Millennials Finally Moving Out of the Family Basement
Fannie Mae says Millennials are finally leaving their parents’ basements
Parents, maybe your offspring may finally be moving out of the family’s basement.
A new report(PDF) from Fannie Mae, the U.S. government-backed mortgage company, suggests that the millennial generation is finally getting a “move on” in their lives.
“According to the ACS [Census Bureau’s American Community Survey], the number of homeowners aged 25-34 fell by more than 250,000 in each year between 2007 and 2012, but has declined by less than 100,000 annually since then,” Fannie Mae said. “In fact, the decline between 2013 and 2014 was statistically insignificant, the first indication of stability in the number of young homeowners since the onset of the Great Recession.” This means that data shows the number of Millennials who have been residing with parents has leveled off and may even be turning around in a decline.
Fannie Mae said data supports the idea that it won’t take much to see positive growth in millennial homeownership in the near future.
A report published by Goldman Sachs earlier this year also pointed to millennials’ desire to leave the family homestead. The company’s survey showed that only 12 percent of millennials rated home ownership as “not very important,” while 20 percent already owned a home or were in the process of buying one. Almost 70 percent said ownership was either “very important” or “important,” but it wasn’t a near-term goal.
Indications are for a brisk housing market in 2016. This data coupled with the recent announcement of the first rise in interest rates by the Fed since it placed the floor rate a zero seven years ago. This should also bring many Millennials off the sidelines into the home buying mode in anticipation of further rises in the future and the fear of “missing out”.