Nationwide Uptick in Millennials Buying Homes
Millennials—ages spanning 24 to 41—want to chase the dream of homeownership as much as any generation before them. They realize how paying rent month-after-month is like throwing their money away with little to show for it long-term. The difference is the millennial generation have more obstacles to navigate that weren’t present for their parents or grandparents. The Boomer generation—ages spanning 51 to 72—came into a market that was house plenty and included the best of jobs, housing, and overall opportunities. The millennials look to what their grandparents had and want the same but will have to work much harder and for a longer time to come close—many will need additional financial help.
Millennials have grown up incredibly sophisticated, technology wise, and immune to most traditional marketing and sales pitches because they’ve seen it all since early childhood. This group recognizes the importance and push of higher education. On average, according to an American Student Assistance survey, this particular generation carries more than $70,000 in student load debt. This high debt places them into the housing market at a later average age which also influences the age of marriage and beginning a family.
While these delays show record low rate in homeownership for this age group there is a recognizable shift indicating millennials are getting back into the game. The good news is nationwide economists have noticed a small uptick for two-straight quarters in late 2017 for real estate buying for this age group—the country’s largest age-group. Homeownership for 24- to 41-year-olds is increasing as long as the housing inventory is available and priced in their range of affordability.
What’s holding Millennials back from entering the real estate market?
There are several barriers blocking the way to homeownership for millennials.
As this generation is ready to enter the housing market they are finding limited inventory in their price range and on their time frame. Why? According to a survey by Realtor.com, homeownership among Boomers holds steady at 78 percent—nearly twice as high as Millennials at 41 percent. In the past the cycle of home turnovers would progress from the grandparent’s generation to keep the cycle flowing.
Additionally, builders all over the country have been shying away from the more affordable homes Millennials favor. BUILDER TIP: When you plan your next new-construction build keep these prospective buyers in mind who are ready to jump into homeownership.
The reality is economic factors are delaying house purchases from seven to ten years due to the higher debt being carried by this group—much attributed to education loans. The survey further reveals 29 percent of younger Buyers report getting financial help from family and friends to make a down payment and 31 percent collect funds from multiple sources. Millennials who can save for a down payment (only 39 percent) or who qualify for a mortgage loan (just 52 percent) appear to be choosing more traditional houses in the suburbs over renting or buying in city centers.
The housing market can be competitive for first-time buyers searching for their starter home. Our team is committed to keeping current with the market. Let us be your guide by scheduling an appointment today.
Cherin Cox is a native Houstonian who first recognized her passion for real estate while working for one of Houston’s top producing Realtors in the mid-1990s. In 2000, she successfully received her Texas Real Estate license and began her full time real estate career. Cherin approaches each transaction with dedication, integrity, a sense of humor, and the skills to work in partnership with her clients, ensuring each one is as prepared as they can be for the current market. She specializes in residential sales, luxury homes, and both domestic and international relocation. When it’s time to buy, sell, or relocate speak with a trusted professional knowledgeable in the homes of the Houston Districts and neighborhoods. Have your home staged? As a professional home stager, Cherin offers this service to clients as a benefit of doing business. Be sure to ask Cherin about home staging for your home.