Home prices are going to keep rising faster than incomes in the coming year – not a good thing for affordability, according to a forecast released today by a national real estate data company.
And that decline in affordability will have impacts that are geographic and generational, said the report from Seattle-based Zillow: mainly by extending recent trends.
The last few years have seen young adults more commonly delaying marriage, as well as the purchase of a home. Higher prices for homes will accentuate those tendencies, according to Zillow.
The company predicts that millennials will continue to put off home-ownership.
“The median age of first-time home-buyers – already the highest it has ever been at about 33 – will climb higher,” said Svenja Gudell, Zillow’s chief economist. “Millennials want to buy, but they are waiting longer than previous generations.”
The attractiveness of life in cities has been steadily nudging the cost of in-town housing higher. That means higher rents for people who don’t want to buy a home. And it can’t help but change the choices for people who do want to buy homes, she said.
Zillow predicts that new home buyers will increasingly look to homes farther away from town in search of affordability.
Rents in metro Atlanta rose at a 6.6 percent pace last month, according to Axiometrics, a Dallas-based company specializing in apartment and student housing market research.
That compares to the national rate of 4.9 percent.
According to company calculations, Atlanta renters paid an average of $1,041 for September, $64 more than the average of a year earlier, according to Axiometrics.