The demand side: Why there are so few homes in the Albuquerque’s Real Estate Market?
(Transcript Snippet): Tego: Speaking of, of misinformation. I hear a ton of people going, oh, but the foreclosures are coming, the forbearance, the everybody’s going to be, you know, all these homes are going to flood the market. Well, one of the supply challenges has been that we’ve had this foreclosure moratorium since the beginning of the pandemic, which is great. I get it. I understand, you know, help people out that, that, you know, were basically unable to work for stuff out of their control. Right? We’ve got these forbearance plans, which are keeping people in their home that, you know, maybe would have been selling, but you know, on a forbearance plan, they’re not paying their mortgage. They’re able to stay in their home without a monthly payment. Now that’s going to catch up to them at some point, there’s going to have to make good on it at some point, but there are a lot of people that have been, been not making a payment for a year in or more so again, that’s another COVID related reason for the short supply as this, again, these foreclosures distress sales not coming on the market.
Tego: There’s been a few, but it’s, it’s very limited, very, very limited it’s any of the mortgages that were backed by any of the, the government plans. Those homes are not being foreclosed. Okay. Let’s talk about demand. Homeownership rate dropped to a, a pretty big, low back. I’m going to pull up this chart here from the the fed they’ve do some great charts. And, and so in, just give you some perspective here in 2004, 2005, this was an all time high home ownership rate in the United States was 69%. That was a really high number. However, what happened was it dropped to a low in 2016 of 62%, which was really, it was a historic low. And I remember back at that time, there was all those stories, oh, these millennials, these young people, they are not going to want to own a home.
Tego: They’re going to want to live in, in the city. They’re gonna want to commute to work in the Uber and they’re never gonna buy a house and they’re never gonna buy a car and they’re going to get their door dash delivered and all this. Well in 2016, we saw reversal and ever since then, we’ve had this increase in home ownership rate. People started to come into the fact that home ownership is great. You know, there’s tons of advantage, not just the financial, but it, you know, there, there is a lot of other reasons just American dream, that, that, that whole conversation, I won’t go into all that right now. But so ever since 2016, we have seen an increase in buyer demand around the country. Another part of this demand story is something I just mentioned, which is the demographics, the millennial generation is the largest demographic generation ever in American history, bigger than us boomers on what do I call myself? Uh, I’m a tailing boomer. I’m a little older, a little younger boomer, but anyway, they are the biggest generation ever. And they’re right now in their prime home buyer, first time, home buyer years. And there’s a Logan Mashami, who’s one of the, uh, economists housing economist. I follow. He’s been, he’s been talking about this for two years, that it’s coming come to 2020 through 2024. We’re going to have all this big, this big demographic of people coming into home by an age. And, and that’s, what’s happened. They’ve moved into home by an age, and that has driven demand a lot faces. Okay, let’s get back to this demand thing. So, um, I, the demographics thing I hit on that let’s talk about, um, the fact that there’s a lot of people that were on the edge of buying had kind of been on their list.