Author and demographer William Frey, who wrote the 2014 book Diversity Explosion, noted that the rate of growth among currently minority populations such as Asians, Hispanics, and mixed-race conclaves is such that these communities would be twice as numerous by 2050. Accompanying this dramatic change is the rise of a definable, financially powerful black middle class.
“They need to look at the national growth patterns where the minority population is growing much more dramatically than the white population. I think the housing industry knows this to some degree, but if they don’t, they should realize that it represents the future of housing in the United States,” Frey told How Housing Matters, as quoted by Urban Land Magazine.
Frey emphasized that these developments would necessitate an evolution on the housing industry’s part to ensure that it would be able to accommodate the needs of these populations, and to allow them to participate in the housing market.
“Housing will need to be made appropriate for these populations. Their particular preferences and tastes may be for multigenerational housing or particular kinds of communities. Huge amounts of attention were given to the baby boomers when it was learned that they were an important market. That same kind of focus needs to be given to these young, more diverse folks,” Frey said.
Most importantly, Frey said that the environment in which the future real estate industry would operate should ensure that people can finance their homes in the first place—an effort that would require major steps not just from the housing sector, but also from financial institutions and the government.
“Being able to buy a house will be critically important because that will be a huge part of people’s future wealth and allow them to create future wealth for their children,” Frey said.
The housing industry in the United States is set to experience radical changes that would be fueled by a major demographic shift within a few decades, according to a renowned demographic expert.