Mike Marshall contributed to this post.
Dowell Myers, demographer with the USC Sol Price School of Public Policy, joined BPC’s 2014 Housing Summit to discuss how demographic trends will shape the US housing market and whether federal policy will anticipate the significant shifts taking place.
Dowell wasted no time sounding the alarm, letting the audience know, including five former HUD Secretaries assembled for the luncheon panel, how timely this housing summit is. “We need it desperately,” he said, stressing the urgency of the moment that we are in.
“Never before have we been in period of great uncertainty…triple uncertainty… A recovery delayed longer than anyone expected… On top of that we have these changing demographics…If we can get demographics right we might be able to solve the other uncertainty, which is political uncertainty,” Dowell said. “Open our eyes to new demographics.”
Among a slew of relevant data points that Dowell shared, one of the most powerful was an analysis of the economic power of the Millennials. The Millennial Generation is bigger than Generation X — 80 million strong verses 70 million births respectively. Based on size alone, Millennials possess up to 16 percent more market share and therefore have a greater economic impact. Millennials are also more diverse, face stagnant wages, rely heaving on the wealth on their parents and have restricted access. As a result, Millennials have only a quarter of market power that they might otherwise have.
The challenge is whether we can get the economy and economic policies that return us to a “new normal.” There is momentum Dowell argued to the downside here. “The biggest question is how low can it go. How low will home ownership go? It was 69%, it is now 64%. [There is] a lot of momentum built into this that we need to correct or it will sink lower.”