According to the 2016 National Association of Realtors® Home Buyer and Seller Generational Trends study, millennials are the largest group of homebuyers for the third year running. So what does this new generation of homebuyers look like?
They earn a good living.
The median income of millennial homebuyers in this year’s survey was more than $77K. They also carry less student loan debt than Gen-X buyers, giving them greater buying power.
Lawrence Yun, NAR chief economist, says, “One of the many reasons housing supply has been subdued in recent years may be because a segment of homeowners have decided to delay trading up or moving down in order to pay down their debt, including from student loans.”
They are redefining home ownership.
Millennials are dispelling the notion that young marrieds are the only ones flocking to the suburbs. In fact, 12% of millennial buyers are unmarried couples and 20% of buyers are single females.
They are buying more expensive homes in the suburbs.
On average, millennials are buying homes that are 1,720-square foot and cost $187,400 ($180,900 a year ago). The study also found that the number of millennials buying in an urban or central city area decreased to 17% (21% a year ago).
They value community and proximity.
The survey indicates that neighborhood quality and the convenience to their workplace were millennial’s largest influences when choosing a suburban community.
Shannon Kutchek, a REALTOR® with Smothers Realty Group in suburban La Grange, IL, says “Most of my millennial clients are interested in moving to suburbs that have a core downtown, with shopping, restaurants and entertainment. They also look for homes that are close to the train station so they can easily commute to the city for work.”
They want older homes.
The NAR generational survey indicates that the younger the buyer, the older the home they buy is.
Kelly Schoeff, a REALTOR® with Coldwell Banker in the Chicago Western Suburbs, has noticed this trend as well. “Millennials are looking for an affordable single family home and they are willing to put in the time and work that older houses require. My other clients are more interested in a new home, or a home that has undergone enough renovation that it is in like-new condition. They are ready to say goodbye to their starter homes and the millennials are interested in buying them.”
They prefer to search online, than in person.
While 87% of millennial buyers work with a REALTOR® they aren’t too excited about attending open houses as their Gen-X counterparts. The survey indicates that millennials are also more likely to use mobile and tablet applications or search engines when house hunting.