Who’s buying homes these days? According to a study by Zillow Group, it’s mostly millennials.
Stats on Millennial Home Buyers
In 2016, 42% of home buyers in the United States were part of Generation Y, also known as the millennial generation. Most of them were newcomers to the housing market. The median age of a first-time home buyer is now 33 years old.
What may surprise you is the choices these buyers are making when it comes to buying a home. There is much ado in the media about millennial spending habits, and not a week goes by without a clickbait-y news story about some wild millennial fad (most recently, it was avocado toast). Unfortunately, this has created a widespread a perception that people aged 18 to 34 are bad with money.
Are Millennial Home Buyers Irresponsible?
So is this generation as careless when it comes to buying a house? Not so, according to Zillow. Truth is, millennial home buyers take after their grandparents.
Zillow studied millennial home buying trends and found that this generation shares many preferences with their grandparents’ generation. Their choices set them apart from their parents’ generation (the baby boomers) and the now middle-aged Generation X.
Here are some stereotype-busting truths about millennial home buyers:
- Contrary to the popular image of millennials as city-dwelling hipsters, almost 50% of millennial homeowners live in the suburbs. Only 33% live in urban areas. 20% live in a rural area.
- Commitment issues is another trait of the stereotypical millennial. This generation is often seen as one that is willing to lay down roots. But the study showed that 64% of millennial home buyers chose to buy in the same city they already lived in. Of those two didn’t, just 7% left their home state.
- Critics of the millennial generation like to claim that this cohort craves instant gratification. You would think, then, that this generation is eager to run out and buy the first home they can afford. In truth, millennial home buyers skip the traditional starter home and wait to invest in larger properties with higher prices. The median size of a millennial home is 1,800 square feet, similar in size to what older generations buy.
- Finally, millennials are often portrayed as being self-centred, preferring to text their friends instead of talking with neighbours in the check-out line. But like their grandparents’ generation, millennials are opting for homes with shared community amenities. They are also more open to choosing townhouses over detached homes than baby boomers or Generation X.
No generation is perfect. We’re not saying that millennials make better or worse choices than their parents did when it comes to buying a home. But it’s interesting to note how their habits differ, and it’s fair to say the current crop of home buyers is far from the fair weather purchasers the media tends to portray.