Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
They blame the shortage of new construction start homes on Millennials, and their desire move away from suburbs and towards urban centers. (Well, part of the blame, anyway.)
The theory is that when people insist on moving back to urban areas, it constricts builders from creating adequate inventory. Building restrictions and land costs keep builders from creating the volume of houses in an urban area than could be built in the suburbs. So builders forego the starter homes and just focus on building expensive homes.
Another factor is a lot of the smaller resale homes being turned into rentals, since rents are high--and what is driving the rents so high? The would be buyers who want to live in the city but cannot afford the expensive homes that builders are now building.
I'm not sure I agree with this theory, but if it's true, the solution seems inevitable. Sooner or later, people who really want a house let go of the desire to move to the city and the tide turns back to people moving out to the suburbs.
People may strive to find an urban place, but sooner or later pricey rentals are bound to get old. If they can't find something they can afford in the city, they'll head back out to the burbs. Whether the burbs are considered cool or not.
Unfortunately, one needs a subscription to the WSJ to read the article.
But SOME areas are still building new construction in downtown areas as well as the suburbs.
Yeah, sorry about that. I tried to sum it up. I wish I could cut and paste it, but that's against the rules. I also posted in the hopes a few people here have subscriptions, too.
I just read it . Speaking from what I see in L.A , it's really the traffic that keeps people from moving far out.
To really get to an affordable suburb area where more millennials can purchase a home they are looking at commuting hours and hours . Some people do it .
Of course the city will be more attractive to young people but I think people in general if they can afford it .
I see some new development around from KB Homes and some other developers but these are "small lot homes "
There really isn't land so I believe this is considered "infill development" new development in between existing development .
I'm sure if regulations were loosened and more density was allowed prices would be lower in the city but probably still out of reach for many people .
Many urban core /downtown areas in America have improved over the years which of course has made demand stronger and prices higher.
I guess what this article is basically saying is it's still about location location location
Many can buy a very nice brand new house for a low price but many chose instead to pay more to rent small often rundown properties in urban areas .
Its getting a little ridiculous all these millennial articles . I read one the other day that said the reason millennials can't afford a home is because they spend too much on avocado toast ..
which is why there is a push on to make student loans dischargable in bankruptcy - another tax payer bailout.
This is kind of interesting.
"On April 25, the Federal National Mortgage Association, better known as Fannie Mae, announced what it called “innovative solutions” intended to help more borrowers with student debt qualify for a home loan.
The innovations address challenges and obstacles to home ownership due to a significant increase in student loan debt over the past decade and provide access to credit for qualified borrowers."
Personally, I think it's a silly argument. No one is to "blame." I'm not a millennial, but I bought a house where I want to live, which happens to be a residential neighborhood of a city, giving me a 15 minute commute to work, and easy access to theaters, restaurants, museums, sports venues, etc. This is a redevelopment area, and they can't build the houses fast enough to meet demand. Yes, they are on the more expensive side, but less expensive than some of the more established neighborhoods that are even closer in.
It's already relatively high density (not zero lot lines, but very small lots, in favor of lot of public greenspace instead), but these are family homes, with tons of young kids around. If they forced developers to build condos, the redevelopment would have failed, because most families don't want condos, and this isn't right in a downtown area where people expect to live in apartments (regardless of whether they are owned or rented).
And the result would have been that someone like me, not millennial and not looking for a starter home because I was upgrading from that, would have been left high and dry - I still couldn't afford the older established neighborhoods and I have zero interest in moving out to the suburbs and doubling or tripling my commute and losing easy access to all the other city amenities.
which is why there is a push on to make student loans dischargable in bankruptcy - another tax payer bailout.
Yes this is complete BS. No one forced them to sign a loan for thousands and thousands of dollars for a useless degree... They should live with the consequences. Not everyone is entitled to own a home either.
In my area, townhomes are few and far between unless you want to go out on the far fringes of the city. One thing that I feel is contributing to the shortage is the high rents. Because it is so profitable to have rental property in most of the city, investors are swooping in with cash offers as soon as a townhome hits the market. These investors are willing and able to pay much more than the appraised value of the homes. I have several friends who are looking for a townhome now and they are simply not able to get their offers accepted because, as first time home buyers reliant on financing, they are not able to pay more than the appraised value.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
