Millennials in the Housing Market

By
Managing Real Estate Broker with SI Real Estate Tampa

Millennials in the Housing Market

For those selling your home, you may have seen an influx in Generation Y, or “Millennial” buyers flocking to your open house in recent years. Yet, with the most recent U.S. Census confirming that Millennials have surpassed the Baby Boomers, it’s no surprise the number of Millennial home buyers is on the rise.

So what does this mean for the housing market? According to Realtor.org, “For the third straight year, the largest group of recent buyers were Millennials, who composed 35% of all buyers, more than the combined amount of younger and older Baby Boomers at 31%”.

Millennials are a new brand of home buyer. Contrary to previous generations, Millennials are delaying marriage and family to a later time in life. Whereas, home buying is at the forefront of their priorities. Seen as a smart investment, these young purchasers are seeking the stability and security of home ownership.

In most markets, Millennials are finding that renting is more expensive than buying - even after considering the fees and taxes associated with buying a home. By paying on a mortgage rather than monthly rent, they are not only saving money, but allowing for more flexibility in their lifestyle. As Casey Bond with GO Banking Rates states, “When you own your home, you can stay as long as you like. You can have pets. You can paint your living room hot pink.” There’s no worry of losing your security deposit or relying on someone else to maintain the property.

 

With special programs for first time home buyers, there is less stress associated with a down payment. By taking advantage of FHA backed loans, Energy Efficient Mortgage programs among many others, Millennials were able to finance their purchase with a median down payment of just 7 percent.

For those considering buying your first home, revisiting your finances, evaluating your housing needs and contacting a trusted Realtor will start you off in the direction!

Comments (4)

Steve Snyder
Private-Money-Loan.com - Los Angeles, CA
310-948-8585 |100% LTV | Stated | Private Money

That is really interesting. What's the source for this data? Last I heard they weren't buying at all.

Jul 12, 2016 05:41 AM
Michael J. Perry
KW Elite - Lancaster, PA
Lancaster, PA Relo Specialist

Someone just had a stat that was saying nearly 50% of 18-35ers were back home with Mom & Dad ???

Jul 12, 2016 07:13 AM
Cody Carmen

That stat was represented a bit poorly. 40ish percent are back home with mom and dad, which is technically the largest group of millenials. But the word most was used incorrectly. More Millenials are out on their home than at home if you combine renting, buying, and college. 

Jul 12, 2016 09:47 AM
Nibal Elsaadi
SI Real Estate Tampa - Tampa, FL

Realtor.org is a great source of information regarding Millennial buyers. Although their participation in the housing market was low in the past, their participation has increased as noted in recent studies provided by Realtor.org.

Considering the large number of people comprising the Gen Y population, it's not surprising that they are saturating the market. Although Gen Y or 'Millennials' range in ages from 18-35, the median age of the Millennial home buyer is 30. 

Michael, touching on your point about parental assistance, approximately 23% of these buyers did note financial assistance from family or friends to help with their down payment.

This is a good link for your review: http://www.realtor.org/reports/home-buyer-and-seller-generational-trends

We look forward to hearing your thoughts!

Jul 12, 2016 08:11 AM
Anonymous
China H.

Tiny houses has been a source of inspiration for these young buyers. You are correct and make valid points about this generation. They are indeed buying. They are not necessarily buying the traditional home, but they are buying homes that fit their lifestyles. It will be a fascinating trend to keep further watch on.

Jul 13, 2016 02:31 AM
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