Upload
others
View
8
Download
0
Embed Size (px)
Citation preview
MILLENNIALS/BABY BOOMERS, MULTIFAMILY HOUSING AND SUSTAINABLE GROWTH STRATEGIES: WHICH WAY IS IT GOING?
June 1, 2015Selma Hepp, PhD, Senior Economist
DEMOGRAPHICS SET THE TABLE POPULATION AND ITS COMPOSITION DEFINE THE FUTURE
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
4,500,000
5,000,000
1909
1912
1915
1918
1921
1924
1927
1930
1933
1936
1939
1942
1945
1948
1951
1954
1957
1960
1963
1966
1969
1972
1975
1978
1981
1984
1987
1990
1993
1996
1999
2002
2005
2008
2011
US Live Births by Year and Generation
Boom X Y Z
Source: Realtor.com Analysis of US National Center for Health Statistics
MILLENNIALS IMPACT ON HOMEOWNERSHIP ONLY TO BEGIN
LENDING STANDARD DROVE 50% OF THE DECLINE BETWEEN 2001 AND 2012
…AND THEY ARE DELAYING ADULTHOOD
8/10 FEEL HOME OWNERSHIP IS IMPORTANT
How important is home ownership to you on a scale of one to 10, with one being not at all important and 10 being extremely important?
0%
5%
10%
15%
20%
25%
30%
1 - Not atall
Important
2 3 4 5 6 7 8 9 10 - VeryImportant
18-26 27-34 All
MOST EXPECT TO BUY A HOME WITHIN 5 YEARS
When do you expect to buy a home?
0%
5%
10%
15%
20%
25%
30%
35%
Within ayear
In 1-3years
In 3-5years
When Iget
married
When Ihave achild
Never Other Don'tknow
3%
23%
32%
17%
3% 2% 3%
17%
MANY YOUNGER MILLENNIALS EXPECT TO BUY WHEN THEY GET MARRIED
When do you expect to buy a home?
0%
5%
10%
15%
20%
25%
30%
In 1-3 years When I get married Don't know
19%
23%
13%
29%
9%
23%23%
17% 17%18-26
27-34
All
MILLENNIALS ARE ESPECIALLY ACTIVEAN ESTIMATED 2/3 OF SEARCHES IN JAN WERE MILLENNIALS
IMPEDIMENTS TO PURCHASEBIGGEST ISSUES ARE SUPPLY, TIME, AND DOWN PAYMENT
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Have not yet found a house that meets my needs
Cannot find a good house in my budget range
Always overbid by other buyers
Just starting to explore
Haven't decided on a specific neighborhood/town
Need to improve credit score
Lack enough funds for down payment
I owe more on my current home than it is worth
Can't sell current home
Currently on a lease
What's Getting in the Way of Making a Home Purchase?Repeat First-Time All Buyers
Source: Realtor.com Survey of Buyer Traffic, January 2015
HOUSING AFFORDABILITY DOWNSHARPLY SINCE Q1 2012
California vs. U.S. – 1984-2014% OF HOUSEHOLDS THAT CAN BUY A MEDIAN-PRICED HOME
SERIES: Housing Affordability Index of Traditional BuyersSOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
0%
10%
20%
30%
40%
50%
60%
70%
80% CA USAnnual Quarterly
AFFORDABLE INVENTORY AVAILABLE TO MEDIAN-INCOME HOUSEHOLDS
SOURCE: CALIFORNIA ASSOCIATION OF REALTORS®
68.8%
29.8%
0.6%0%
10%
20%
30%
40%
50%
60%
70%
80%
2015 Q1
MILLENNIALS’ BIGGEST CONCERNS
What are your biggest concerns about home ownership?
0% 10% 20% 30% 40% 50%
Other
Security
Depreciation of the home value
Losing the home
Responsibility
Satisfaction with home/location
Maintenance/upkeep
Problems with credit, mortgages, taxes
Price/affordability
18-26 27-34 All
BIG LOTS IN THE SUBURBS ARE HIGHLY DESIRABLE
Which of the following features would you like to have in your ideal home?
0% 10% 20% 30% 40% 50%
Other
Don't know/ unsure
High rise building
Urban location
Live/ work space
View
Suburban location
Lots of land/ big lot
18-26
27-34
All
AFFORDABILITY TOPS CONCERNS
URBANITES = SUBURBANITES
• only 13 percent of the total sample lives in or near downtown areas
– represent 10.2 million young people who like living in the urban core
HOMEOWNERSHIP EXPECTATIONS• 70 percent expect to be
homeowners by 2020, only 26 percent own today
• Even among those who do not expect to own in five years, 92 percent believe they will eventually purchase homes
• 55 percent agree and 45 percent disagree homeownership is good long-term investment
• Only 11 percent have applied for a home mortgage, and were rejected and are therefore renters by default.
BABY BOOMERS STAYING PUT
MAJORITY DO NOT PLAN TO SELL HOME WHEN THEY RETIRE
Do you plan to sell your current home when you retire?
Yes, 10%
No, 59%
Don't know/ unsure, 32%
MAJORITY WON’T SELL BECAUSE THEY LIKE THEIR HOME
Why do you not plan to sell your current home when you retire?
78%
10%
8%5%
I like my home
I cannot afford to buy anotherretirement home
I plan to give the home to mychild(ren)
Another reason
PERCENT OF RETIREES WHO HAVE MOVED OR ANTICIPATE TO MOVE
36%
37%
27%do not anticipate movingin a retirement
have moved in retirement
have not yet moved, butanticipating moving
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch
NEARLY ½ PLAN TO DOWNSIZE
What type of new home are you planning on purchasing?
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Larger
Other
Same size, but in a different location
Don't know/ unsure
I do not plan to purchase another home
Detached single-family home
Townhouse/ condominium
Smaller
2%
4%
9%
11%
16%
22%
31%
47%
RETIREE‘S’ MOST RECENT MOVE WAS INTO A…
smaller home, 51%lager home, 30%
same sized home, 19%
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch
MAIN MOTIVATIONS FOR UPSIZING
16%
19%
20%
33%
0% 5% 10% 15% 20% 25% 30% 35%
more room for friends to visit
more prestigious home
more room for additional familymembers to live with me
more room for family members to visit
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch
TOP REASONS WHY RETIREES WOULDN’T LEAVE THEIR CURRENT HOME
28%
31%
42%
44%
48%
54%
0% 10% 20% 30% 40% 50% 60%
I can't afford to move
friends are close by
I love my community
I don't want to lose independence
Family is close by
I love my house
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch
TOP PREFERENCE FOR RECEIVING CARE
own home, 85%
assisted living facility, 10%
family member home, 4%
nursing home, 1%
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch
NUMBER OF NURSING HOME RESIDENTS
1,300
1,325
1,350
1,375
1,400
1,425
1,450
1,475
1,500
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
SERIES: Home in Retirement: More Freedom, New Choices StudySOURCE: Age Wave, Merrill Lynch, Centers for Medicare and Medicaid Services
NEARLY 1/2 PLAN TO MOVE OUT OF STATE
Where do you plan on moving when you retire? N = 45
2%
18%
18%
18%
44%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
Another Country
Norther CA
Other CA
Southern CA
Another State
STAY CONNECTED WITH RESEARCH
CARResearchGroup
CARResearchInfo
On.car.org/CARResearch
Housingmatters.car.org
THANK YOU!www.car.org/marketdata
[email protected]: CARResearchgroup
Twitter: CARResearchInfo
This presentation can be found on www.car.org/marketdataSpeeches & Presentations