One expert answered the question “There’s not enough income to allow (younger) people to get into housing”
One of the biggest reasons that young Americans are waiting to buy their first home is student debt. Millennials, in what used to be considered the prime home-buying age, are carrying an estimated $1 trillion in student loan, according to the U.S government.
Zillow predicts that Millennials will eventually be in a financial position to buy, but home ownership is still in the hazy area of “later.” At the same time, Zillow says, renting will become more affordable as incomes rise and growth in rents slows.
Why Younger Potential Buyer Spend Rather than Invest
They are also concerned with the drop in home values that occurred in 2008 – 2011. So they’re spending, rather than investing, on “right now” lifestyle items like buying nice cars, going out to dinner, and moving around a lot with jobs.
However, even with student loans and a taste for high life, they could take a look at the benefits of home ownership – prime amongst which is the interest tax deduction. Yes, $1,100 a month for an apartment may be less than a home loan, BUT – there are NO tax benefits and no long-term opportunity for profit.
EVERYBODY needs someplace to live. Apartments have more than a few drawbacks – in addition to the fact that money spent on them is gone forever – including crowding, the potential for 6 bad neighbors (above, below, all four sides) and the lack of “cool” that home ownership provides.
Many worriers are suggesting that the dream of home ownership that propels the American economy even now is fading. But, if everybody rents, and doesn’t buy, who will pay for roads, schools, more amenities in communities?
Prediction: Millennials who invest in a home will have a more comfortable, happier and less stressful life than those who don’t. They’ll live better and longer and have more fulfillment.