They really break down the today's real estate and who is purchasing and renting it.
"When looking at the dynamics of the single-family housing market, we also consider the potentially shifting trends of homeownership in the U.S. since the financial crisis. At about 64%, homeownership in the U.S. is among the highest in the developed world. While owning your own property has historically been associated with economic prosperity and the American dream, renting needn't only be the preserve of those economically locked out of homeownership. Many U.S. millennials (born 1980-96) have a different view of homeownership to their parents' generation. Millennials witnessed the price falls of the financial crisis, and may therefore be more comfortable with the idea of renting and the flexibility it offers. Throughout the financial crisis and the recovery to date, the number of owner-occupied households has remained stable, while rental households have increased by 8 million"
So basically potential buyers (renters) are being more cautious in buying a home and creating debt. You have a lot of investors that like to lease real estate and create a nice living area for tenants. Owner occupied homes are the same and there is still a lot of new buyers coming into the market, because of their need for a home and not wanting to lease. They also usually have better financials and put down a lot more money or just pay cash.
"In 2016 there were 1.3 million "household formations" in the U.S. — 25% above the long-term average. In a recent research note, Morgan Stanley (MS) said it expects this trend to continue for at least the next five years driven by long-term demographic trends. Household debt-to-GDP has fallen significantly since the financial crisis, with consumers reducing both secured and unsecured debt. U.S. economic indicators are strong, measures of housing affordability are more favorable to consumers than they have been for some time and demand for housing currently outstrips supply"
Debt was the key to the downfall in in housing and that has been corrected. Household debt has dropped and so have the bad mortgages. The key to a stable housing market is the liquidity in mortgages that are sound and have sizable down payments. Investors that purchase the mortgage notes have to be confident that their investment is sound.
In my experience with buyers since 2016 they are way more conservative on their debt and pay cash or put down sizable down payments on their home purchases. IRA's are also being used to pay for real estate. Private mortgage money is more readily available.
Overall the real estate market looks sound and should be on a firm foundation in years to come.
If your wanting a place to live or create income let's have coffee and discuss your options. I'm Brett and I would love to have your business. Call 216-703-5740 EXP Realty Ohio and 602-363-6551 EXP Realty Arizona
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Thank you