The first wave of homeowners who lost their home to foreclosure or short sale during the foreclosure crisis are now past the seven-year window: millions more are expected to follow.
The first wave of 7.3 million homeowners who lost their home to foreclosure or short sale during the foreclosure crisis in 2015 are now past the seven-year window they conservatively need to repair their credit and qualify to buy a home, according to RealtyTrac. More waves of these potential boomerang buyers will be moving past that seven-year window over the next eight years corresponding to the eight years of above historically normal foreclosure activity from 2007 to 2014.
While millennials have gotten a lot of attention lately as the generation whose below-normal homeownership rates are changing the landscape of the U.S. real estate market, the boomerang buyers — who are primarily Generation Xers or Baby Boomers — represent a massive wave of potential pent-up demand that could shape the housing market in the short term even more dramatically. U.S. Census data shows home ownership rates for those ages 35 to 44 — roughly Generation X — were 11% below historical averages going back to 1994 in the third quarter of 2013, while home ownership rates for the below age 35 cohort were 10% below historical averages.
RealtyTrac analyzed foreclosure, affordability and demographic data to provide predictions of when and where these boomerang buyers are most likely to materialize. Nearly 7.3 million potential boomerang buyers nationwide will be in a position to buy again from a credit repair perspective over the next eight years, according to RealtyTrac. Here’s how those emerging boomerang buyers break down by year.
