The recent National Association of Realtors report indicates that the percentage of first-time home buyers has dropped significantly in October to 28% falling from 29% in September 2022. Typically, first-time home buyers comprise 40% of all existing sales. The reason for the squeeze in this particular niche has a lot to do with the escalating mortgage rates, the inventory shortage and high student debt.
In 2021, 25% of U.S. adults between the ages of 25 and 34 resided in a multi-generational family household, which represents an increase from what had been the case in 1971. Students for the past 50 years have remained at home for longer and longer periods of time, 31% of high school students remained at home after graduating, whereas only 16% of students obtaining a bachelor’s degree stayed at home in 2021.
According to the Pew study financial issues represented the major obstacle causing the 25-to-34-year-old demographic to remain at home. The capacity to earn a higher salary due to the lack of a college education seems to be one of the biggest setbacks to moving out of the house. This is not a recent trend, but it began back in the Great Recession of 2008, when young adults who had completed even their bachelor’s degree found that housing was too expensive to take on.
The 25-to-30-year-old population living in a multigenerational home typically had a parent living in the house. According to the Pew study 47% of those who lived in multi-generational homes had two parents living in the house. In 2021 57% of 25-to-34-year-olds who had a bachelor’s degree we’re living at home. According to the Pew study, the median household income for a home with two parents was approximately $113,000 in 2021. This compares with a household income of $75,000 for those in the 25-to-34 age range with just one parent. The typical 25-to-34-year-old in a multi-generational household contributed 22% of the household total income in 2021.
If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.
Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single-family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.
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