re: Why are homeownership rates precipitously declining?

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Stop buying suburb houses, people! Those things don't appreciate and not as much of the value is in the LAND! Buy a small old house in the city in a desirable area with a 15 year loan, hold it a few years, do a few repairs, or nothing, and then sell it for a profit and buy a nicer, more desirable place and repeat.

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In what major city is this possible? Considering also that people want to live in a safe area, and want to have a large enough house to be able to have a family in, while being able to send their kids to school?

I mean, what you are saying is 100 percent correct about land appreciation... but you still have to live it the house in the meantime, and you still have to be able to afford to get in.

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In what major city is this possible? Considering also that people want to live in a safe area, and want to have a large enough house to be able to have a family in, while being able to send their kids to school?

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In Austin. The public schools in the central part of the city are excellent and there's no crime. But, define "large enough house". For most of the 20th century 1,600 SF 3/2 was plenty to raise a family in. Today, millinials are aghast if you suggest that they inhabit less than 3,200 SF.

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Most millenials view home ownership as them being anchored to a city. In this economy it helps being able to move around free from worrying about selling your house.

Also renting means you don't need to know how to fix things around the house/apartment

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Interesting point. There's definitely truth to that.

But housing prices in many cities is absurd. The average home price in Denver is $350k. In Boulder, it's $525k.

People in their thirties and younger want to live in fun cities with a good nightlife, not the suburbs. That's one thing that'll keep in from permanently settling in Colorado.

I was going to buy a house in Nola. But as soon as a house was put on the market, it was under contract within hours. Companies were buying houses with the intent of making them air bnb properties. And I'm not just talking about Bywater. It was all over the city.

Unless salaries catch up with housing prices, the home ownership rates will continue to decline.

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Other than equity, homes and their value gets passed down from homeowner to their kids.

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Home ownership is not the only vehicle for accumulating wealth. I just don't get why people think it's a "crisis" that fewer people own homes.

People just aren't doing it right.. I've lived in my current house for 12 years.. It's paid off.. My options are pretty open. Maintenance is minimal b/c i'm not completely helpless and can do some shite. Taxes and Insurance are not overly hard to pay for. If I wanted to buy a new place I have a big ole down payment. A Job offer in another city just move and keep the house and collect rent.. I've always seen rent as a temporary solution and certainly nothing permanent.. guess its just me though

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In Austin. The public schools in the central part of the city are excellent and there's no crime.

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Big selling point to move from NO to here.

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But, define "large enough house". For most of the 20th century 1,600 SF 3/2 was plenty to raise a family in.

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This was the size of our house in NO. It was Uptown but off the beaten path, so we were able to buy it for 325k. I think we came out about even selling it since we had to bail to move here after only 2 years. But that is a lot of money to have before the age of 30, if you aren't putting 5% down of course.

We have an agreement in place on a house in NW Hills. It doesn't seem quite like the "suburbs" and I'm hoping the fact that the uniqueness of that area with the views make up for the proximity when it comes to values. They can't build every where up there due to the topography.

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Those cheap house suburbs tend to drop off hard once they get a few years old too, which makes buying there a big risk.

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I'd be terrified to buy in a neighborhood like that. You see it all the time. It's great until the next best thing pops up .5 mile down the road.

If you look at those neighborhoods long term, many of those homes will consistently sell at essentially the same price over time, rising up and down. Which isn't always a bad thing considering the alternative is cratering.

Tons of those around Houston. "Oh this is a great suburban area with affordable housing!" Ten years later the place is a dump.

Also coming from a millennial that manages my money closely, I've done the math over and over again on buying a house. It is worth some savings compared to renting when you factor in tax benefits, appreciation, etc. However it is also a big risk. You essentially have to buy on the hopes the market goes up significantly and you can sell out at the right time. In the interim you are still paying interest, property taxes, homeowners insurance, and cover maintenance. If you have a major issue that isn't covered by insurance (for one reason or another), or the market moves against you, or you need to sell at a bad time (job transfer, layoff, etc) then you can take a big hit.

Renting right now is the safer option and isn't noticably more expensive. The wife in will probably buy soon when we are certain we have found the right house, but it isn't some kind of grand slam the way it used to be.

Yes, exactly. This is why that guy talking about how much he has made owning houses in Austin is ridiculous. Austin has been one of the hottest cities in the U.S. for the last 5-10 years. No shite the housing market has been on a huge uptick.

That isn't the case everywhere. Further when/if Austin cools down that you could be fricked if you bought into a massive bubble.

The idea that all (or pretty much all) land infinitely appreciates is ridiculous. You can see it happening some of the old Flavor of the Month suburbs.