What community features do Gen Y’s want?
What is the prediction for Bay Area rents?
What options do Gen Y’s have for their Bay Area housing?
If you are a Generation Y your ‘story’ probably is similar to this one. Your parents told you to go to college so you could get a good job, and buy a home. You followed their advice about college, however when you got out you ran right into a recession where jobs were scarce. This required you to stay mobile in order to have the flexibility to go where jobs are. In the Bay Area this is called ‘urban migration’. In 2012, the #1 reason why people are moving is because of employment – across town and across the country. What you are also discovering is that the demand for rental housing has surpassed the supply so rents are scarce and rent rates are through the roof. Does this story sound familiar?
Last January my 2012 predictions blog had four topics on which to pay attention this year. One of them was the Bay Area rental markets. Here was what I wrote last January, “The rental market will continue to thrive in 2012. With people exiting distressed properties and potential Buyers deciding to postpone a home purchase, it is a perfect storm for those who own rental properties to get premium rents.” Now, as a highly educated Gen Y, and one who needs housing, you are in that perfect storm – low inventory of rental housing and skyrocketing rents from landlords who know they can get it. And, there are 30,000 new jobs needing to be filled in the Bay Area right now!
Here is the description of what the Gen Y want their community to have; walkability to all they need, and access to public transportation. So, what are your housing options? There are actually three options available today to the Gen Y participating in the urban migration game.
- Pay the high rental rates in the community that best meets your quality of life requirements. (Archstone is one of the companies providing great rental options serving the Bay Area – from the Peninsula to the East Bay real estate markets.)
- Purchase a home, townhome or condo given that mortgage interest rates are at historic lows of 3.5% which creates a monthly payment less than current rents in the urban centers of the Bay Area. The rent vs. buy decision is being made for you because of mortgage interest rates. (However, you will need to have a down payment and great credit scores to take advantage of this option.)
- Find a roommate or live with a relative or friend. (This is happening often in today’s housing market.)
Here are some tips for the three options for Gen Y that will be of help. With Option #1 use CraigsList.com for your searches. You may even consider knocking on the doors of places you would like to live and see if you can snag a place before it even gets on to CraigsList.com. The challenge the Gen Y has with Option #2 is there are so many buyers competing for the same property, and lenders only want the very best borrowers. However, if you can afford to purchase a home the benefits far outweigh renting today – promise. Just saying… And, Option #3 is obviously the last alternative. However, it is often the only choice for many of the Gen Y’s who are in the midst of the urban migration. They have landed a great job, and they can’t find housing.
We are so fortunate to live in the Bay Area and have an economy that is leading the country out of the past five year recession. If you need a Realtor, we are here to be of service, no matter if you are a Gen Y figuring stuff out, downsizing, relocating, or for any of your real estate needs. Contact us today. We are really good at what we do and we are fun. Until next time…Jim Walberg.