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I’l admit it. I’m primarily a buy-and-hold guy. I’m buying for cash flow right now, but my long-term goal is 20 good solid single family houses, free and clear, that I can hold for income and growth forever.
One thing I’m concerned about, long term, is the impact of demographics. We’re an aging population, barely having enough kids to form new households. On top of that, (this is not meant to be a political discussion) traditional marriage as defined by the nuclear family is threatened. My gut tells me that as the growth of one-parent families and childless families continues to expand, we will have less of a societal demand for the traditional 3 bedroom, 2 bath house in a subdivision.
I have been thinking about this in the back of my mind, even before reading this article on Seeking Alpha. (PLEASE, I don’t want this thread to devolve into a political rant – lets just deal with the demographics question)
http://seekingalpha.com/article/252720-housing-prices-and-demographics?source=dashboard_macro-view
Has anyone else been thinking about this? What do you think the long-term future hold for buy-and-hold strategies?
Hi Chris
I saw that article too and it is definitely politically motivated and like all political stuff tries to point blame at one party which is wrong since the whole government mechanism is responsible for the big mess we are in. Problem is, it is getting worse, not better which is further proof that the systems are broken
But, he but he does bring up some good points.
The answer to the questions cannot be a national answer. Real estate is local the answer will differ depending on YOUR demographic in YOUR backyard.
In my area, this is what we’re seeing:
According to the census in Texas, the population has increased about 30% since 2000. We are currently adding about 1,000 people a DAY because there is a good job market here. Plus we have no state income tax and affordable housing. That’s keeping our house prices and rents stable. There is still a HUGE problem with illegals invading the country. 40-50% of the student population in many areas are illegals. 51% of the population in Texas is hispanic ( some legal some not)
In the bigger cities, like Dallas, Houston, San Antonio there is still a demand for the typical 3/2/2 brick home that is well located close to jobs and good schools.
IN Austin, the population is much younger than the rest of the state and there is more of a demand for a 2/2 with a SMALL yard because folks there don’t want to spend the weekend doing yard work. zero lot line homes are popular.
Condos are NOT popular anywhere in TExas. Mostly because people don’t want to pay high HOA fees and it’s not much better than living in an apartment.
An interesting dynamic that I’m seeing is a huge migration away from the big cities and in to the rural areas. This is especially popular with retirees ( 70 million baby boomers) but increasing interest from those who think there will be HUGE ECONOMIC COLLAPSE and want to have a safe place to live where they can grow their own food and have some chickens. Interestingly, these are all cash buyers!
So, the answer is, it depends.
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