Lawmakers studying changes in housing market

March 8, 2012 12:57:46 AM PST
The mortgage crisis is changing attitudes about home ownership. According to a new report state lawmakers are studying, the California housing market is changing and not just because of foreclosures.

Kyle Saavedra, 26, is part of the trend the Urban Land Institute is seeing in California: he doesn't want to own a house, an indication that perhaps the foreclosure crisis has changed attitudes.

"Definitely not my No. 1 priority; I'd rather go out and see the world and do whatever, have fun, not be tied down," Saavedra said.

In fact, homeownership is expected to drop to 1984 levels by 2020, to just 55 percent in California.

A Senate committee is looking at the state's housing market to see if it can meet the demands of future population growth.

"The suburban housing market just isn't there anymore; it used to be there," Urban Law Institute researcher Arthur Nelson said.

In presenting his report the lawmakers, Nelson noted Californians are increasingly wanting to rent in urban areas preferably somewhere they can walk to everything or take public transit and not need a car, suggesting it's more than just the foreclosure crisis changing attitudes.

"I'm seeing for the first time ever, that prospective buyers, especially younger home buyers are now internalizing the expectation of continued increasing gas prices," Nelson said. "We're looking at $8 per gallon of gasoline by 2020. That might be optimistic."

And if you think the housing attitudes are just a Gen X or Y mindset, think again. The California Association of Realtors say only one-third of homeowners who've sold their home are purchasing a new one. The vast majority is opting to rent instead.

Committee Chairman Mark DeSaulnier is disturbed by the trend and still sees homeownership as a model for community.

"If everyone in the community has bought into it, they've bought into the larger community, they come out for politics, they're more engaged," DeSaulnier said.

The point of the report is to make lawmakers aware of the rapidly shift housing market so that policies can help meet consumer demands.

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