The Millennial Home Buying Trend
The largest consumer demographic today is that of the millennials, thus their spending habits are key
not only to the future of the world economy, but the future of the world housing market as well. As
millennials shift towards buying homes later and later it has some economists and realtors worried
about the future, what happens if millennials rent forever, or buy well into their 30s or 40s thus only
purchasing one home in their lives? Millennials are purchasing homes later due to a number of factors
both cultural and economic, from marrying and settling down to pursuing a good paying job and paying
down debts. The combination of these factors is what is causing millennials to purchase homes later
than ever, and putting some in the world of economics on edge.
A major factor in the delay of home buying amongst millennials is a cultural shift that is really a
combination of many different things, not all of which have to do with home buying directly. Rather,
many of the factors have to do with millennials and their desire to settle down later in life. This desire to
begin the domestic life later than previous generations has pushed back everything from getting married
and having kids to settling on a job and on a “home base” in which to live.
The first factor that affects millennial home buying is the fact that millennials are getting
married and having kids much later than previous generations. For baby boomers, the average age to
get married was 21-23, while for millennials today the average age is 27-29. (Barkhorn) Getting married
and starting a family is one of the biggest catalysts to buying a home so by doing that later it also pushes
back the purchase of a first home. Before doing this project, there hadn’t been much thought as to what
factors go into purchasing a house, but we heard from both a millennial who has yet to purchase a
house as well as a real estate agent that the biggest catalyst is starting a family. (Coonan and
Duckworth) Along with the statistic of first marriage the age of having a child has also been pushed back,
from 21.4 years old in 1970 to 26 in 2014. (Sifferlin) The combination of these two factors has greatly
increased the age at which people begin to become domestic and begin to think about settling down
and buying a house.
Another factor in the delay in millennial home buying is education, as millennials are more likely
to go to college and some type of grad school than any previous generation. While this has financial
impacts, of course, as far as student loans and extra years of no income, it also has an impact on
millennial culture. Talking to Maura Coonan who works at the UST libraries, she attended grad school, as
did many of her friends, because there were simply no jobs available so they figured it would be easier
to find a job with more education. This choice to continue on in schooling is thus another factor for
millennial home buyers because it forces them to wait longer to settle down with a job and a family, as
they are simply farther behind in the process at that age than previous generations. In previous
generations one didn’t need a college degree to get a good paying job and many women didn’t even go
to college as their role was to be a wife and mother. With this progression in women’s roles in the
workplace many women are simply choosing to settle down later and delay marriage and kids to focus
on their careers.
Overall the major shift in millennial culture to do with home buying which we learned from
realtor Mr. Duckworth is millennials simply want to live life and be free before being tied down to a
home and a 30-year mortgage. It is not that millennials don’t want to or don’t plan to buy, its just that
they want the perfect career in the perfect place after having a lot of life experiences before settling
down. A study by Realtor Magazine found that nearly 3 out of 4 millennial renters (74%) plan to buy a
home in the future. (Woo) So while millennials may not be buying homes at the same time or rate as
previous generations, the millennial purchasing boom is coming, and many could argue that it has
already arrived. The US housing market has seen an unprecedented shortage of housing for buyers and
offers on these homes can quickly climb above the asking price with upwards of 10 or more offers.
(Duckworth)
With all of the changes in millennial buying habits we did find that there are some things that
haven’t changed between millennials and previous generations. Most millennials upon buying a home
prefer to be in the suburbs in a single family home, just as previous generations did the same. This
seems to come as a shock to many in the industry who predicted millennial home buyers would prefer
the amenities of the city and stay there, or the luxury of minimal maintenance that a townhome offers.
The other factors that affect millennial home buying trends the same way as other generations
are the desire for safety and access to a healthy job market. (Duckworth) These are many of the same
things that attracted their parents and grandparents to the suburbs, rather than living in the big city.
The other factors are the desire for privacy and more space, all indicative of millennials buying homes
due to marriage or having children. (Wedgeworth) These are many of the same factors that triggered
baby boomers and Gen Xers to the suburbs and are reasons that will continue to attract young families.
While it is easy to see a clear separation in the ages in which millennials are starting families and
purchasing homes the U.S. housing market can take solace in the fact that millennials are beginning to
buy and in huge numbers. While there has been delay due to education and a thirst for adventure,
millennials are beginning to settle down in homes. Also, while there are many differences between
