Uncertainty always exist. It just takes events like Brexit to see them.
Unfortunately, big events, in an age of social media and a larger shared community, are happening more often. And they each have the potential to impact what is one of the US’ biggest economic drivers - housing. It underscores the old adage that the only person you can control is yourself. Never has that been more true than today.
The average home stays on the market for about 75 days before a sales contract. If you sell real estate, wouldn’t it be nice to consistently beat that average? And to have more buyers bidding your sale prices up?
Of course. The real question is where do you find these new buyers?
Well, a lot of them are sitting on the sidelines wishing for a home but leery of what they saw (or experienced firsthand) in the housing market collapse of 2007. A good number of them have down payments in hand – either in their savings accounts or starter home equity – but they’re loath to risk their hard-earned nest eggs.
Economists have spelled out the solution for decades: Buyers simply need the same level of protection everyone else in the transaction enjoys. Specifically, they need down payment protection.
Now it's here...
I turned 40 last year. I remember it was not too long ago when the subject of Generation X was a gravitational force in the media, in academics and even in public policies. In the last decade – as an avid consumer of pop culture and an athlete who competes physically with younger people – I have learned our new generational obsession is now the Millennials. I understand Millennials are the largest demographic population in the history of America – 92 millions strong compared to Babyboomers’ 77 millions – and I heard they are do-gooders, more globally aware, and friendlier to the environment. All sounds terrific.
But as I dig deeper as a marketer, the news was not all rosy with Millennials. And this includes the American Dream.
Hint: it's affordability and risk
Andrea Riquier wrote in the MarketWatch article Why first-time home buyers are staying on the sidelines that the missing-link into housing growth is first-time homebuyers and the primary reason for this miss is home prices. While that is certainly true, what is not so transparent but is eluded to are the human, emotional elements at play here.
Our historic-low interest rates just inched up a bit, creating big headlines.
Specifically, the Fed just raised its benchmark interest rate by .25 percent for the first time since 2006. This morning, prospective homebuyers find themselves ruminating over a lot of what-ifs.
Not to worry. The rate hike isn’t that big a deal.
As I get older, I am learning to respect a lot of those old adages I used to hear growing up. One in particular struck me this morning - "the more things change, the more they stay the same." Look at 1965 as an example. 50 years ago we were mired in a complicated war, racial tensions were brewing and the Rolling Stones were on tour. Sounds like 2015 doesn’t it? But the similarity doesn’t end there. Homeownership levels are also the same - and not in a good way.
In the CNN Money report "4 reasons 2016 is the year to buy a home" we learned that all cash purchase transactions declined significantly in the Q3 as reported by CNN commentator Kathryn Vasel. The simple response to this data point is more affordable homes are becoming available to first time buyers.
A different point of view, however, is ...
