According to the Mortgage Bankers Association (MBA), 1.2 million households were lost from 2005 to 2008, despite the population increase of 3.4 million in the study area.
This decline in households is likely what contributed significantly to the excess supply of apartments and single family homes on the market. The study, “What Happens to Household Formation in a Recession,” was conducted by Professor Gary Painter of USC and sponsored by the Research Institute for Housing America (RIHA). It analyzes the impact of economic and housing conditions on household formation and how the recent recession has affected Americans’ propensity to form new households, mobility trends, and changes in the rate of overcrowding.
Key trends are:
- In a recession, the likelihood that a young adult will form an independent household falls by up to 4 percentage points depending on the age of the person and severity of the changes in unemployment rates. In this particularly severe recession, this prediction has been borne out with data through 2008 revealing a reduction of nearly 1.2 million households nationwide despite the continued increase in population and likely even more households lost in 2009.
- Though the national homeownership rate has fallen from a peak above 69% to just over 67%, this decline may be understating the magnitude of the change when we take into account the simultaneous drop in renter household formation. In fact, the rental market saw a steeper decline in new households formed than the homeownership market. As a result of this drop, the denominator in the homeownership rate calculation has been reduced, mitigating the decline in homeownership.
- This recession has also caused a dramatic increase, almost five-fold, in the rates of overcrowding (defined as having more than one person per room in the household), indicating that many families are doubling up in response to the downturn.
- Overall, there was a greater impact on the creation of new households among native born Americans over new immigrant households. The data show native born Americans experienced a larger decline in household formation and a larger increase in overcrowding rates than immigrants.
- Children whose parents have higher incomes are more likely to remain at home, with this effect largest for youths moving into the rental market. However, children whose parents have higher financial wealth are more likely to form their own new rental households.
OK SO LETS GO OVER SOME SIMPLE MATH:
1,200,000 HOMES / 50 STATES IN THE U.S. = 24,000 HOMES AVERAGED PER STATE
SIMPLY PUT THERE IS A PLETHERA OF INVENTORY AND THERE HAS NEVER BEEN A BETTER TIME TO BUY!
I DO NOT CARE IF YOU ARE INVESTING LOCALLY OR BUYING BULK INVENTORY "1 HOME TO 1,000+", I HAVE THE SUPPLY.
The REO product is direct from the source for all states and regions. The most comprehensive thing about these programs is the direct cost given to you the end buyers. The company acts as the buying Mandate allowing our partners and clients to access the same inventory we purchase at the direct price we receive it for. We act as you’re buying Mandate passing the direct cost on to the buyers without all of the daisy chains. All fees associated with purchasing is 3% for a full service suite of services, all you have to do as the client is sign the contracts and show up for the closing.
The Official website will be up and running full steam on or before August 14th 2010 offering bulk product direct from the banks to buyers across the globe. Make sure if you are a real buyer to register today and make sure to review the programs below for immediate purchase of inventory direct at real direct bank pricing.
1. Daily Buying by City and State.
This program is designed for all buyers who are looking to purchase specific homes based on geographic regions on a daily, weekly or bi-weekly basis.
• All 50 States
• 1unit – Unlimited
• $2k Earnest per home
• Buyer Specific Properties
2. Custom Tape Nationwide “5 Million Minimum”
This program is designed for the larger buyer looking to purchase Bulk REO properties in Tapes across the country. These tapes are built directly for the specific buyer with the supplying banks.
• All 50 States
• 5 Million Minimum
• 10% Earnest per tape
• Monthly Closing
3. Monthly Nationwide Tapes by State
This program is designed for buyers that purchase smaller to medium Bulk REO tapes averaging 20- 100 properties per state. Tapes are delivered on the first of every month for closings on the 15th of every month.
• All 50 States
• Unlimited amounts of inventory if purchasing nationwide
• 150k Earnest
• Consistent monthly supply up to 200 million per month
4. Non Performing Notes Nationwide
This Program is designed for buyers that purchase Nationwide NPN’s. Product is delivered on the first of every month for closings on the 15th of every month.
• 10% Earnest
• Consistent monthly supply at $.30 cents or less