Numerous people agree that our younger generation isn’t interested in purchasing their first home. This is due to the fact that many millennials have been putting off purchasing a home.
Odeta Kushi, Deputy Chief Economist for First American, explains: “Historically, millennials have delayed the critical lifestyle choices often linked to buying a first home, including getting married and having children, in order to further their education. This is clear in cross-generational comparisons of homeownership rates which show millennials lagging their generational predecessors.”
Some millennials haven’t purchased a home to focus on other things in their lives. This is impacting certain trends of the housing market.
The National Association of Realtors (NAR) says the average age of a first-time homebuyer is higher today than it’s been over the past 40 years. The graph we share below shows that homebuyers today are buying their first home on an average of 4 years later than those in the 1980’s and early 1990’s:
Millennials are hitting big milestones later in their life than the older generations. This doesn’t mean they aren’t interested in hitting these milestones, like becoming a homeowner. The recent U.S. Census reveals a significant increase in homeownership rates for millennials and other young homebuyers.
As shown in the graph above, millennials are indeed entering the housing market. More millennials are going to start buying homes as the years go on, if they haven’t already. It is a misconception that the younger generations don’t want to buy a home. A recent Capital Market Outlook report from Merrill-Lynch further drives this point home, as it specifically mentions the effect millennials are having on demand:
“Demand is very strong because the biggest demographic cohort in history is moving through the household-formation and peak home-buying stages of its life cycle.”
Kushi adds the following quote about millennial homeownership:
“...it’s clear that younger households (millennials!) are driving homeownership growth.”
Millennials are the largest generation and they have made a strong impact on the real estate market as they start to hit the homebuying age. Generation Z isn’t far behind. This shows that the younger generation will likely continue to drive demand in the housing market in the future.
Are you a member of the younger generation and interested in purchasing a home? You aren’t alone! Many people in your generation are in the same stage of life. Here at Apex Home Loans, we have a lot of great resources available to first-time homebuyers and we are happy to walk you through each step. Connect with our team today to get started on your homebuying journey!
Topics: Real Estate, Mortgages, Millenials, Home Prices, First Time Homebuyer, Housing Market, Homeownership Rates, Home Buyers, millennial homebuyers, Mortgages for Millennials, Pandemic Home Buying, Pandemic Housing Prices