Five Root Causes for Depressed Homeownership Rate in Alexandria
The National Association of REALTORS recently held the Sustainable Homeownership Conference at the University of California, Berkeley, where a group of experts discussed potential ways to reverse the decline in homeownership. During the meeting, the five main reasons why would-be buyers are locked out of the housing market were discussed.
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Post-foreclosure stress disorder – The Great Recession caused long-lasting psychological changes in the financial decision-making for the estimated 9 million homeowners who lost their homes to foreclosure and the millions who lost their jobs.
Mortgage availability – Credit standards have not normalized since the recession, and borrowers with good-to-excellent credit scores are not getting approved at the rate they were in 2003.
Growing burden of student loan debt – Repaying student loan debt is making it difficult for young households to save for a down payment and qualify for a mortgage.
Single-family housing affordability – Lack of inventory, high home prices and high rent are causing decaying affordability conditions in many markets.
Single-family housing supply shortages – An inadequate level of homebuilding has led to a cumulative deficit of nearly 3.7 million new homes over the last eight years.
Allison Nesbitt Johns is a native of Northern Virginia and a graduate of James Madison University. She is a full-time elementary school teacher and helps out at Nesbitt Realty during summer months and other times when school is out of session.
