Despite the perils of a shaky market, home ownership long has been recognized as a cherished dream for most Americans. It is disturbing then to discover that most millennials see that dream far removed from the current realities of their day-to-day lives.
Unattainable Goal?
A new study by Apartment List finds that "9 in 10 millennial renters want to purchase a home, but just 4.4 percent plan to do so within the next year." Almost one-third (30.4%) say they have no plans to buy within the next five years.
The study found 48% of millennials have not saved a single dollar for a down payment on a house. Many factors play in to this unpreparedness to purchase a home that do not bode well for a healthy future for America's communities.
A July study by the Urban Institute found that the burden of student loan debt is a huge deterrent to millennial home ownership. "Our study found that a 1 percent increase in education loan debt decreases the likelihood of owning a home by 0.15 percentage points," the report reads. "In other words, if a person’s household student debt increases 100 percent from $50,000 to $100,000, with all other things held the same, the likelihood of owning a home will decrease 15 percentage points."
Apartment List estimates that just 12.1% of college graduates with student loan debt will be able to save for a 20% down payment on a house within the next five years.
Millennials are also marrying less and marrying later. The Urban Institute found that delayed marriage has "the most significant impact on millennial homeownership." It noted that "[t]he marriage rate among young adults dropped from 52 percent in 1990 to 39 percent in 2015."
Less stable jobs, less marriage, and decreasing home ownership...
The Apartment List study states that the lower marriage rate is indicative of the fact that many millennials "simply don’t want to be tied down by homeownership in the near-term." The study found that 34% aren't committed to settling down in the city they are currently living in while 28% want to get married or find a long-term partner first, something millennials are putting off to a later age.
The Urban Institute study also reports that more and more millennials choose to live in expensive urban areas, making affordable home buying even more difficult.
Unstable Society
The picture being painted here is not a pretty one. Young people today are entering adulthood burdened by debt from their college years and armed with a feeling of insecurity about their ability to be a contributing part of stable communities. And who can blame them? Many are stuck in a "gig economy" as full-time jobs with benefits prove harder to find. Being in debt and constantly unsure about one's job standing is reason enough to put off marriage, even though that institution has clear economic benefits that enable one to excel.
We are seeing the rise of a rootless generation of young American adults. Less stable jobs, less marriage, and decreasing home ownership among this age group will only continue to feed the sense of social alienation already felt by too many Americans today.
A National Association of Colleges and Employers 2018 Student Survey Report found that 82.9% percent of college students surveyed said security was the most important job attribute for them. If we want to make our young adults feel they can find their place as part of a larger citizenry, we need to prioritize the American worker over the soulless global marketplace.
America thrives as a nation when its working-age people are actually working. Give our young people solid and stable job opportunities, and home ownership, marriage, and the other ties that bind folks to a community will all fall into place. Treat them like they are disposable widgets in the service of global GDP and the entire social fabric will crumble.
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