Housing Boom Not Over Yet
February 13, 2002
Survey Says Housing Will Be Economic Driver For Next Decade
Inman News Features
After preventing a deeper recession last year, the national housing market will help revive the economy in 2002, according to a new study commissioned by the Homeownership Alliance.
The study, "Safe at Home: The New Role of Housing in the U.S. Economy," contends that housing will be a leading driver of economic growth over the next decade as it continues to expand without the dramatic booms and busts of prior cycles.
Two new forces will fuel the housing market, according to Todd Buchholz, a former White House economic advisor and chief author of the study. One force is retiring baby boomers, who, enriched by the bull stock market of the 1990s, have become home buyers rather than home sellers. The second force is the burgeoning population of minorities and recent immigrants who are on the "tipping point" of being able to afford their first home.
"Housing demographics should be more favorable in the decade ahead, especially as baby boomers, minorities and recent immigrants push up their ownership rates," said Buchholz. "The national homeownership rate could, for the first time, surpass 70 percent by 2010."
According to Buchholz, forecasters in the late 1980s who predicted a rather long-lasting downturn in the housing market did not foresee how minority families would burst onto the home-buying scene. In addition, senior citizens will not be dragging down the housing market in the next 10 years, but rather will be helping to lift it up, the study predicts.
The Washington, D.C.-based Homeownership Alliance is a coalition of housing organizations. Members include the Consumer Federation of America, Fannie Mae, Freddie Mac, Habitat for Humanity International, the National Association of Home Builders, the National Association of Real Estate Brokers, the National Bankers Association, the National Council of La Raza and the National Urban League.
Copyright: Inman News Service