More Young People Are Buying Homes

<article class="post-10319 post type-post status-publish format-standard has-post-thumbnail hentry" id="post-10319"><span class="entry-date">August 19, 2021</span><div class="entry-header center-block text-center"><h1 class="entry-title">More Young People Are Buying Homes</h1><div class="shareBlock"><div class="shareTitle">Share</div><div class="shareIcons"><a aria-label="Twitter Share Link" class="twitter solid display-inline-block" data-tracking="Post,Social Post Link Clicked,Twitter" href="http://twitter.com/share?text=More+Young+People+Are+Buying+Homes&amp;url=https%3A%2F%2Fgilliggroup.com%2Fblog%2Fmore-young-people-are-buying-homes%2F" target="_blank"><span class="force-hidden">Twitter</span></a>
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<p><img alt="More Young People Are Buying Homes | Simplifying The Market" class="webfeedsFeaturedVisual wp-post-image" decoding="async" link_thumbnail="" loading="lazy" sizes="auto, (max-width: 549px) 100vw, 549px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104737/20210819-KCM-Share-549×300.jpg" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104737/20210819-KCM-Share-549×300.jpg 549w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104737/20210819-KCM-Share.jpg 750w" style="display: block; margin-bottom: 5px; clear:both;max-width: 100%;" width="358"/></p>
<p>There’s a common misconception that younger generations aren’t interested in homeownership. Many people point to the fact that millennials put off purchasing their first home as a reason for this belief.<span id="more-44975"></span></p>
<p>Odeta Kushi, Deputy Chief Economist for <em>First American</em>, <a href="https://blog.firstam.com/economics/pandemic-accelerated-roaring-20s-of-millennial-homeownership-demand">explains</a> why millennials have put off certain milestones linked to homeownership. Those delays led to their homeownership rates trailing slightly behind older generations:</p>
<blockquote>
<p><em>“<strong>Historically, millennials have delayed the critical lifestyle choices often</strong> <strong>linked to buying a first home, </strong>including getting married and having children, in order to further their education<strong>. This is clear in cross-generational comparisons of homeownership rates which show millennials lagging their generational predecessors.”</strong></em></p>
</blockquote>
<p>So, it’s partially true that <strong>some millennials <em>have waited </em>on</strong> <a href="https://www.simplifyingthemarket.com/2021/07/07/the-truths-young-homebuyers-need-to-hear/?a=712984-fa409495d5d70154d03a25e81e9540e2"><strong>homeownership</strong></a><strong> to focus on other things in their lives</strong> – and that’s impacting certain housing market trends.</p>
<p>Data from the <a href="https://www.nar.realtor/newsroom/pandemic-caused-buyers-to-seek-multi-generational-homes-sellers-to-sell-faster"><em>National Association of Realtors</em></a> (NAR) indicates <strong>the average age of a first-time homebuyer is higher today than it’s been over the past 40 years</strong>. As the graph below shows, homebuyers today are purchasing their first home<strong> an average of</strong> <strong>4 years later </strong>than people in the 1980s and early 1990s:<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104739/20210819-MEM-Eng-1.png"><img alt="More Young People Are Buying Homes | Simplifying The Market" class="aligncenter wp-image-44978" decoding="async" height="488" loading="lazy" sizes="auto, (max-width: 650px) 100vw, 650px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104739/20210819-MEM-Eng-1.png" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104739/20210819-MEM-Eng-1.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104739/20210819-MEM-Eng-1-400×300.png 400w" width="650"/></a>But just because millennials are hitting certain milestones later in life <strong>doesn’t mean they’re not interested in becoming homeowners</strong>. The recent <a href="https://www.census.gov/housing/hvs/files/currenthvspress.pdf">U.S. Census</a> reveals a significant <strong>increase in </strong><a href="https://www.simplifyingthemarket.com/2021/02/11/47-of-new-buyers-surprised-by-how-affordable-homes-are-today/?a=712984-fa409495d5d70154d03a25e81e9540e2"><strong>homeownership rates</strong></a><strong> for millennials and other young homebuyers</strong>.<a href="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104741/20210819-MEM-Eng-2.png"><img alt="More Young People Are Buying Homes | Simplifying The Market" class="aligncenter wp-image-44979" decoding="async" height="488" loading="lazy" sizes="auto, (max-width: 650px) 100vw, 650px" src="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104741/20210819-MEM-Eng-2.png" srcset="https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104741/20210819-MEM-Eng-2.png 1000w, https://files.simplifyingthemarket.com/wp-content/uploads/2021/08/18104741/20210819-MEM-Eng-2-400×300.png 400w" width="650"/></a>As the graph above shows, millennials are entering the market in full force, and their share of the market is growing. Based on the data, <strong>the belief that younger generations don’t want to buy homes is a misconception. </strong>In fact, the recent <a href="https://olui2.fs.ml.com/Publish/Content/application/pdf/GWMOL/CMO_4-26-21_Merrill.pdf"><em>Capital Market Outlook</em></a> report from <em>Merrill-Lynch</em> further drives home this point, as it specifically mentions the effect millennials are having on demand:</p>
<blockquote>
<p><em>“Demand is very strong because the <strong>biggest demographic cohort in history is moving through the household-formation and peak home-buying stages of its life cycle</strong>.”</em></p>
</blockquote>
<p>Kushi is following the trend of millennial homeownership and puts it more simply, <a href="https://twitter.com/odetakushi/status/1420030874872074252">saying</a>:</p>
<blockquote>
<p><em>“. . . <strong>it’s clear that younger households (millennials!) are driving homeownership growth</strong>.”</em></p>
</blockquote>
<p>As 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. That means younger generations will likely continue to <a href="https://www.simplifyingthemarket.com/2021/07/15/diving-deep-into-todays-biggest-buyer-concerns/?a=712984-fa409495d5d70154d03a25e81e9540e2">drive demand</a> in the housing market for years to come.</p>
<h3><strong>Bottom Line</strong></h3>
<p>If you’re a member of a younger generation and interested in purchasing a home, you’re not <a href="https://www.simplifyingthemarket.com/2021/06/25/homebuyers-hang-in-there-infographic/?a=712984-fa409495d5d70154d03a25e81e9540e2">alone</a>. Many of your peers are on their path to homeownership, too. Let’s connect today and discuss what you can do to accomplish your <a href="https://www.simplifyingthemarket.com/2021/08/02/key-questions-to-ask-yourself-before-buying-a-home/?a=712984-fa409495d5d70154d03a25e81e9540e2">homebuying goals</a>.</p>
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