I have written many times here about my initial foray into real estate investing. In my three part series Working Millennials: Rent or Buy Real Estate? (read Part I, Part II and Part III), I encouraged young people to “buy a multi-family type property. It can be a two-family, four-family, you can live in the basement of a brownstone. It doesn’t matter as long as you get in the game. You will unlock the creativity I know you possess. You will beat inertia—a most horrible foe.”
I want young people to become owners. Ownership is key to the idea of becoming a long-term investor. But of course that’s not easy for everyone. CNBC reports today that home ownership rates have dropped to their lowest levels since 1965, and it’s because Millennials aren’t buying. Diana Olick writes at CNBC:
After rising just over a decade ago to its highest level ever, the nation’s homeownership rate fell to match its all-time low and could drop even further in the months to come.
In the second quarter of this year, the rate fell to 62.9 percent, not seasonally adjusted, which is the same as it was in 1965, when the U.S. Census started tracking the metric. During the epic housing boom in the mid-2000s, the rate soared as high as 69.2 percent. That was when politicians touted the so-called “ownership society.”
The drop in homeownership is largely due to a delay in homebuying by the millennials, who have the lowest ownership rate of their age group in history.
Many Millennials are burdened by the weight of massive student loans, and have faced a job market that has been particularly harsh on entry-level job seekers for the last 8 years or so. But if you can work hard now you can take advantage of one of the best rental markets in decades. According to Zillow in 15 major markets, “rents among the cheapest apartments are outpacing the growth of the entire rental market.” So hustle, get creative and get in the game.
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