Millennials Drive the Housing Market

Millennials Drive the Housing Market

Tuesday, November 15, 2016

According to an article by Zillow.com, half of home buyers are under age 36. 

“Millennials are shaping the market more than anyone realized. In fact, half of all buyers are under 36 and half of sellers are under 41,” said Zillow Chief Marketing Officer Jeremy Wacksman, referring to results from a survey of more than 13,000 homeowners, sellers, buyers and renters that are part of the new Zillow Group Consumer Housing Trends Report.

Young adults are also driving more diversity among homeowners. Only 66 percent of millennial homeowners are white, compared with 77 percent of all homeowners. Among millennial homeowners, 17 percent are Latino or Hispanic, 10 percent are African-American and 7 percent are Asian or Pacific Islander.

Nearly half of millennial homeowners live in the suburbs

Another surprise from the new report is that a large number of millennial homeowners — 47 percent — live in the suburbs.

We’ve seen millennials move to some suburbs that are tailor-made to suit their tastes and needs — for example, the neighborhood of Stapleton, which was built on the site of Denver’s old airport. But it wasn’t clear until now how many of them are putting down roots outside of cities.

One big reason for the popularity of suburbs is cost. As urban cores have soared in popularity, so have the price tags on urban homes. To afford bigger homes, and to find the shared amenities they like such as community gyms and pools, many millennials are willing to live farther out.

Their willingness to live in the suburbs, along with the fact that millennials waited longer to buy their first homes, may be part of the reason new Zillow research also reveals that today’s “starter” homes are almost as large as “move-up” homes and cost just 18 percent less.

Still, the stereotype of millennials as urban hipsters is not entirely dead: A third of millennial homeowners live in the urban core. No other generation has so many people living downtown.