As is the case at most of these type of functions, there is usually some sort of economic update/forecast. This meeting was no different. Fannie had one of their top guys, Mark Palim, VP for Applied Economics and House Research (try and fit that on a business card), provide his economic insights and some results of recent Fannie research into home buyer trends.
Nothing earth shattering; slow steady economic growth, with some continued growth in the housing markets and a slight increase in long term mortgage rates. For all intents and purposes, the mortgage market in 2015 will be very similar to that in 2014.
One thing I did find very interesting, according to the Fannie study of homebuyers, the drop in first time homebuyers among Millennials is not due so much to the lack of financing options or available loans, or high student loan debt or lack of jobs. It’s that this generation is just not yet ready to buy. They do not lack a drive to attain the American Dream, they just are not quite ready or prepared to pursue it now.
Think about it. This shouldn’t come as any great surprise. This generation takes its time; they stay in school a little longer, live at home a little longer and get married and raise a family at a later age. Those who do not live at home and could afford to buy a home, like the freedom and flexibility of renting rather than buying. They don’t want to make the total commitment to home ownership.
Not surprisingly, regardless of age or status, the highest homeownership rate belongs to those who are married. Makes sense. Once they take the plunge and make that commitment to marriage, it’s time to settle down and lay the foundation for their family; this includes finding a good place to live and raise the children.
So it’s not that the drive to attain the American Dream is waning; it’s just delayed a little. Is that such a bad idea? Rest assured at some point this generation will be ready to buy, seeking quality housing, with quality lending programs provided by quality lenders giving them quality service. You better be ready to meet these needs when they come because another thing about this generation…they are a little less patient and a lot more demanding!