Daughter Doesn’t Buy Dad’s Cheering of U.S. Home ownership.

http://www.bloomberg.com/news/2014-07-11/daughter-doesn-t-buy-dad-s-cheerleading-for-u-s-homeownership.html

David Stevens, chief executive officer of the Mortgage Bankers Association, has spent his career touting the merits of homeownership. One person still isn’t buying it: his daughter.

Sara Stevens, 27, knows interest rates are low, rents are high and owning a home can build wealth. She also had a front-row seat to the worst real-estate slump since the Great Depression.

“The world has changed,” she said.

Six years since the collapse of Lehman Brothers triggered a financial meltdown, some young adults are more risk averse and view the potential upsides of status and wealth more skeptically than before the crisis, altering the homeownership calculation. It’s more than the weight ofstudent loans, an iffy job market and tight credit -- even those who can buy are hesitant.

The doubt is so pervasive that it’s eroded entry-level sales and hampered the recovery. In May, the share of first-time buyers fell for the third month, to 27 percent, according to the National Association of Realtors. Historically, it’s been closer to 40 percent of all buyers.

“We have a younger generation that has sat on the front lines of this housing recession,” said Stevens, 57. “They’re clearly being more thoughtful about it and they’re clearly deferring that decision.”

Most still aspire to own, though just 52 percent consider homeownership an “excellent long-term investment,” according to an April survey from the Chicago-based John D. and Catherine T. MacArthur Foundation. And almost three-fourths of adults 18 to 34 years old say the U.S. still is in the throes of a housing crisis, a bigger share than any other age group.

Without first-time buyers, current owners have a harder time selling and trading up, depressing the market and dragging down the economy. U.S. homeownership fell for the ninth straight year in 2013, to 65.1 percent, according to the Commerce Department. The MBA is projecting sales will decline for the first time in four years.

“We need more warm bodies buying homes and first-time buyers are the way to get it,” said Mark Fleming, the Vienna, Virginia-based chief economist of property-data firm CoreLogic Inc.

David Stevens, president and chief executive officer of the Mortgage Bankers Association, stands with his daughter Sara Stevens in the Senate Russell Building in Washington, D.C., on June 5, 2014.