According to several recent studies the younger generation today would rather rent than own their home. True, the recession has done a number on their job opportunities. Plus, many are busy paying down debt and working hard to make themselves ready to own one day. But unfortunately we all know tougher mortgage credit requirements are eliminating “too many” good, potential home buyers.
What’s alarming is that a greater number that can buy are simply choosing to rent. And the main reason… well, you guessed it: they are saying that they aren’t ready to settle down. They possess a strong desire to travel and explore before they get more “serious” with life.
So what’s the concern? Well, a couple things come to mind. First, the obvious negative effects on our economy from less Americans owning homes. Second, if this group chooses to rent for a long period of time before they purchase a home their personal wealth could suffer long-term. With the time-value of money principles working against them and delaying this traditionally effective form of saving (building equity) through home ownership at young ages, some of this generation may never replenish the cost of such a delay.