Sometimes lagging behind is a good thing. Here in Greensboro and The Triad, we lag behind some other parts of the country in some key real estate metrics. Trends happening in the West and in metropolitan areas across the country take a little extra time before they get to us.
That's why I am a little concerned about a trend developing across the country, one certain to get to us in the near future. I am talking about the (in)ability for millennials - basically between the ages of 20 and 35 - to buy their first home.
A recent Bloomberg report identified 13 major housing markets where millennials can no longer afford to buy a home. These are markets where a young homebuyer, with average income for his or her age group, would be seriously 'upside-down' immediately upon buying the median priced home. In San Jose, for example, a typical millennial would be more than $80,000 short on income needed to make the median home affordable. In Denver, the shortfall would be $2,620. (It is a fascinating chart, well worth a look!).
In a companion piece, Bloomberg identified the 10 most affordable markets for millennials. It included Philadelphia, Atlanta, Houston and Dallas as cities where more than 60% of the listings were affordable for younger buyers. However, the truth is, the unaffordable list is growing and the affordable list is shrinking.
It's really a bit of a trap. As housing prices increase, slowly pushing affordability to the brink, rents are actually rising faster. A young person NOT buying a home today may find themselves priced out of the market in a year or two and stuck in an ever increasing rent-spiral that will leave them house-poor . . without even owning a house!
If you are a renter - young or old - here is the best advice I have for you:
If you have any thought of someday owning your own home, get started today. Next year or the year after may be too late.
And, the best way to get started today is to get in touch with the professionals at GreatNest. We'll work with you to determine what your purchasing power is, identify mortgage programs to maximize that, and then find great houses you can afford now. You'll find our no-pressure, educational approach to be comfortable and easy. Even if it turns out that buying today is not the best course of action, we'll help you put together a plan that will make it a possibility in the future.
GreatNest is a full service real estate company charging a low set fee instead of a percentage commission. We serve buyers and sellers in Greensboro, High Point, Winston-Salem , Summerfield, Oak Ridge, Jamestown and surrounding areas. You can reach us at (336) 790-5210 or by emailing Steve Vincent. Visit our website: greatnest.com.