The San Diego Union-Tribune - Wednesday, February 9, 2011
Millennials, those between 18-34, will drive America's housing recovery as prices have generally become more affordable and mortgage rates are still historically low, said Pete Flint, CEO of real estate website Trulia.com on Wednesday.
A recent Trulia survey of 2,000 Americans shows that 26 percent of adults in that age range say their views on homeownership has become more positive in the last six months and almost a quarter say they plan to buy a home by the end of 2012.
"I think they will play a crucial role in the stabilization of today's somewhat uncertain real estate market," said Flint during Trulia's biannual phone conference with the media. The topic was consumer attitudes and trends related to the American Dream.
More affordable home prices and mortgage rates are the likely factors fueling Millennials' interest in homeownership, he added. That's also fueled by their need to find answers quickly, especially online.
"The 18-34 group absolutely wants to be in charge," Flint said. "...Real estate agents are definitely changing their tune, from being perceived as information hoarder to being an adviser."
Flint said that while the American Dream for Millennials and others is still alive, it may not be in their immediate plans.
The survey found that 50 percent of overall respondents don't plan to buy until after 2013, waiting on improvements in the job and housing sectors.
Jonathan Miller, president and CEO of appraisal and consulting firm Miller Samuel, also was present at the phone conference. He reviewed the 2010 housing overview and a 2011 outlook.
Some highlights and insights:
--The homebuyer tax credits that ended in April "artificially stimulated" the economy, leading to an overactive first half and an inordinately sluggish second half in home sales. Miller said that "created a lot of confusion on the consumer side."
--On lending: The good news is, the guidelines aren't getting tighter but that's only because they're already pretty stringent, he said.
--The U.S. homeownership rate, which has historically been 63-66 percent, peaked at 69.2 percent in 2004 and has dropped to 66.6 percent during the last quarter. He expects that rate to decrease "a few more percentage points" this year. Miller said this could be a good sign because the U.S. can "get back to establishing a balance" of homeowners and renters.
--What the U.S. government will ultimately do with Fannie Mae and Freddie Mac will play a crucial role in shaping housing trends in 2011. A report with that decision is expected as early as Friday.
