Dive Brief:
- A new whitepaper from national homebuilder PulteGroup explores the homebuying behavior of the millennial generation. The company surveyed 3,000 "affluent" millennials in metros in which the company is actively building. The group has an average annual income of $105,000, and six in 10 have graduated from college.
- The report considered the older segment of millennials, who are in their late 20s and early 30s.
- Nine in 10 surveyed said they wanted to own a home, with more than half already doing so. A majority said they would live in a suburban area.
Dive Insight:
In addition to student loans, another major financial barrier to millennial homeownership is a lack of available inventory at prices they can afford. Nearly one-third of millennials listed affordability as a primary concern in an August survey of U.S. homebuyers by real estate listing website Redfin. Many, however, weren’t aware of mortgage plans requiring a lower down payment than is typical to address their concern of student loan debt and rising rents making it difficult to save money to buy a home.
A report this month from LendingTree echoed those sentiments, with 63.3% of millennial respondents saying they either had or would soon have student load debt, and that the debt was preventing nearly half (45.3%) of them from purchasing a home.
Buyers under the age of 35 accounted for 35.2% of homeowners during the third quarter, consistent with the past year, based on the latest date on homeownership from the U.S. Census Bureau. Most of those young homeowners are looking to the suburbs, Zillow noted in a report this month, echoing PulteGroup’s latest findings. Additionally, the generation is more diverse than those previously, with the Latino/Hispanic segment expected to grow significantly to make up more than half of household formations in the U.S. by 2030, and they rely more heavily on social media and the internet to inform their purchasing decisions.
