So, my morning began with a Seattle Times article that says that more apartment hi-rises are being rushed to development because demand for rentals–especially from younger workers–is out-stripping supply (“Hot Market for Rentals Inspires Twin Towers” 4.20.11).
Fair enough. But it was the following statement, a phrase I’ve seen used again and again in media reports, that frankly baffles me a little;
“…younger workers are turning to apartments because they recognize owning a home could interfere with their ability to go where the jobs are (in the future)”.
Sorry, I’m just not buying it.
Sure, this strategy might sound reasonable if you’re single, 23 and seeking your particular spot in the world…but is that still the best strategy when you’re 28? 31?
As a young man, I was left my hometown of San Diego and ventured to Nebraska, lured by a job with Omaha Magazine. The magazine soon folded, and after enduring two of the most horrific winters imaginable (a fierce two minute hail storm once dimpled my car so thoroughly it became more golf ball than automobile), I packed up and returned to San Diego. Eventually, the terrific job I have now opened up in the Pacific Northwest, and once again my wife and I were off to a new location.
Each time I relocated, I already owned a home. Each time I relocated, I also bought a home in my new location. Homeownership was not a personal hindrance, and it didn’t keep me from making career decisions (even bad ones, like Omaha). If you’re thinking “Sure Sparks, but look how much tougher the housing market is now”, you’ve never tried to sell a split-level home in Omaha, believe me. But I did it, and others have done it too.
Many people today are looking at the market through the prism of the last few years. This is completely understandable, especially for younger adults who have only experienced the wild highs and disappointing lows of this historically unique real estate cycle. If you stepped into an elevator that had only two buttons, “PLUNGE” and “SOAR”, how comfortable would you be getting on that elevator, especially the first time?
Historically, we know that most real estate cycles are not ‘epic’ events, as this one was. We also know that renting is not the personal choice for the majority of Americans. As we mature and our adult lives and relationships take hold, long-distance job hopping becomes much more daunting. Most people put down roots, make good friends, and become ingrained in the culture of a city or neighborhood. They don’t call them “the ties that bind” for nothing.
People love owning their own space. Homeownership isn’t for everybody, but neither is the nomadic lifestyle of a contract worker, constantly seeking the next employment perk.
So, is this renting strategy permanent, or simply a knee-jerk reaction to deal the economic fears and apprehensions of the moment? One thing we can be sure of…these economic circumstances will always ebb and flow, and things will always change.
Ultimately, I believe that younger people facing the reality of ever escalating rents and highly regulated living space (no pets, no noise, no painting, no car washing, no parking, no changing anything…!), will elect the path that two out of every three Americans choose…Own Sweet Own.
Ron G. Sparks