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Home Ownership and Millennials

Millennials, as they become young adults, are embracing one of the most stable pillars of the American dream: homeownership. As a result, this soon-to-be largest generation is impacting the housing market. That’s right, Millennials are projected to overtake Baby Boomers as America’s largest generation — and it’s not that far off either. Projections are that this seismic generational shift will occur as soon as 2019.

As a generation, Millennials have been given a lot of bad press – they’ve been called self-involved, lazy, and a myriad of other unflattering things. Case in point, Time magazine recently published a cover story, naming Millennials as the “Me Me Me Generation.”  But the truth is, this generation will soon be the largest economic force driving commerce and other financial concerns as we move into the years ahead. 

According to the National Association of Realtors’ 2018 Home Buyer and Seller Generational Trends Report, 36% of the homes sold in the U.S. over the past year were purchased by Millennials. This means that they constitute the largest segment of new homeowners in the country and a very good reason why current homeowners who are looking to sell in the near future should keep Millennials in mind when you make investments in your home.

Consumer Reports recently identified a few features that appeal to this growing contingent of new homeowners. They are:

  • An updated kitchen
  • Flexible living space
  • Energy efficiency
  • Hassle-free additions (wood floors, updated mechanical systems, etc.)
  • New paint
  • Outdoor recreation areas (such as a patio or a porch)
  • Smart technology

And while you might be forgiven for thinking that all of these features will be assets to your home no matter who ends up buying it, some of them are considered deal-breakers when it comes to Millennials. Here are some other things to consider when it comes to Millennials and homeownership:

Almost 70% of Millennials think of home ownership as an “essential part of the American dream.” 

The 2018 National Housing Forecast by Realtor.com predicts that 43% of the total mortgages will be taken out by Millennials by the end of 2018. 

So no matter which way you look at it, and no matter your opinions of this generation, they are going to be a very influential factor when it comes to the economy (and specifically real estate and homeownership) in the very near future. 

 

IMPORTANT DISCLOSURES

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner AssociatesDavid Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC

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