New trends in home buying have begun to take shape as America’s real estate market has started regaining ground, specifically in regards to the different generations. According to the National Association of Realtors, the “Millennial Generation”, or Generation Y, has officially become the majority of home buyers in America as of 2015 at 32%, followed by Generation X at 27% and Baby Boomers at 31%. The unique characteristics that make up many of the people in the Millennial generation, born between 1980 and 2000, have made some interesting changes to the housing market.
- Millennials were 68% of all first-time home buyers during 2015, with Gen X and Baby Boomers following at 29% and 14% respectively.
- Millennial homeowners only make up 20% of their generation, versus the 75% of people in the Baby Boomers Generation who own their own homes, according to the California Association of Realtors.
- Millennials grew up during the housing crisis in 2008, watching family members struggle with house payments which makes them leery to take on similar responsibilities.
- Millennials have had to compete with lower employment rates and wages during the economic downturn, limiting their income and amount to be saved for home purchases.
- Millennials have collected hefty student loans with their educations and some choose to reduce that before making a plunge into home ownership. According to the Wall Street Journal, the average student's loans in 2014 rose to $32,000 compared to just $11,000 in 1993.
- Millennials also have the tendency to value experiences over material wealth and traditional life patterns, instead chasing the dream job, focusing on continued education, or investing in international travel. They are focusing more on careers and education now, choosing to postpone marriage, children and home buying until later in life.
Millennials are starting to get older (ages ranging from 16-36 in 2016) and more are ready to make more permanent housing decisions, which will help them surpass older generations in number of home buyers. Some are nudged into buying with the increasing rents as well, since rent may be more expensive than a mortgage in some instances. Once the Millennial Generation has nailed down a steady job and has returned from their travels abroad, they will feel more stable, less transient and ready to settle down. This makes purchasing a home more feasible and cost effective. We should continue to see a significant rise in home purchases by the Millennial Generation in the coming years.
Located in Del Mar, California, North County Property Group provides real estate sales & leasing, property management, and vacation rental services in the various communities throughout the greater North County San Diego area (click here to see communities served).
For more information about North County Property Group, visit https://www.ncpropertygroup.com, or contact the company at 445 Marine View Ave, Suite 240, Del Mar, CA 92014, USA; Tel: 858.792.5797; E-mail: info@ncpropertygroup.com to learn how we’re redefining real estate sales and leasing, property management, and vacation rentals in North County San Diego.
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