Hardware Retailing The Industry's Source for Insights and Information
In the past few years, we’ve seen millennials who, after graduating from college, have chosen to live downtown or in an urban area (usually renting an apartment in the neighborhood of their choice). There’s plenty of nightlife and other activities outside of work, and it’s often a short commute, if they work downtown. In some cities, a car may not even be necessary.
More recently, however, those millennials have been leaving the urban areas. They’re getting married, starting families and moving to the suburbs.
According to an annual survey by the National Association of Realtors (NAR), just 17 percent of millennials bought homes in urban or central cities areas, down from 21 percent in 2015.
“The median age of a millennial homebuyer is 30 years old, which typically is the time in life where one settles down to marry and raise a family,” says Lawrence Yun, chief economist for NAR. “Even if an urban setting is where they’d like to buy their first home, the need for more space at an affordable price is for the most part pushing their search further out.”
Housing inventory has tightened, and home prices have risen. Finding an affordable home in a city center has become more difficult. However, interest rates are still low, an encouraging factor for those millennials who want to buy.
Other factors, such as debt—especially student loan debt—have kept some millenials from purchasing a home, as paying off debt meant it took longer for them to save up for a down payment.
They aren’t the only ones with that debt, either. Yun says both Gen X and young boomer buyers have more debt than millennial buyers.
But more and more millennials do want to own a home. According to the NAR survey, 48 percent of those surveyed say the desire to own was their primary reason for buying (up from 39 percent the previous year).
