Source: Fortune
Summary
Jessica Lautz, deputy chief economist at the National Association of Realtors, has been tracking the generational trends in housing. She notes that older millennials (36-45 years old) are now living a boomer-style existence, owning their own homes, while younger millennials (27-35 years old) are struggling to afford homes. Research from the Federal Reserve Bank of Minneapolis shows that the real under-35 homeownership rate is closer to 22% than the widely cited 37%. Lautz attributes this to high rents, student loans, and credit card debt. She also notes that younger millennials are being pushed towards a housing arrangement not seen in America for over a century, with more families doubling up during times of unaffordability.
Our Reading
The numbers tell one story. The gap between older and younger millennials has grown too wide to report as a single number. Older millennials have become the highest-earning, biggest-spending buyer segment in the entire housing market. Younger millennials are still fighting the battle their older counterparts just won. The Minneapolis Fed research underscores how difficult housing affordability is, and how difficult high rents can be in many communities. Lautz describes the younger cohort’s predicament as a reversion to a much older pattern, with more families doubling up during times of unaffordability.
This is what happens when the American Dream becomes a hand-me-down.
Author: Evan Null
