Millennials Stepping Up in the Homebuying Arena
We saw a lot of activity over the last year in the home purchase arena due to the coronavirus pandemic. Many families moved out of the metropolitan areas and into more rural and suburban environments because the spike in working from home became the "new normal". With that being said, the largest group that made waves in the purchase trends were Millennials and the data shows.
What the National Association of Realtors (NAR) found was that the there was an 37% growth in purchases with individuals within the Millennial age group, followed by an 18% growth with individuals aged 41-65. Many Millennials moved to remote work and a large percentage of this group were first-time homebuyers too!
For the 8th consecutive year, Millennials led the pack of home buyers.
So what does this all mean and what does this look like for the landscape of home buying? One of the first things that became a trend (and especially emphasized during the pandemic) was the ability to shorten or even eliminate the commute that was needed to get to work.
Another contributing factor to the rise in Millennial purchases was the ability to be closer to family and friends. Essentially, what the pandemic has taught us and especially younger families and homebuyers is that the ones that are closest to us shouldn't have to be far away when we have the ability to get closer to them. Sure, a Zoom call can mitigate the separation for a while but given the opportunity to move closer to families and friends the Millennial group took advantage of it this past year. This also was a factor in which neighborhoods were chosen in the process too.
Some Millennials lost out on the opportunity to grab their taste of homeownership because in the midst of the home buying boom, the inventory coupled with the high demand made it harder for purchases to happen for this group because they had to compete with other buyers that had a bit more capital to work with. While a majority of Millennials are more financially established to make big moves like purchasing a home, the market was enticing for buyers who had cash on hand to make those moves faster.
However, in the midst of that speed bump, the Millennial group as a whole made it to the top of the purchase list for the 8th consecutive year and it is a great case study that continues to sample how younger generations are investing their money and utilizing the market to their advantage in the long term. One would assume that the Millennial age group saw the carnage that happened in 2008 with the housing market and as they have been through tough times before, they learned from what they went through and positioned themselves for a situation such as the coronavirus pandemic to get into the homebuyers market.