Millennials, also sometimes referred to as generation Y, are those born between the early 1980s and the late 1990s. In the category of homeowners, this would put them in the late 20s to early 30s.
This generation had different factors that impacted them during their years growing up and while in college, which has influenced their home buying decisions. Some of these factors could be the affluence of their parents (when compared to previous generations), the higher cost of education which led to higher student loans and debts, high prices in housing, a less-than-stable economic condition, increased use of technology, the introduction of the Internet, the prevalence of social media, etc.
Also, the sheer number of Millennials is predicted to have a great impact on the housing market. They already make up 32% of home buyers, which makes for the largest share in this category. This generation also leads all others when it comes to being first time home buyers, at 68%.
The Millennials also show differences from other generations in many ways, such as how they search for a home, the factors that are important to them when buying a home, how long they spend in searching for a home, how they choose an agent, how they finance the home, the sources they use to finance the home, their household income, whether they are married, single, or unmarried couple when buying a home, what kind of home they purchase (old/new/multigenerational, etc.), as well as reasons for buying a home.
Here are 12 facts about millennial home buyers which are unique to this demographic. They show the way Millennials think and decide when it comes to buying homes for the first time or for subsequent times. It also shows what sets them apart from the other generations:
12. Millennials look at a home as an investment, more than a place they are going to put down roots and spend a lifetime in. They also look to making increasing their credibility with the bank via improving their credit score. This leads them to own homes for much shorter periods of time when compared to previous generations as they renovate it and sell it as soon as they think they will make a profit on it. This is causing quicker turnarounds in the housing market.
11. Millennials place more importance on home ownership than marriage. They are delaying certain life choices in favor of others. So while marriage and parenthood can wait, buying a home cannot. Many Millennials take the practical decision of using their hard-earned money to pay for a home, rather than to pay for a lavish wedding.
10. The main motivation for Millennials to buy a home of their own was just a simple desire to own their own home. Their timing to buy the home was also influenced just by their desire and the right timing to act on it.
9. Millennials who chose to buy new homes did so in order to avoid the cost of expensive renovations or repairs.
8. Millennials are more likely to buy homes that were previously owned or older homes. They chose to buy homes that were previously owned because they got a better price on it than a new home, and also because they felt it had more charm and value than a brand new home.