULY 2017 | ATTOM DATA SOLUTIONS
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