November 23, 2018
Millennials Are Buying Homes—But Why Are Their Numbers Relatively Low for Their Ages?
We’ve mentioned it before, and it’s worth mentioning again: contrary to the odd stereotypes attached to them, Americans of the Millennial generation are buying homes. Indeed, they are making purchases at rates higher than any other age-set at the moment, having at last come of age to do so; and it is estimated that in the coming decade the number of people in their thirties will increase by more than 4 million.
But it also must be said: according to a recent Fannie Mac report examining demographic trends from 2000-2016, there has been an 8% decrease in rate of homeownership among this under-35 age-set since the market’s height in 2004 (when it was the Late Boomers and Gen Xers who were doing the buying), and this rate is the equivalent of about 3% below the historical average.
It appears that there are a number of reasons for this trend. For example, members of this cohort are also seeing a lower marriage rate than their forerunners (due to various cultural pressures) and having fewer children later in life. They also entered young adulthood under the cloud of the “Great Recession,” when foreclosures were rampant and the air was thick with discussion of people having bought homes for a great deal more than they turned out to be worth after the market over-corrected in 2008. And then, of course, there is their burden of student loan debt, which is higher by percentage than experienced by any previous generation, and seems likely to stifle their economic activity for years to come.
Meanwhile, the housing market has in recent days been fairly positive, even despite ups and downs in the marketplace, which has heightened the cost to purchase. Fannie Mac reckons this to be the reason for up to half of the decline.
It’s something of a perfect storm for putting off homeownership for Millennials; but we feel confident that, given a few extra years, they’ll come around.
When looking for a closing attorney in Jacksonville, Florida; Rockport, Massachusetts; or Cumberland, Rhode Island, Millennials would be well-served to contact us to see how we can help. Topouzis & Associates, P.C., performs title searches and provides title insurance backed by multiple underwriters. We’re staffed by residential real estate specialists and ready to help avoid costly delays and streamline residential transactions.