{"id":5063,"date":"2024-04-03T18:49:27","date_gmt":"2024-04-03T18:49:27","guid":{"rendered":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/2024\/04\/03\/a-crisis-of-young-american-men-will-cause-house-prices-to-correct-by-20-this-famous-analyst-says\/"},"modified":"2024-04-03T18:49:27","modified_gmt":"2024-04-03T18:49:27","slug":"a-crisis-of-young-american-men-will-cause-house-prices-to-correct-by-20-this-famous-analyst-says","status":"publish","type":"post","link":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/2024\/04\/03\/a-crisis-of-young-american-men-will-cause-house-prices-to-correct-by-20-this-famous-analyst-says\/","title":{"rendered":"A Crisis of Young American Men Will Cause House Prices To Correct by 20%, This Famous Analyst Says"},"content":{"rendered":"

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One surprise coming out of the Fed rate hike campaign is that house prices have been hardly impacted at all. Prices surged when COVID took so much inventory off the market, but even as the country and the housing market normalized and mortgage rates went as high as 8%, growth returned to around 5% to 6% per year\u2014without any correction.<\/p>\n

Meredith Whitney, known for her prescient calls as a bank-sector analyst, expects that to change. Whitney is best known for predicting Citigroup would have to raise capital, sell assets or cut its dividend on Oct. 31, 2007. Then CEO Chuck Prince quit two days later, and Citi ended up doing all three. (Her subsequent call of widespread municipal bond defaults\u00a0missed the mark<\/a>.)<\/p>\n

She is out with a new research paper, called \u201cThe crisis of the young American male and the long-term impact on housing demand,\u201d and she appeared on CNBC and\u00a0The Julia La Roche Show<\/a>\u00a0to promote her demographic-focused prediction.\u00a0Whitney told CNBC<\/a>\u00a0that the clearing price of homes will be some 20% lower than it is today.<\/p>\n

Though Whitney isn\u2019t saying the house-price decline will come all at once, it is worth noting that other professional forecasters<\/a>\u00a0eye price growth of roughly 1% to 3% this year, and then a price change ranging from a decline of 1% to a gain of 2.5% in 2025.<\/p>\n

The first element to Whitney\u2019s call is that the U.S. housing is owned by older people\u201490% of whom are over 40 years old, and 74% owned by people over 50. As the baby boomers age, they will downsize\u2014some 45 million homes that will come on the market, she estimates. That\u2019s huge supply given that the peak number of existing-home transactions was 7 million, and that the current rate of sales is just over 4 million. \u201cYou have a supply glut that is inevitably going to hit the market,\u201d she said.<\/p>\n

Now here\u2019s where the young male element of her call comes in. What she calls the \u201cavocado toast\u201d generation\u2014younger millennials plus Generation Z\u2014aren\u2019t buying homes at the same rate, and there\u2019s also the highest percentage of single men on record. (Women are less likely to live at home.) One out of five young men live at home with their parents, she said.<\/p>\n

Not everyone is as fearful about the supply impact from the elderly\u2014government-owned mortgage buyer Freddie Mac for instance estimates 9.2 million fewer Boomer homeowner households by 2035<\/a>.<\/p>\n

And missing from Whitney\u2019s analysis is the recent impact of a surge in immigration. The Congressional Budget Office estimated that net immigration was 2.6 million in 2022 and 3.3 million in 2023, far higher than the 900,000 average between 2010 and 2019. While the CBO expects that growth to cool, immigration could help limit the impact of both seniors selling and young men living at home.<\/p>\n

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The post A Crisis of Young American Men Will Cause House Prices To Correct by 20%, This Famous Analyst Says<\/a> appeared first on Real Estate News & Insights | realtor.com\u00ae<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"

Getty Images One surprise coming out of the Fed rate hike campaign is that house prices have been hardly impacted at all. Prices surged when COVID took so much inventory off the market, but even as the country and the housing market normalized and mortgage rates went as high as 8%, growth returned to around…Read More→<\/a><\/p>\n","protected":false},"author":0,"featured_media":5064,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-5063","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"_links":{"self":[{"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/posts\/5063","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/comments?post=5063"}],"version-history":[{"count":0,"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/posts\/5063\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/media\/5064"}],"wp:attachment":[{"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/media?parent=5063"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/categories?post=5063"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/billingsrealtybrokers.paradiseinnovations.com\/index.php\/wp-json\/wp\/v2\/tags?post=5063"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}