With the Federal Reserve raising interest rates again last week, Congress is struggling to come up with a remedy, and the Biden administration has failed to address a dire housing shortage, the effects of today’s housing market on millennia and Others can shape young people’s finances for years.
“Young people have been offended,” said Antonio Arellano of NextGen America, a liberal youth-vote organizer that targets voters between 18 and 35. Tough people who are already buried under student loans. And the cost of housing “is a significant turnout motivator for the young voters we’re talking to.”
Median house prices hit another record high in June. Pending home sales fell 8.6 percent They were down 20 percent from May and compared to June 2021, the National Association of Realtors said last week. And the average monthly mortgage payment is 76 percent higher than a year ago.
Washington is taking notice: Congress last month held three hearings addressing housing affordability in one week alone, and the Biden administration last week used federal COVID relief funds to boost the supply of affordable housing to state and local governments. Offered more flexibility to use. But there is no reason for optimism among the millennials who are now feeling the shortage.
Housing organizer Tara Raghuveer said, “Supply-side intervention, even if it is successful, does nothing to ease that pain and does nothing to ease the pain of the American people before November. ”
Raghuveer, 30, said he has encountered a “sense of loss” among young people in his work as director of both People’s Action in Kansas City and the National Homes Guarantee Campaign for KC Tenants.
A Biden administration official said the White House was doing everything possible to bridge the shortfall, but said it was up to lawmakers to fund major reforms in housing stocks.
While millennial homeownership rates and wealth have increased over the past two years, they still lag far behind older generations. Those born after 1980 accounted for just 6.7 percent of household wealth as of the first quarter of 2022, According to Federal Reserve dataEven though adults between the ages of 18 and 42 make up about a third of the US population.
At the root of the problem is a severely insufficient supply of housing to meet demand, which is a shortage of specialists. Estimated 3.8 million homes, And because there’s no quick fix — Biden’s plan to build and preserve only 100,000 affordable homes is expected to take two more years — the situation isn’t likely to improve anytime soon, which will spell trouble for existing ones in November. There may be heaps.
Sixty-four percent of adults aged 30 to 49 disapprove of Biden’s job performance, while just 35 percent approve, according to pew, almost The reverse was true in April 2021Nearing the 100 day mark of his presidency.
Pollsters say no single development has turned these voters sour on Biden, but they note that young people are well aware of the economic hurdles facing their age group.
“This generation recognizes that being independent is more challenging to launch than any previous generation,” said John Della Volpe, director of voting at the Harvard Kennedy School Institute of Politics. He pointed to “housing costs, rising material costs and student loans” as widely held concerns.
According to Pew, one in four Americans between the ages of 25 and 34 today live in a multi-generational household. This is up from 9 percent in 1971.
Those who manage to move out of the house are increasingly renting out as home ownership – the most common way Americans make wealth – becomes out of reach.
According to Pew, 88 percent of adults aged 30 to 49 and 85 percent of those 18 to 29 rated the economy negatively.
Raghuveer said, “I have seen youth mourning the future they were promised, that they now know is not guaranteed, but it is not coming.”
Raghuvir, who held tenants meetings with lawmakers and Biden administration officials in Washington last month, said his main request is to get Biden to treat housing affordability with more urgency.
“We need the president to talk about rent to the same extent as he is talking about gas,” she said. “We need the entire administration to leave no stone-left-handed to regulate fares – and regulate rents today, not just in five years. The same way the administration is fully prepared on gas prices , we need it.”
Young people are doubting the ability of the government, he said, and “if we don’t see that kind of leadership, that doubt just fades away.”
More than 76 million adults in the US are between the ages of 26 and 42, according to census bureau data, making Millennials the largest segment of the population. The median age of first-time home buyers, who typically make up about 40 percent of the market, is 35, according to Zillow.
“The biggest generation in history is coming to the market without enough homes,” said Zillow economist Nicole Bachaud. “People are being taken out of the market, especially first-time buyers who don’t have that equity from owning a home.”
“First-time purchases must be booming,” said Lawrence Yun, chief economist for the National Association of Realtors. “The reality is just the opposite – Millennials are facing tremendous challenges,” he said. “Typical first time buyer activity should be closer to 40 per cent. Today it is essentially trending at 30 per cent, a few months below that.”
young people too Looking at their rent bills — the highest monthly expense for most homes — get dramatically larger when they renew their leases. The average national fare has increased by 14 percent over the previous year, according to apartment list,
“Sky skyrocketing rents and a lack of homes for sale have pushed home ownership out of reach for millions more families — especially tiny homes and people of color,” the Senate Banking Chair said. Sherrod Brown (D-Ohio). “If we don’t address the high cost of housing, we could close up and exacerbate the housing and wealth inequalities we have.”
added delegate Patrick McHenry Top Republican on the House Financial Services Committee of North Carolina: “The only way to make housing more affordable is to increase supply. It starts with reforming state and local regulations that hinder new housing development.”
Biden administration released a plan in May To boost supply, partly by rewarding state and local jurisdictions that overhaul exclusionary zoning rules. The White House in September committed to building or preserving 100,000 affordable homes over three years.
Volp said the movement at the residence could help Biden stand up to young voters.
“I don’t think that’s why it’s where it is, but it could be a way to address the specific ways in which the economy is uniquely affecting young people – the need for affordable housing.” Shortage, student loans, inflation,” he said.
The Biden administration official said that since affordable housing is a problem in every congressional district, US lawmakers should focus sharply on it because the administrative tools are not enough.
There are more than a dozen bills running in Congress aimed at making housing more plentiful or affordable. $1.75 trillion The reconciliation bill passed by the House last time included billions of dollars to build and rehabilitate affordable homes, but those programs are not expected to create a final package that the Senate could approve.
House Democratic appropriators approved a funding bill for the Department of Housing and Urban Development in July that includes funding for 140,000 additional rental assistance vouchers and a program to help first-time, first-generation buyers buy homes. Is.
Still, Yoon said: “Any increase in available inventory in the first half of this year has been offset by a corresponding increase in consumer costs.”