Millennials are choosing to buy in Suburbs over Urban Areas
This is the third factoid in a series of four factoids detailing Millennial home buying trends, shopping attitudes and habits and whether they lend themselves to home furnishings purchases in the future. Millennials, ages approximately 17 to 34, represent the largest generational cohort in history with numbers exceeding 83 million.
Millennials are arriving late to the home buying industry and in turn the home furnishings industry. But studies show many Millennials actually would prefer to own rather than rent, but opportunity and financial barriers are hindering them. These first-time home buyers have been sitting out of the housing recovery largely because of financial reasons.
First-time home buyers fell to just 30 percent of units sold in February. Historically it should be at least 40 percent. Even with Millennials waiting longer to buy homes, they still account for the majority of home purchases and this number should grow as more of the generation ages into their 30’s. For three years Millennials have comprised the largest group of recent home buyers, 35 percent in 2015 compared to 32 percent in 2014, more than the previous smaller Generation X (26 percent), Baby Boomers (31 percent), and the oldest Silent Generation (9 percent).
While many Millennials sought the urban lifestyle for renting, most appear to be leaving the city for the suburbs when it comes to buying a home. In 2015, only 17 percent of Millennial home buyers purchased inside an urban or central city area compared to 21 percent a year ago. The higher costs of in-town properties in many urban areas are driving them to the suburbs where they are looking for more affordable and larger homes.
Source: National Association of Realtors (NAR)