There's a significant change in attitudes towards home ownership in the U.S. 

For years, owning a home was a dream that a vast majority of people strived for. It was seen as a place to live, raise a family, and create lasting memories.

Times have changed. Andrew Lanoie of Four Peaks Capital Partners says, "People are now choosing to rent living space over purchasing a home of their own. Whether or not this is a positive direction or not for Americans should not matter, but realize that profitability can be attained."

In 2004…

• 70% of the population owned a home with the middle-aged and older being the primary owners.
• Homeownership was also affordable for younger Americans.

By 2017…

• 63% of the population owned a home. The last time the percentage of homeownership hit this low was back in 1965.
• Homeownership is no longer affordable for the middle-aged and older, but also for younger Americans.

Why has this happened?

There are several major reasons why there has been a significant drop in homeownership over the last decade and a half.

Cost. The value of residential real estate has continued to increase, but people no longer have the money to invest in a home.

Down Payment. The continued increase in real estate value means that larger down payments are required upfront in order to have a reasonable monthly mortgage payment. If you are struggling to cover the cost of basic daily expenses with your current paycheck, factoring in a mortgage and down payment are out of the question.

Value Shift. Once upon a time, owning a home was the American dream. Nowadays, the American dream has shifted to other priorities. People are now choosing to spend their money elsewhere and have decided that the monthly expenditures and maintenance for the upkeep of a home are best left up to someone else and renting removes those additional burdens.

YOUR INVESTMENT PORTFOLIO

At this point, you may think that this trend is the potential for a problem. It may be for builders and real estate agents, but for the investor, it opens the door for the perfect opportunity. Everyone needs to live somewhere. If people are not buying homes, then they are generally renting a home, an apartment, a condominium, etc.

This means that there is always value in real estate and money to be made by those renting out these living spaces. With this being said, you should be realigning your investment focus on property rentals.

As to the value of owning a rental property, it is a tangible asset that will always maintain value, even when inflation is on the rise. It’s a very safe investment for someone just starting out.

THE REAL ESTATE CLASS

When you think about real estate, mobile home parks don’t generally come to mind first, but believe it or not, they are one of the best-hidden gems in real estate investments. During the downturn in 2008, they were not affected and their yields were above-average.

As for mobile home park tenants:

• They are stable and move less.
• They do not downsize.
  
  

While the gross rental income for investment properties such as apartments and single-family homes may be higher, they will be one of the first expenses that tenants will address if the economy takes a downturn. If this happens, an investment property could become a long-term non-performing investment due to tenant vacancy.

Social class highs and lows are generally not an issue among tenants in mobile home parks. They provide a stable and affordable living option for many people. Andrew Lanoie suggests, "By investing in affordable rental property, you are investing on a smaller scale, but shielding yourself from the risk that is associated with economic volatility."

Regardless of the current state of the economy, everyone needs a place to live. Why not stay ahead of the game and invest in a real estate class that providing for those families that look for affordable housing?