New Household Formation Will Fuel Housing Demand
This is a great article from my latest newsletter. Source: Buffini & Co.
Stemming from the most basic human need for shelter, the real estate industry is fundamentally built to last. The state of the housing market is impacted by many factors including mortgage interest rates and the volatility of other investment options. However, it is the limited supply along with the growing population that drives the need for housing.
The next surge in demand will be stimulated when Echo Boomers join the Baby Boom generation as active participants in the housing industry, reinvigorating the real estate market with opportunity and validating the purchase of a home as a lucrative investment.
In real estate, it’s not enough to keep your eye on the ball; you have to anticipate where the ball is heading. Demographics dictate that the U.S. population will continue to rise, creating new households and a greater need for housing. According to the Joint Center for Housing Studies at Harvard University, population trends will restore vitality to the housing market as the nation emerges from the current recession.
The chief reason is the presence of the millions of Echo Boomers. Together with immigration to the United States, Echo Boomers are expected to raise housing demand for the next decade and beyond.
Who Are the Echo Boomers?
The Echo Boom generation, also known as Generation Y or the Millennial Generation, are the children of the Baby Boomers. Now the nation’s largest demographic group, Echo Boomers are entering the peak years for forming their own households.
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