Homeowners often engage in NIMBYism because they are conservative, risk-averse, and are cautious out of fear that the project might fail… Renters often engage in the same behavior, not because of fear it will fail, but because they’re afraid the same project might actually succeed.
The decline in young home owners is a puzzling trend. Interest rates have steadily declined over the last 30 years. Mortgage lending has loosened. Women have ascended in the workplace and supplemented their spouse’s earnings. How in the face of all of these positive developments did home ownership among the young keep falling?
The world is going to be an interesting and potentially painful place for the next few decades, as older generations learn that their assumptions about how the world works don’t hold true for younger generations.
“What do you mean you don’t want to own a house? Everyone wants to own a house!”
They are waiting until they are older to get married. Waiting longer than ever to start a family. They are saying no to expensive cars and yes to jobs with more flexibilty. The American Dream does not always include buying a house, nice car and high salary. It means being free to do what makes you happy. Older generations need to recognize younger generations may have a better idea of what happiness means than they ever did. Most importantly, young Americans are not going to let the Federal Reserve or anyone else tell them when they should buy a house.
In the 1990s and 2000s, 77% of housing demand was for large, single-family homes on grassy lots. But the previous generation’s wants don’t match the next generation’s:
“[Baby Boomers] will want to sell their homes, and they’re hoping there are people behind them to buy their homes,” says [Arthur C.] Nelson, director of the Metropolitan Research Center at the University of Utah. […]
A vast majority of today’s households with children still want such houses, Nelson says. But about a quarter of them want something else, like condos and urban townhouses. That demand “used to be almost zero percent, and if it’s now 25 percent,” Nelson says, “that’s a small share of the market but a huge shift in the market.” And this is half of the reason why many baby boomers may not find buyers for their homes.
