Owning A Home 10 Years From Now

I was surfing through CNN toward the end of the week when I noticed an interesting piece on a potential housing boom that speculators see coming to fruition around 10 years from now. The cause of this boom, they speculate, are Millennials. The idea behind this story is that due to the fact that we Millennials have been cooped up in our apartments, or parent’s basements – that we will in the next 10 years – bust out, and say “Enough is enough!”

It also goes on to point out that there are a series of economic and workforce integration statistics that support this looming boom. In addition to us being sick of living at home – we’re also integrating ourselves into the workplace quite nicely – and finally – are getting into a position that staving off mountains of student debt is actually possible. (You can read that entire article here)

While reading this article is pleasant – and even gives me a glimmer of hope for the future, or for any generation including my own going forward – it hardly should be taken as anything but really, really, really, great speculation. It’s a little hopeful, too. There are so many things that can happen between now, and then – for individuals – and this country as a whole that it still might be insane to assume that we’re headed for this beautiful 1960’s style Utopia where home ownership is not only possible, but common.

The truth is that the economy has a long way to go. Students are still graduating with fewer jobs to pay for the thousands of dollars in debt they accrue while obtaining that higher education. The cost of education is continuing to increase, and loans aren’t getting the job done. That means students are using credit. In fact, research has shown that the average college student will graduate with over 4 credit cards, over $4,000 in credit card debt, and 84% of undergrads will have at least one credit card to their name. The same research shows that 90% of those students with open credit – utilized it for direct educational expenses.

Debt factor though isn’t the only factor figuring into this mess. Millennials consistently struggle with commitment. Predominantly we think about commitment as our ties to another person – but it goes well beyond that. An individual who is either unwilling, or unable to commit to another person for more than a weekend, or night – certainly isn’t ready to commit to a 15-30 year mortgage.

And yes, while the national employment picture continues to improve – it shouldn’t be marveled at that Millennials are finding jobs. As non-Millennials leave the workforce, it can be assumed that someone – probably a Millennial – will replace them. That’s just basic logic.

The problem is that they’re often replaced at far lesser compensation packages, which don’t include a pension. Many Millennials won’t even know what a pension is, because they will have worked their entire life – to never have been offered one as part of a compensation package.

The point is that there are approximately 3 billion things that are 100% uncertain about the future. Speculators can speculate, and that’s wonderful – but nothing is guaranteed, especially when it’s tagged 10 years out.