2010 To 2020 - Top Housing Purchase Pick Ideas
By: Blake Dale Ratcliff
We face some conflicting facts considering home purchases today. In particular, if you are a long term buyer, you really need to make a great choice the first time. What defines the best purchase opportunities right now? This question is a much more difficult issue now than in the past. At the top of the list for issues to consider are:
- The echo boomers are exiting their baby boomer parents homes going to college and entering the workforce. This plus the high volume of immigrants over the past two decades is creating a wave of demand for rentals.
- The aging of the boomers adds to the wave of demand.
- At the same time, boomers who own homes and now have no children at home are faced with the question of what to do with the real estate they have. Market conditions certainly don't favor selling. Renting the space must be at the top of the list. The likelihood is that this will place downward pressure the market because of the substitution effect. In effect, even as the number of households increases the number of new homes could be significantly suppressed.
- The boomer children seem to be on track to have even smaller families resulting in more limited housing demand.
- Rising tax and interest rate pressure may dampen new construction and cause still further pressure to downsize housing needs.
- Loss of confidence in housing as a wealth repository, losses from the recession, increased credit requirements for home purchases, and increased downpayment requirements will turn many buyers to renters. Because of this, renting as a home may be the new norm.
- Slowing population growth will slowly dampen further need for new housing and new infrastructure.
With this in mind, what are some of the highest quality purchases available?
- Structures offering timeless architecture and great lifestyle features such as easy mass transportation access, access to employment, walking shopping, etc.
- Homes that today are considered single family that could support multiple renters reasonably. In short, housing whose value can be multiplied with minor changes.
- Houses that are highly efficient for living - low utility cost, easy maintainability, etc.
- Locations whose combination of access, opportunity, and quality of living will lead to "use upgrades" as the economy evolves.
- Properties that avoid the idea of development coming to the property.
Of course, the best opportunities those that combine all or a part of these ideas in a single structure are the likely biggest winners. Specifically, in this environment urban and "semi-urban" housing will be a likely long term winner with strong probability of multiplying value.