Millennials’ decision to put off marriage is causing homebuyer levels to be “putrid,” Richard Green, director of the Los Angeles-based USC Lusk Center for Real Estate, tells GlobeSt.com.
Green tells GlobeSt.com, “To me, the most important thing is marriage. Married couples buy, and people aren’t getting married. First-time homebuyer levels are really putrid, and part of that is the financial climate. But also, people don’t want to buy homes until they marry, and the marriage rate has plummeted, and we don’t know when that will change.”
Green adds that he believes multifamily demand is stronger than homebuying demand among Millennials because “when you live in an apartment building, a lot of the day-to-day issues of homeownership go away. When you have a home you have to manage on a daily basis,” that requires an extra amount of responsibility. Of course, he points out, different market segments see a difference in the number of homebuyers vs. apartment dwellers.
There are policy changes currently afoot that should stimulate demand a little, Green says, but these are second to demographics. Moves such as lowering insurance premiums on FHA loans and the GSEs allowing 3% down for mortgages will help homebuying levels, but “compared to who we’re living with, this is small potatoes.”