The federal reserve controls short-term interest rates through buying and selling Treasury notes. These rates determine how much interest people earn in savings accounts, the asset class favored by senior citizens. The federal reserve lowered interest rates to zero to force money out of savings accounts in hopes this money would seek out riskier asset classes and stimulate the economy. Since seniors are risk adverse, most have left their savings in place, and those that need those savings to survive — which is most seniors — are depleting their savings accounts to make ends meet. 
When many seniors planned their retirement, they counted on a certain amount of interest income to survive. The federal reserve has instead diverted this money to its member banks to help them earn their way back to solvency. In other words, the federal reserve has taken food out of the mouths of seniors so bankers can continue to make money, earn bonuses, and otherwise rape and pillage the American economy.
One of the reasons the federal reserve recently began buying more mortgage-backed securities is to lower home mortgage rates to stimulate housing. The collapse of the housing bubble is causing a general economic malaise, and both the lowering of Treasury rates and mortgage rates are intended to lift housing and the overall economy.
Although the federal reserve ostensibly wants to keep loanowners in their properties, their policies are having a broad but unintended side effect. By taking away income seniors were counting on in their retirement, many lifelong homeowners are finding themselves unable to make their mortgage payments. These seniors are probably going to lose their homes in foreclosure. Many of these wounds are self-inflicted, but at their age, seniors have little chance of recovery.
Seniors increasingly are facing foreclosure
By Ana Veciana-Suarez — Miami Herald
MIAMI – Marie Ginise thought she and her husband, Joseph, had prepared well for retirement. They worked hard to build up their asphalt driveway business, saved a few pennies and eventually moved to Florida from Connecticut to enjoy their golden years.
But when Joseph got sick and died, Marie, 75, realized she could not afford the two-bedroom manufactured home the couple bought in Deerfield Beach, Fla., in 2005. Now, instead of enjoying shuffleboard and card games in her senior community, she’s fighting off foreclosure.
“I cry every night when I go to bed,” Ginise said. “You work for something your whole life, and then it doesn’t turn out like that at all. I don’t know if I’m here or there.”
Her circumstances are very sad. At her age, she shouldn’t be worried about losing her home. However, she probably also shouldn’t have created the circumstances where she could lose her home.
For example, my parents own a very modest manufactured home in Bradenton, Florida. They actually own it. There is no mortgage. They could have taken the $60,000 they paid for that property and put 20% down on a much more comfortable $300,000 McMansion on a golf course in a high-end senior community. If they had done that, they too would be underwater, stressed out, and facing possible foreclosure. Instead, they have a stress-free retirement and money to travel.
The decisions we make have consequences. Many of the seniors profiled in this news article made bad choices. However, some were counting on interest income they are no longer getting. It’s those seniors who are being screwed by the federal reserve.
Marie Ginise is among the older Americans who owe more on their homes than they’re worth after the real estate crash – but with less time to make up the financial loss than those who are younger. An AARP report released this summer, “Nightmare on Main Street: Older Americans and the Mortgage Market Crisis,” revealed that:
- About 3.5 million loans held by people older than 50 (or 16 percent of all loans for that group) were underwater as of December.
- The percentage of seriously delinquent mortgage loans increased from 1.1 percent in 2007 to 6 percent in 2011 for people 50 and older.
- The foreclosure rate for people 50 and older also increased, from 0.3 percent in 2007 to 2.9 percent in 2011.
“It’s like the end of the American Dream for them,” said Gladys?Gerson, a supervising attorney for Coast to Coast Legal Aid of South Florida. “They’re very embarrassed that they can’t maintain their own home.” …
Older Americans are struggling to make ends meet on nest eggs that are earning paltry returns, but the underlying factors of the mortgage crisis began long before the Great Recession.
The fact that seniors are earning such low returns is a direct result of federal reserve policy. In a free market, their savings would command a premium today. Instead, the federal reserve has made their savings earn almost nothing.
As housing prices soared, older homeowners took home equity loans and second mortgages on their houses, just as their younger counterparts did – but with less time to weather the financial storm if the monthly payment became unaffordable.
“If you’re 65-plus, it’s not like you can take a second job to make the payments,” said Debra Whitman, AARP’s executive vice president for policy. “Your income just doesn’t change much. You have a lot fewer options.”
Seniors are generally retired and past their prime earning years. They don’t have the time, the energy, or the ambition to go back to the daily grind to make more money to pay off their mortgages.
The AARP report noted that older Americans are carrying more mortgage debt than ever before. This spells trouble because home equity has often been used to help pay for medical bills or supplement fixed incomes later in life. …
“There are limited things they can do” in the case of a foreclosure, Gerson said. “If they’re lucky, maybe they move in with a relative or rent a room somewhere. But most fear that they’re going to be stuck in some institution at the end of their years.”
… “I live one day at a time,” she said, her voice wavering with emotion. “I never thought I would end up this way. I’ve lost everything.”
Debt is nothing to fool around with, particularly for seniors. Beyond age 50, most people should be focused on paying off debts in preparation for a debt-free retirement. Very few actually do this. One of the fallacies that was widely embraced by seniors was that rising house prices can fund a comfortable retirement. It can’t. Those that embraced that foolish idea are doomed to spend an impoverished retirement full of stress and disappointment.
The federal reserve set out to make the lives of homeowners better. What they have accomplished is to impoverish seniors who were counting on interest income on their savings, and in the process, the federal reserve caused many seniors to lose their homes because they couldn’t keep up on their mortgage payments without that interest income.
Over three years squatting and plenty of HELOC money
Today’s featured REO is a 2002 rollback. The former owners paid $650,000 back on 12/5/2002. The ran their debt up to $870,000 before prices went south. The defaulted in late 2008, and they weren’t forced out until June of 2012, over three and a half years later.
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Proprietary OC Housing News home purchase analysis
24672 CHARLTON Dr Laguna Hills, CA 92653
$654,000 …….. Asking Price
$650,000 ………. Purchase Price
12/5/2002 ………. Purchase Date
$4,000 ………. Gross Gain (Loss)
($52,000) ………… Commissions and Costs at 8%
============================================
($48,000) ………. Net Gain (Loss)
============================================
0.6% ………. Gross Percent Change
-7.4% ………. Net Percent Change
0.1% ………… Annual Appreciation
Cost of Home Ownership
——————————————————————————
$654,000 …….. Asking Price
$130,800 ………… 20% Down Conventional
3.51% …………. Mortgage Interest Rate
30 ……………… Number of Years
$523,200 …….. Mortgage
$122,734 ………. Income Requirement
$2,352 ………… Monthly Mortgage Payment
$567 ………… Property Tax at 1.04%
$0 ………… Mello Roos & Special Taxes
$164 ………… Homeowners Insurance at 0.3%
$0 ………… Private Mortgage Insurance
$88 ………… Homeowners Association Fees
============================================
$3,171 ………. Monthly Cash Outlays
($367) ………. Tax Savings
($822) ………. Equity Hidden in Payment
$146 ………….. Lost Income to Down Payment
$102 ………….. Maintenance and Replacement Reserves
============================================
$2,229 ………. Monthly Cost of Ownership
Cash Acquisition Demands
——————————————————————————
$8,040 ………… Furnishing and Move In at 1% + $1,500
$8,040 ………… Closing Costs at 1% + $1,500
$5,232 ………… Interest Points
$130,800 ………… Down Payment
============================================
$152,112 ………. Total Cash Costs
$34,100 ………. Emergency Cash Reserves
============================================
$186,212 ………. Total Savings Needed
The property above is available for sale on the MLS.
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24 Responses to “Federal Reserve’s policy to save housing is forcing seniors into foreclosure”
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“It’s like the end of the American Dream”
———————————-
Sadly, indeed it is.
Reminder: once a market comes to the realization there’s a sucker holding a substantial, mis-priced position, it will sell against it, knowing that in due time the holder(s) always run out of money to keep buying.
tic…tic…
Fed Cannot Ignore Harm Caused by Housing Bust: Bullard
The U.S. central bank would be courting disaster if it pursued a so-called nominal growth target that did not take into account the economic damage done by the housing crisis, a senior Federal Reserve official warned on Thursday.
James Bullard, president of the St. Louis Federal Reserve Bank, also argued that the only variable in the economy the Fed could control over the longer term was inflation, saying it did best when focusing solely on that goal.
Bullard, in a lecture at the University of Notre Dame in Indiana, said the pre-crisis housing bubble had driven U.S. growth to levels that were not realistic to try to recapture. He cited work by economists Carmen Reinhart and Kenneth Rogoff that argue recoveries after a severe financial crisis are much slower.
“Attempting to target nominal (gross domestic product) without adjustment for the Reinhart-Rogoff effect could be an unmitigated disaster,” Bullard said during his presentation.
Frustration with a slow decline in high U.S. unemployment has sparked calls by some economists for the Fed to target nominal GDP, which measures growth in output before adjustments for inflation. They argue this would help communicate a powerful commitment to do whatever it takes to restore growth to its pre-crisis levels.
The Fed last week announced an aggressive plan to buy $40 billion of mortgage-backed securities every month until it saw a substantial improvement in the outlook for the labor market.
Bullard, who is not a voting member of the Fed’s policy-setting committee, told Reuters in an interview on Tuesday that he did not agree with the action. He said he would have dissented had he had a vote, because he would have favored seeing clear evidence the economy was slipping and risked another recession before launching the plan.
U.S. unemployment was 8.1 percent last month and economic growth remains stuck around 2 percent, despite cuts in the Fed’s target overnight interest rate to near zero and massive bond purchases. The bond purchase caused the Fed’s balance sheet to balloon to $2.3 trillion, even before last week’s news.
Mortgage Delinquencies down a mere 2% over last 12 months
Loan delinquency in the United States continued to drop in the month of August, according to first-look data from Lender Processing Services (LPS).
According to data released Monday, the total delinquency rate (for loans 30 or more days past due but not in foreclosure) was 6.87 percent in August, down 2.3 percent from July. Year-over-year, delinquencies fell 10.6 percent.
An estimated 3,430,000 properties were 30 days or more past due (but not in foreclosure) at the end of August. Approximately 1,520,000 were 90 or more days delinquent but not in foreclosure.
A total of 5,450,000 properties were 30 or more days overdue or in foreclosure.
The foreclosure pre-sale inventory rate fell 1.0 percent from July, with the number of properties estimated at 2,020,000. Yearly, the inventory rate dropped 2.0 percent. The estimated foreclosure pre-sale inventory rate was 4.04 percent.
Nevada and Florida once again made the list of the top five states with the highest percentage of non-current loans. They were joined by Mississippi, New Jersey, and New York.
The list of states with the lowest percentage of delinquent loans included Montana, Alaska, South Dakota, North Dakota, and Wyoming, all of which consistently rank near the top.
Your headline contradicts the last line of the second paragraph. The 2% drop was from July to August.
Shadow inventory is now declining rapidly due to elevated short sales that began once TBTF banks settled with the state AG’s. It took about 4 years, but the pundits were finally correct when predicting “the year of the short sale”.
With the settlement, short sales are strongly encouraged. They will do as many of these as they can until they reach their settlement requirements. At that point, they will need to ramp up the foreclosure machinery one more time to force out the committed squatters.
These idiots never give up trying to reflate the bubble.
NAR: Tight Lending Standards Stunting Home Sales and Employment
If Realtors have anything to say about tight lending standards, the observation would be such standards are preventing more home sales and holding back job creation.
The Washington, D.C.-based National Association of Realtors recently reached their conclusions in a survey conducted with real estate agents.
“Sensible lending standards would permit 500,000 to 700,000 additional home sales in the coming year,” NAR chief economist Lawrence Yun said in a statement. “The economic activity created through these additional home sales would add 250,000 to 350,000 jobs in related trades and services almost immediately, and without a cost impact.”
The findings? Lenders take too long with applications, requiring excessive information and preferring only interested homebuyers with high credit scores.
Survey respondents reported that 53 percent of loans went to borrowers with credit scores above 740 in August, a sharp contrast when compared with the fact that 41 percent of homeowners with the same credit held these mortgages from 2001 to 2004.
According to NAR, about three-fourths of loans bought by Fannie Mae and Freddie Mac went to borrowers with credit scores of 740 or above.
The trade group observed that loan applications backed by the Federal Housing Administration showed an average FICO score of 669 in May, significantly higher than 656 for loans originated in 2001.
Yun intimated that reportedly tight lending standards could hurt existing-home sales, which typically range from 5 million to 5.5 million in better times.
“Sales this year are projected to rise 8 to 10 percent. Although welcoming, this still represents a sub-par performance of about 4.6 million sales,” Yun said.
“These findings show we need to return to the sound underwriting standards that existed before the aberrations of the housing boom and bust cycle, and thoroughly re-examine current and impending regulatory rules that may cause excessively tight standards,” he added.
While looser lending standards can threaten default rates, NAR brought attention to improving loan performance in recent years.
Yun pointed out that since 2009, the 12-month default rates have been abnormally low, with Fannie Mae default rates averaging 0.2 percent and Freddie Mac rates averaging 0.1 percent. NAR stated this is notable considering higher unemployment in the timeframe.
In 2007, the twelve-month default rates peaked to 3.0 percent for Fannie Mae loans and 2.5 percent for Freddie Mac loans, according to NAR.
I would like NAr to teach an economics class. It would be fun.
Actually, I heard on NPR that NAR has started a school to coach aspiring political candidates how to run for office. Presumably, they will fund the candidates that finish the training in exchange for them introducing favorable legislation. This is not a joke.
That’s taking lobbying to a whole new level. I can’t say I’m surprised. They try to buy politicians all the time.
NAR must have paid for John Campbell’s college tuition and first 3 years cost of living. He’s like a bit bull on this eminent domain of mortgages issue stuff. Not that I’m fan of eminent domain, but he has been first to submit legislation to block it.
And I think IR wrote that he push to increase the conforming limit to $729,000 for FHA in Orange County. I could be wrong.
Is the Romney campaign circling the drain?
Romney Releases White Paper on Housing, Critics Question Timing
With one unfortunate gaffe and down polls embroiling his campaign, Republican presidential nominee and former Massachusetts Gov. Mitt Romney unveiled a housing white paper on Friday to reposition his message and salvage his campaign.
The document, titled “Securing the American Dream and the Future of Housing,” proposes a return of private capital to the secondary mortgage market, devolution for Fannie and Freddie Mac, and places a strong emphasis on the 12 million jobs the Romney administration pledges to create, even while it skirts the details.
The paper shifts away from a hard-nosed look at the foreclosure crisis by waxing with concern about homeowners in distress, underscoring the fact that Floridian households account for the one in four delinquent mortgages across the country today.
Important passages sought to link the still-recovering housing market to a myriad of relief programs under the Obama administration.
“The weakness of the recovery has left many in America struggling to make ends meet, pay their bills, or stay current on their mortgage payments,” the paper reads, addressing the more than 3 million delinquent households “[d]espite an alphabet soup of federal housing assistance programs.”
The white paper represents one in a slew of recent pivots by the Romney campaign as it attempts to steer clear of repeated gaffes on the campaign trail.
Political analysts chalked up the release of his tax records as a way for the Republican ticket to change the conversation about a secretly recorded video that showed the former Massachusetts governor saying that “47 percent of the people will vote for the president no matter what.
“And so my job is not to worry about those people,” he adds in the video, which Mother Jones received from an anonymous attendee at one of the candidate’s earlier fundraising functions.
In past interviews with sister publication, MReport, seasoned politicos dismissed any promise of serious housing policy reform from either of the major party candidates.
Lawrence J. White, a professor of economics at New York University’s Stern School of Business and a past member of the now-defunct Federal Home Loan Bank Board, told us back in May that it will likely take an “independent political appointee” with the elbow-room needed to deal with bigger-than-life issues like government sponsorship for Fannie Mae and Freddie Mac.
“It’s easy to say Fannie and Freddie are mistakes and let’s get rid of them-that’s campaign material and there’s broad consensus there,” he told us. “The difficulty is: What replaces them?”
In the video, Romney himself seems to dismiss white papers like the one on housing policy.
Responding to an audience member, he says that “[w]e have a website that lays out white papers on a whole serious of issues,” adding, “I don’t think this will have a significant impact on my electability.”
I remember a couple of your readers getting quite pissed when I told them back in the Spring that the polling indicated Romney could not beat Obama. So much for the Republicans nominating “the most electable candidate”.
Gary Johnson 2012
This election is reminding me of 1996. The Republicans got excited about what they perceived as a weakened Democratic incumbent. Bob Dole ran a lackluster campaign and steadily faded. Romney is fading, and if he doesn’t reverse the polls, he will become a joke.
I think you’re right in terms of how this election feels, except Romney doesn’t have Ross Perot splitting his vote! It’s incredible that with 8-9% “official” unemployment that the Republicans aren’t mounting a winning campaign. I predict there will be some major soul searching after this election is over.
Although this cycle I don’t see a lot of Obama signs and bumper stickers like I did in 2008. It’s the battle of the boring election cycle. It’s about 50/50 out there, time for the campaigns to get disparate.
I don’t want to even guess results on Nov. 6th and early voting has started.
“The federal reserve controls short-term interest rates through buying and selling Treasury notes.”
I thought this is how they push on long term rates. They do not “control” long term rates directly.
Short term rates they directly control by setting the intra bank over night lending rate.
Please school me if I got wrong.
The way the Fed sets the intra-bank rate is through purchase or sale of Treasury Bills.
Thanks for the schooling. Learned something new. Sounds like the fed will need to sell LOTS of notes once they raise rates both at the long and short ends. Congress will love that.
Or just leave rates near 0 forever, and take the easy way out.
“Diana Olick
Consumer confidence is way up, but those that plan to buy a home within 6 months fell. ”
The economy is so good that no one wants to purchase a house.
Printing our way to prosperity.
Goldman: Fed’s QE3 could hit $2 trillion
NEW YORK (CNNMoney) — The Federal Reserve’s QE3 bond buying program announced earlier this month could last until the middle of 2015 and eventually reach $2 trillion, according to an estimate from economists at Goldman Sachs.
The Goldman economists also wrote in a report that they believe the Fed will not raise the federal funds rate until 2016. This rate, which is used as a benchmark for a wide variety of consumer and business loans, has been near 0% since December 2008. The Fed said in its last statement that it expected rates would remain low until mid-2015.
The Fed announced earlier this month that it would buy $40 billion a month in mortgages for the foreseeable future, a plan that has been dubbed QE3 since it is the central bank’s third round of quantitative easing. The Fed hopes that by pumping money into the economy lowering mortgage rates, QE3 could lead to more consumer spending and more hiring by businesses.
Goldman’s $2 trillion estimate also includes the buying of long-term Treasuries planned by the Fed under an extension of what is popularly known “Operation Twist.” In that program, the Fed is selling short-term Treasuries to fund those purchases.
The Goldman economists also said they think the Fed wants to see the nation’s unemployment rate in the 7% to 7.5% range before it ends its bond purchases, and in the 6.5% to 7% range before it starts raising interest rates again. Unemployment stood at 8.1% in August, down from 8.3% in July. But much of the most recent decline was due to job seekers, particularly young adults, dropping out of the labor force as opposed to a pick-up in hiring.
Fed’s Williams sees expanded QE3 in 2013, end by 2014
(Reuters) – Offering one of the clearest road maps yet for the Federal Reserve’s latest monetary stimulus, John Williams, a top Fed policy maker, said on Monday he expects the central bank to expand its bond-buying program next year and end it before the close of 2014.
Williams, president of the San Francisco Fed, said that because it will take more than a few months for the U.S. central bank’s latest round of bond-buying to drive down the high unemployment rate, there is good cause to ratchet up the Fed’s already aggressive measures.
The Fed began buying $40 billion a month in mortgage-backed securities this month and has pledged to continue the purchases until the labor market has improved substantially. The program is called QE3 because it is the Fed’s third try at quantitative easing, or buying bonds to stimulate the economy.
The Fed is also buying $45 billion in long-term Treasuries each month and selling a like amount of short-term Treasuries in a program known as Operation Twist, which is also designed to lower long-term borrowing costs, such as mortgages. Twist is set to expire at the end of the year.
Because unemployment will likely have budged little from its current 8.1 percent level by that time, Williams said, “a strong case could be made” for continuing the current level of mortgage-backed securities purchases and expanding into Treasuries purchases once Twist expires.
What QE3 should do, he said, is push down borrowing costs, making the purchase of new cars cheaper, for example, which in turn will boost sales and, eventually, prompt factories to hire new workers.
“This is exactly the kind of virtuous circle that provides the oomph in a healthy economic recovery,” Williams said in a speech to the City Club of San Francisco.
He predicted the jobless rate will drop to 7.25 percent by the end of 2014, a level that he said fits the Fed’s definition of a “substantially” improved job market.
“I would think that we would be stopping the asset purchases well before late 2014,” Williams told reporters after the speech.
Short-term interest rates, now near zero, will likely stay until at least mid-2015, he said, echoing the Fed’s own policy statement.
I keep hearing Realtors taking about pent up demand…
http://www.bloomberg.com/news/2012-09-25/young-adults-flock-to-parents-homes-amid-sour-economy.html
By Kathy Warbelow and Frank Bass – Sep 25, 2012 7:04 AM PT
The Class of 2008, born during the historic bull market that closed the past century, reached a dubious distinction last year: More than a million of the college graduates have gone back home.
The number of 26-year-olds living with parents has jumped almost 46 percent since 2007, according to Census Bureau data compiled by the University of Minnesota Population Center. Last year, the number of 18- to 30-year-olds living with their parents grew to 20.7 million, a 3.9 percent gain from 2010.
The figures underscore the difficulty that millions of young people have had in finding jobs and starting careers in the U.S. following the longest recession since the Great Depression. About a quarter of American adults between the ages of 18 and 30 now live with parents, while intergenerational households have reached the highest level in more than 50 years.
“There’s been a shift in attitude,” said Kate Brooks, the career services director at the University of Texas College of Liberal Arts. “Parents are more accepting; some welcome it.”
Reflecting on the changing circumstances among 20-something adults, many of whom backed Barack Obama’s presidential campaign in 2008, Republican vice presidential candidate Paul Ryan suggested some may have second thoughts this year. Not all young adults have “to live out their twenties in their childhood bedrooms, staring up at fading Obama posters and wondering when they can move out and get going with life,” he said at his party’s convention in Florida last month.
High Unemployment
The number of unemployed Americans has surged 60 percent to about 12.5 million from 7.82 million in the first quarter of 2008, according to data compiled by Bloomberg. The nation’s jobless rate, which peaked at 10 percent in October 2009, was 8.1 percent in August, compared with 5.1 percent in March 2008.
Kevin Sanchez graduated from the University of Texas at Austin in 2008 with a bachelors degree in journalism and no job. He moved back home to Edinburg, a South Texas city in the nation’s poorest metro area, centered on neighboring McAllen. He joined his parents, a grandmother and a younger sister.
After a month, his parents insisted that he get a job. Now Sanchez, 26, teaches speech communication at a middle school. During the past four years, he also earned a master’s degree in finance at the University of Texas-Pan American in Edinburg.
Sanchez supplements his teaching salary by freelancing for the local CBS Corp. television affiliate and is also helping with marketing for a relative’s home health-care business.
Boomerang Kids
Sanchez doesn’t pay any rent, although his father, a pharmacist, persuaded him to buy a house lot and to start saving. He also owns a truck and a Harley-Davidson motorcycle.
“He lives here and sleeps here and eats here when it’s convenient,” said his mother, Velva. “He comes and goes as he pleases.”
For Andrew Schrage, a 2008 Brown University graduate, returning to his parents’ Boston home was a matter of choice, not necessity. The 26-year-old co-owner of Moneycrashers.com, a Denver-based personal-finance website, was an adolescent when the bursting dot-com bubble ended an 18-year bull market marked by an almost 15-fold gain in the Standard & Poor’s 500 Index.
“I enjoy spending time with my parents and want to do so as much as possible, especially while they are younger,” Schrage said by e-mail. He helps them with household bills and chores.
The Downside
“I don’t have as much privacy as I’d like,” Schrage said on the downside of his living arrangements. “My parents like to make comments about lots of ‘little things,’ which can really get on my nerves.”
About a third of adults 18 to 34 who live with a parent said the move has been good for the relationship, according to a March report by the Pew Research Center’s Social and Demographic Trends Project in Washington. Only 18 percent said the move had caused relationships with their parents to deteriorate.
More than 60 percent of adults 25 to 34 know friends or family members who have moved back with their parents in the past few years because of economic conditions, according to the Pew report. It cited a December telephone poll of 2,048 adults, with a margin of error of plus or minus 2.9 percentage points.
The share of Americans living in multigenerational households reached the highest level since the 1950s, after rising significantly over the past five years, according to Pew.
Comfortable Lifestyle
“Young adults have had record-high unemployment rates,” said Kim Parker, the Pew study’s author. “So many of them have either moved back home, or have never left.”
The proportion of all age groups between 18 and 30 years old living with a parent rose between 2007 and 2011, according to the Census Bureau’s Current Population Survey. The increases ranged from 3.6 percent for 19-year-olds to almost 48 percent for 26-year-olds. The ranks of 23- and 28-year-olds living with parents rose more than 25 percent during the five-year period.
Even so, there may be hope next year for Sanchez. The percentage of young adults living with their parents fell over the year for four age groups, led by an almost 16 percent drop among 27-year-olds.
“I’m 26 years old and haven’t grown up yet,” Sanchez said. “I’ve become so comfortable with the lifestyle I’ve been living.”
– Editors: Ted Bunker, Pete Young.
To contact the reporters on this story: Kathy Warbelow in Austin at kwarbelow@bloomberg.net; Frank Bass in New York at Fbass1@bloomberg.net.
To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net.
I do real estate part time, and I can tell you there is lots of pent up desire. People with what it takes to get a loan and buy, the pressure is not so great.
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