[quote=flyer]BG, I completely understand where you are coming from, and I don’t believe anyone is entitled to anything. I’m simply discussing this issue from a scarcity of land perspective, not from the perspective you’ve been discussing. That’s an entirely different discussion, and one that I will leave in your able hands.[/quote]I don’t believe the “scarcity of land in SAN” affects ALL millenials. Maybe a small fraction who are insisting on new construction for their first home.
We just had a new poster post on this thread last night (scottinob) who believes, as a millenial, that he should be able to buy or rent in the area where he grew up in. Essentially, he feels he should be able to live near extended family. Assuming arguendo that his screen name denotes his current area of residence (OB), this must have been the area where he posted he recently got a rent increase of $250 month. If OB (or nearby PL) is where he is from and his “extended family” resides, then naturally, he will not be able to afford to buy in there for his first home, unless he gets substantial help from family. He can shop for SFRs in nearby Linda Vista and Clairemont when he gets a downpayment saved up. The scarcity of land for new subdivisions in the “north 40 full of 1500 lb boulders to clear on a rugged, hilly swath of land east of Rainbow, 7 miles east of I-15 off Lilac Rd” does not affect this (native San Diegan) poster who may want to buy in OB! Whether or not the “suburbs of Valley Center” are ever even subdivided and developed … or not … is not going to affect the RE prices and rental prices in OB one iota.
Scott, please feel free to chime in, here. I’m just using your post for an example and the way I read it between the lines may or may not be accurate.
Sure, we looked in OB to buy our first house back in the day, like any wishful 20-something would. But the listing with the cheapest run-down termite-eaten shack on a substandard lot there with a dirt alley and street parking only (IF you could get a space) had an asking price of $88,900 and at a 12-15% prevailing mortgage interest rate, we only qualified to buy a $73K property (max). Like many young people, our families resided more than 1000 miles away in a locale with much cheaper housing and could not help us. Them’s the breaks! We were young and had to pay our dues somewhere else in SD … like nearly everyone else does. Of course, we bought elsewhere and in the ensuing years, we lost interest in OB.
Whatever happened to a 20 or 30-something having to pay their dues first by buying a “starter home” in a “starter area?” What happened to that concept? These kids today take off out of their starting blocks the day after college graduation, land their first FT jobs and expect almost immediately to have everything their 50+ year-old parent(s) took 25-30 years to acquire. I’m not speaking for every millenial but that mindset/attitude is what I have seen from most of the one’s I know, including my own kid(s) (although they don’t aspire to buy RE as the prices where they live [SF] are thru the stratosphere).
Unrealistic fantastical expectations are severely hampering many millenials from buying their own homes in CA coastal counties … even if they are qualified and have saved a downpayment. It’s like nothing I have ever seen in my entire life. Many of them would rather sit out and rent than buy a property which they feel is less than they feel they are “entitled” to own, even if qualified to buy. This (and the fact that there are so many people competing for good rental homes because they lost their home to foreclosure/short sale in the past 7 years and can’t get a mortgage) are why there are so many prospective tenant applications for each advertised rental and rents have skyrocketed in SoCal, due to the sheer demand for them. Many SD millenials today would rather be a tenant (subject to rent hikes and non-renewal of their lease) than to purchase a home they can afford in an area they can afford … even if they’re qualified to buy and have a downpayment. That’s the way I see it.
flyer, your kids grew up inside the covenant, no? Do they and their peers (who also may have grown up inside the covenant) feel that they must have a comparable home in a comparable area for their first home? You’ve posted several times in the past here that your kids’ HS friends and your friends and neighbors’ kids became highly disillusioned and depressed because they were unable to land a job in their fields in SD after graduating from college so I was just wondering if they expected that they would be able to have their first home inside the covenant :=0
I think the ultra-pickiness of many in the millenial homebuying generation (comparable to the size of the boomer generation back in the ’70’s and early ’80’s) is what is contributing to the public angst re: lack of new construction available in SD County. I don’t think the (oft-touted by the MSM but wholly inaccurate) “housing shortage” is actually “real” in SD County. I think there is plenty of every type of housing for rent and for sale available in SD County at any given time. I just think the millenial home-shopping set is gravitating only to a handful of zip codes for the perceived “lifestyle” they offer. They want to live NOW in what they want, where they want it. When all of them want the same thing, of course, this creates a “shortage” of it. They cannot substitute buying a nice well-built house on a large lot that they can afford in Lemon Grove because that is not what they want, where they want it so they rent in the area they want to live in (or as close to it as they can afford to).
Ten years later, home prices have climbed in the double digits and this group is still renting (but complaining that it is getting too expensive to live where they want to or already forced to rent in another less-desired area.)
This doesn’t bode well for millenials’ future net worth (as a group) but they are willingly doing it to themselves. I hear a lot of complaints on this board and in real estate articles I subscribe to about how millenials won’t ever be able to have what their Gen X or boomer parents have and I just don’t buy it. The truth is, they don’t want it bad enough. They don’t want to do what it takes to get it. This generation appears to have adopted a “live for now” motto.
