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Despite stereotypes that millennials all flock to city centers while spending all of their disposable income on avocado toast and rent in luxurious buildings, data from the 2020 Home Buyers and Sellers Generational Trends report shows us that this generational group mirrors home buying tendencies of their grandparents, the silent generation. Younger millennials, buyers aged 22 to 29 years, made up 13% of all homebuyers in 2019, surpassing the silent generation as a buying group, and 3% of sellers. This generation was born between 1990 and 1998, and had a median age of 27 years. Given the younger age of this generational cohort, younger millennials had the highest share of unmarried couples at 21%. Sixty-seven percent of younger millennials had no children living at home and only 7% purchased multi-generational homes.
Younger millennials had the second-lowest median household incomes at $80,000 (only above the silent generation), and 86% were first-time buyers. Fifty-five percent of younger millennials rented an apartment or house before purchasing their home. As is expected with younger homebuyers more than other generations, 33% lived at home before purchasing – 20% with parents or friends without paying rent, and 13% at home while paying rent. In comparison, only 13% of older millennials (those aged 30 to 39) lived at home previously. Younger millennials primarily purchased for the desire to own a home of their own (60%).
The majority (91%) of younger millennials purchased previously-owned homes. Eighty-one percent purchased detached single-family homes, and 9% purchased townhomes or row houses, more than any other generation. Fifty-one percent purchased in the suburbs and one-quarter in small towns, second only to younger boomers. They moved a short median distance of 12 miles from their previous residence. Seventy-four percent said the convenience to a job was an important factor influencing their neighborhood choice, followed by quality of the neighborhood at 66%, and affordability of homes and at 64%. Fifty-three percent rated convenience to family/friends as important, matched only by the silent generation.
Likely due, in part, to lower incomes, student debt, and inventory-led affordability, younger millennials purchased the lowest-priced homes at a median of $206,300. They also purchased the smallest homes at median square feet of 1,600 and the oldest with the median being built in 1978. Ninety-six percent of younger millennials financed their home purchase, with a median down payment of 8%. Commuting costs continue to be more important to this generation than others at 45%. This generation was the most likely to compromise in some way on the home they purchased, most often with the condition and price of the home. Their expected tenure in the home was the shortest at 10 years, equal to older millennials and the silent generation. Millennials overall were the most likely to purchase a home through a real estate agent or broker at 92%, valuing their guidance through the numerous steps of the home buying process.
