Dive Brief:
- The National Association of Realtors has identified the 10 best housing purchase markets for millennials, and its list includes cities as diverse as Austin, TX, Washington, DC, and Minneapolis.
- Markets on the list have a higher-than-average percentage of millennials already living in them, plenty of job options and an overall lower income needed to qualify for a mortgage.
- Millennial rates of homeownership are not as high as they should be, even though mortgage rates are very low, rents are high and employment numbers are strong, NAR Chief Economist Lawrence Yun noted.
Dive Insight:
Yun also pointed to a familiar dilemma — many millennials, especially those in the most expensive markets, are finding it difficult to save for a down payment and pay ever-rising rents. However, the markets on the NAR's list, he said, are also exhibiting robust job growth yet provide a "smoother path to homeownership." Unlike many areas in the country, these metros have enough new and existing hone stock to keep prices affordable — for now, at least.
According to Zillow, prices for entry-level homes are rising faster than other types of homes in more than 50% of the largest metros in the U.S. due to a 10% decline in available starter home inventory since last year. Trulia also reported the same problem — that the number of available entry-level homes listed on the market had fallen 43.6% over the last four years to a share of 27.7%. Trulia also reported that prices for these starter homes had increased 5.6% over the same time period.
The NAR's full list of the Top 10 markets for millennial buyers (in alphabetical order) includes:
- Austin, TX
- Charleston, SC
- Denver
- Minneapolis
- Ogden, UT
- Portland, OR
- Raleigh, NC
- Salt Lake City
- Seattle
- Washington, DC
