One of the most common misconceptions is that younger generations aren’t interested in homeownership. A lot of people point to the fact that millennials put off purchasing their first home as a reason for this belief.

Odeta Kushi, Deputy Chief Economist for First American, explains why millennials have put off certain milestones linked to homeownership. Those delays led to their homeownership rates trailing slightly behind older generations:

“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.”

Therefore, it’s partially true that some millennials have waited on homeownership to focus on other things in their lives – which is impacting certain housing market trends.

Data from the National Association of Realtors (NAR) indicates the average age of a first-time homebuyer is higher today than it’s ever been for the past 40 years. As shown on the graph below, homebuyers today are purchasing their first home an average of 4 years later than people in the 1980s and early 1990s:

However, just because millennials are hitting certain milestones later in life doesn’t necessarily mean that they’re not interested in becoming homeowners. The recent U.S. Census reveals a significant increase in homeownership rates for millennials and other young homebuyers.

See the graph above, millennials are entering the market in full force, plus their share of the market is growing. From the data itself, the belief that younger generations don’t want to buy homes is a misconception. The recent Capital Market Outlook report from Merrill-Lynch in fact, further drives home this point, 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 is following the trend of millennial homeownership and puts it more simply, saying:

“. . . it’s clear that younger households (millennials!) are driving homeownership growth.”

Being the largest generation, millennials’ impact on the market is growing as more and more people from that generation reach homebuying age – and Generation Z isn’t far behind, either. This means younger generations will likely continue to drive demand in the housing market for years to come.

Bottom Line

Are you a member of a younger generation and interested in purchasing a home? You are not alone. A lot of your peers are on their path to homeownership, too. Talk to My Tampa Agent and discuss what you can do to accomplish your homebuying goals.

Thinking of Buying or Selling a Home?

Talk TO US!