Millennials Prioritize Owning a Home Over…

Millennials Prioritize Owning a Home Over…

As a millenial who owns a home and is soon getting married I don’t feel that this article speaks to me entirely, and I think that’s partially because the market that I live in is not exactly as extreme and unpredictable as more populous coastal cities. I have found that even though articles like the one below don’t fully describe my own environment they do point to something. I have many friends who are seemingly holding off bigger life decisions because of financial constraints. With that said, I find it very important to explain that the longer that someone owns a property the more their equity and personal wealth grows (and at an exponential rate). If somebody wants to take control of their own life in my generation one of the best ways would be to own their home. Even if they don’t use me to fulfil that process I recommend they do it. If you are a millenial and feeling a bit stuck it’s time to look at how your life would be different if you bought a reasonable/affordable house and lived in it for the next 5 years – but the longer you own it the better it is financially. OK, have a great day you crazy nuts!


Millennials prioritize owning a home over getting married or having kids

I spend more time than I would like to admit looking at real estate listings online. I recently found a nice townhouse in my neighborhood that costs 25 times my annual salary, which is honestly a better deal than most other places in the surrounding area. The moral of the story is that I’m convinced I’ll never be able to afford a home, at least not anywhere I’d like to live.

According to a new study by Bank of America, I’m not alone in my pessimism. Its annual homebuyer insights report, released on Wednesday, found that 72 percent of millennials, which the report identified as being born between 1978 and 1995, consider being able to own a home a “top priority” — more than traveling (61 percent), getting married (50 percent), or having children (40 percent). Millennials may be killing the housing market, but it’s not because they don’t want homes of their own.

Even if millennials are putting off having kids (which are expensive to raise) and weddings (which are expensive to have) to buy a home, a host of structural factors are getting in their way. High rent prices, student loan debt, and the toll of the 2008 financial crisis are all keeping young people from buying property. Some of these hurdles are purely psychological — naturally, a generation that grew up in the midst of foreclosures and evictions would be scared of buying property — but most are material. Young people spend a lot of money on student loans and rent payments, which keeps them from having money for, well, anything else.

Millennials spend too much money on rent

Generally speaking, young people prefer to live in cities, where both rents and property values are higher, according to a July study by the Urban Institute. The Bank of America report, which polled 2,000 adults who own a home or plan to in the future, also found that 90 percent of first-time buyers would rather find a place in their preferred location, which also drives up prices.

Nearly half the people polled by Bank of America said they spend more than 30 percent of their income on rent, meaning they can be described as being “rent-burdened.” Rent-burdened households have higher eviction rates and are more financially precarious than homeowners or renters who spend a smaller proportion of their income on rent, according to Pew.

It’s not uncommon for people to be rent-burdened in cities like New York or San Francisco, where rent prices outpace wages. This means they have less money left over that can be used for a down payment — and 53 percent of those polled said they’re waiting to buy until they have enough money saved up.

The massive burden of student loan debt

Ten percent of the 2,000 people polled by Bank of America say they have put off buying a home because of their student loan debt. This seems like a relatively small number, but other studies have suggested that student loan debt — especially when coupled with stagnating wages and rising property values — can be an insurmountable burden for young people who want to buy homes.

The average student loan debt in the US is $32,731, according to the Federal Reserve— and the collective student debt carried by all Americans hovers around $1.5 trillion. These high debt levels prevent millennials from purchasing homes, even if they really want to. A 2017 study by the National Association of Realtors (NAR) and American Student Assistance found that student debt delays millennial homeownership for seven years.

According to Lawrence Yun, a chief economist with the NAR, student loan payments prevent people from saving for a down payment or being able to afford a mortgage. “Sales to first-time buyers have been underwhelming for several years now,” he said in a 2017 statement. “Even a large majority of older millennials and those with higher incomes say they’re being forced to delay homeownership because they can’t save for a down payment and don’t feel financially secure enough to buy.”

That said, there’s no real way to win here. A June 2018 study by ApartmentList found that indebted graduates take four years longer to put down a first home payment than those who have no college debt — but those who didn’t finish college take even longer.

Kathy Cummings, the senior vice president of Bank of America’s Homeownership Solutions and Affordable Housing Programs, told me that college grads are generally better off than those without a degree. “Even though you take on the student loan debt, the earnings potential that you have is higher than if you just have a high school diploma,” she said. “The key is really completing that degree.”

The looming threat of another recession

Even if the economy has largely recovered from the 2008 financial crisis, young people haven’t. Materially speaking, the Great Recession widened the wealth gap between millennials and preceding generations, according to a May study by the Federal Reserve Bank of St. Louis. Millennials carry student loan debt, but also car and credit card debts that prevent them from taking on a mortgage — which is a “good” kind of debt that has the potential of appreciating in value.

And psychologically speaking, millennials are still feeling the effects of the Great Recession. One Morgan Stanley analyst told Business Insider that the financial crisis left an entire generation with a “significant psychological scar.” They’re scared of losing their jobs. They’re terrified of the stock market. And this feeling of financial precarity, coupled with a less than ideal financial reality, is keeping young people from buying houses.

“That fear is healthy,” Cummings told me. “That really gets you to the point where you’re making sure that you understand things before you move forward.”

She added that young people often believe “persistent myths” about buying homes, like thinking that they need a 20 percent down payment to have a home.

“There’s a lot of misinformation out on websites that encourage people to put down 20 percent,” she said. “Financially, it is a good practice, but it’s typically not necessary — especially in markets where there are increasing home prices, and there are currently affordable homes, it’s something to consider.”

“If you don’t have 20 percent down, there is absolutely an opportunity to pursue a mortgage,” she added. She also noted that some providers have 3 percent down payment requirements, some people may qualify for down payment assistance programs, and you don’t “need to have a perfect credit score” in order to qualify for a mortgage.

For recession-scarred millennials, though, the idea of buying a house with less-than-perfect credit or a small down payment may not sound like the smartest financial decision. After all, the people who took out subprime mortgages in the years leading up to the 2008 financial crisis were evicted from their homes; the banks that approved those mortgages were ultimately fine. And for those who can’t scrape together enough money for a down payment of any kind — or who are too scared of another financial crisis to take out a mortgage when they don’t have enough money saved up or have a lower credit score — putting off other major milestones is seemingly the answer.

Millennials aren’t intentionally killing homeownership, or marriage, or having kids; they just don’t feel like they can afford it.

Have You Registered Your Storm Shelter?

Have You Registered Your Storm Shelter?

With tornado season approaching central Oklahoma it’s time to make sure that your storm shelter is registered with the municipality in which you live. If you live in Norman like me then you need to visit the link below to make sure that you’ve registered. This has been your friendly reminder that you and your loved ones are worth the few minutes it takes to register.

Register Here

If you are wanting more information about storm shelters I would recommend doing your own research, but here is a little clip to maybe get the ideas swirling a little bit.

4 Ways Investors Can Help Alleviate the Affordable Housing Crisis (& Make Money)

4 Ways Investors Can Help Alleviate the Affordable Housing Crisis (& Make Money)

As the world increasingly migrates into urban areas housing prices for most people have increased a significant amount. It’s nice to hear that there are people trying to plan ahead so that we can alleviate some of these financial pressures. This isn’t to say that these things are being figure out quickly enough, but I am encouraged that creative capital is being spent in this way. Have you heard any stories of people coming up with ideas like those listed below? If so I’d love to hear about them.



4 Ways Investors Can Help Alleviate the Affordable Housing Crisis (& Make Money)

Unless you live under a rock, you know all too well that there is an affordable housing crisis underway. And indications are that it is going to get worse before it gets better. I recently ran across some stats that paint a pretty dismal picture. One study estimates we’ll need an additional 4.6 million new apartment households by 2030. This equates to 325,000 new apartments needed annually to keep up with demand. Unfortunately, the number of new apartments projected to come online is about 70% of what is needed. Add to that an already low supply of affordable units and minimal government incentives, and we’ve got an ever-widening affordability gap.

However, as is often the case, where there are challenges, there are also opportunities. The affordable housing shortage presents not only opportunities for good investments, but also the opportunity to make an impact (that is, investments that will make you money and do good socially and environmentally).

If you have a genuine concern about the affordable housing crisis and want to be a part of the solution, read on. Here are four ideas on ways real estate investors can help alleviate the affordable housing crisis—and make money in the process.

4 Ways Investors Can Help Alleviate the Affordable Housing Crisis

1. Crowdfunding

Real estate crowdfunding is relatively new but gaining in popularity. Most readers of this article are likely to think of direct investment when it comes to real estate—buying a property ourselves to do a fix and flip or long-term rental, or investing in a specific project via private money loans.

But most of us are limited in the number of projects we can invest in at any one time. Crowdfunding expands the reach of individual investors and opens real estate investing to a much broader range of individuals. Some platforms have minimum investments as low as five dollars. With crowdfunding, the investor can often specifically invest in projects that will bring more affordable housing online. So, even though you may not have the funds to fix and flip a new affordable housing project on your own, with crowdfunding you can be one of several investors who help get the project off the ground.

Also, unlike direct investment that involves owning and managing property (and all the headaches that come with), crowdfunding is passive so you put your money to work without the stress and sweat equity that comes with owning property.

Related: Why I’m Investing in Affordable Housing for the Long Haul

2. Investing in Homeownership

Another take on crowdfunding, these funds are made up of pools of distressed mortgages. These funds use investor money to purchase pools of distressed mortgages and then work with homeowners to find solutions that will keep them in their homes.

When you invest, you are helping not only individual homeowners but also the community by positively impacting affordable housing in the neighborhood. You make money by receiving returns from the profits.

3. Tax Reform and the Opportunity Zones Program

You’ve probably heard about Opportunity Zones, but just in case you aren’t up to speed on this program, here is a quick overview. Opportunity Zones are a new economic and community development program established by Congress in the Tax Cut and Jobs Act of 2017. The purpose is to encourage long-term economic development and housing investments in low-income communities nationwide.

The law provides for the creation of “Opportunity Zones,” which use tax incentives to attract long-term investment to neighborhoods that are continuing to grapple with high poverty and lackluster job and business growth. Housing experts and government officials believe investment in Opportunity Zones will help prompt development of affordable housing.

Related: How the Dire Future of the Retail Market Could Solve the Housing Affordability Crisis

Projects in Opportunity Zones will be eligible for funding through Opportunity Funds. Opportunity Funds are investment vehicles set up specifically for investing in eligible property located in an Opportunity Zone. Opportunity Funds require that the investor use the gain from a prior investment for funding the Opportunity Fund.

Opportunity Funds create benefits for both investor and community. Investors who are socially conscious can put their money into the communities that need it most. Investors also benefit from tax advantages. Opportunity Funds allow investors to defer federal taxes on any recent capital gains until December 31, 2026, reduce that tax payment by up to 15%, and pay as little as zero taxes on potential profits from an Opportunity Fund if the investment is held for 10 years.

You can invest in an Opportunity Zone anywhere in the country, but if you are interested in keeping it local, you can find Opportunity Zones in your area by going to Opportunity Zones Resources and in the Federal Register at IRB Notice 2018-48. In Minnesota, where I live, 128 Census Tracts have been designated as Opportunity Zones.

4. Affordable Housing via Fix and Flips and Long-Term Rentals

There are direct opportunities for real estate agents, investors, and builders to be more socially conscious and to have a positive impact on affordable housing through regular business dealings. With a little forethought and planning, a lot can be done to help reduce expenses when building and rehabbing homes. Homes can be made more energy efficient, safer, and designed to incur less tax. All of these can benefit potential homeowners and make housing more affordable to more people.

“You Are A Big Deal” -Kent Carter

“You Are A Big Deal” -Kent Carter

My father is a wonderful speaker and writer. I love hearing his stories and his thoughts on his life. He isn’t afraid of a big fish story here or there, but I sure love hearing his stories no matter their veracity. I particularly liked this post, and I thought it was worth sharing. I hope you enjoy it too.

*Oh by the way – if you’re looking to get a home loan or refinance your house he should be your man. He was the president of the Oklahoma Mortgage Bankers Association, and he’s the salt of the earth. Anywho, i hope you enjoy his thoughtfulness. Kent Carter, First Capital Mortgage (405)361-2902


New Listing Alert: Under $200k in West Norman!!!

New Listing Alert: Under $200k in West Norman!!!

3824 Cord Circle Is Move In Ready, and Right Next To Brookhaven Village In West Norman!

Location, layout, condition, schools – this house checks off so many boxes! Located an actual stone’s throw away from the Brookhaven Village shopping center, and designed for simple / clean living this home has a great feel for someone hoping to simplify their life. The hardwood floors throughout the house, and the open and split floor plan provide a wonderful aesthetic for entertaining and basic daily living. If you’re planning out your new year maybe consider making this beautiful home a part of that plan!

New West Norman Listing!

In this area, and this condition it is tough to find a deal like this! Metro Brokers of OK

Posted by Grady Carter - Home Boy Real Estate on Wednesday, December 26, 2018

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$5,000 Flooring Allowance by Campus in Norman

$5,000 Flooring Allowance by Campus in Norman

What Kind of Flooring Would You Put In?

Even though this beautiful home has just had 1,100 feet of wood flooring redone downstairs the owner wants to offer a $5,000 flooring allowance towards a next owners preference for other flooring in bedrooms and other living spaces. Which kind of flooring would you go with?

Walk Through Tour - 2816 Majesty

https://goo.gl/AYNxNdNew Listing Alert!!! Looking for houses in the heart of Norman can be a tough task. But don't worry, we've got another great house in McKinley School District, just a short walk away from Campus. The layout, and location will make this home something to talk about. Since it sits at the end of a cul-de-sac the backyard is really a delightful surprise for being so big in down. Come in and take a look online, and/or call today to set up a private viewing.Grady CarterMetro Brokers of OK(405)474-2905HomeBoyOK.comhttps://goo.gl/AYNxNd

Posted by Grady Carter - Home Boy Real Estate on Friday, June 29, 2018

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