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Reyne Stapelmann: 7.3 Million Boomerang Buyers Poised to Recover Homeownership

In 2015, the first wave of 7.3 million homeowners who lost their homes to foreclosure or short sale during the foreclosure crisis will pass the seven-year window they conservatively need to repair their credit and qualify to buy a home.

More waves of these potential boomerang buyers will be moving past that seven-year window over the next eight years, corresponding to the eight years of above historically normal foreclosure activity from 2007 to 2014, according to an analysis by RealtyTrac.

While millennials have gotten a lot of attention lately as the generation whose below-normal homeownership rates are changing the landscape of the U.S. real estate market, the boomerang buyers — who are primarily Generation Xers or baby boomers — represent a massive wave of potential pent-up demand that could shape the housing market in the short term even more dramatically.

U.S. Census data shows homeownership rates for those ages 35 to 44 — roughly Generation X — were 11 percent below historical averages in the third quarter of 2014, while home ownership rates for the below age 35 cohort — roughly the Millennial generation — were 10 percent below historical averages.

RealtyTrac analyzed foreclosure, affordability and demographic data to provide predictions of when and where these boomerang buyers are most likely to materialize. Nearly 7.3 million potential boomerang buyers nationwide will be in a position to buy again from a credit repair perspective over the next eight years.

Taken from: California Association of Realtors Newsline, Jan. 28

Reyne Stapelmann is a broker associate with Berkshire Hathaway Home Services, California Properties and the 2015 president of the Santa Barbara Association of Realtors. Contact her at [email protected] or 805.705.4353. The opinions expressed are her own.

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