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Millennials, known for avocado toast and brunch, have delayed lifestyle choices like getting married, having children, and buying homes in favor of pursuing education, but as the majority of their generation ages, they are driving demand in the real estate market.
There are currently 45 million people in their 30s and the median age is 33 for first-time home buyers in the United States, according to John Change, senior vice president and director of research at Marcus & Millichap.
"While millennial home ownership has been delayed relative to their generational predecessors, millennials now have the greatest influence on the housing market and remain poised to fuel a roaring 20s of home ownership demand," Odeta Kushi, Deputy Chief Economist at First American said.
In 2020, despite the coronavirus pandemic, millennial potential home ownership demand increased 3.5 percent. This demand is expected to continue as another 2 million people reach their 30s.
“Millennials appear to be pressing on, despite a temporary slowdown caused by the coronavirus pandemic and its impact on home buyers,” Babb said.
A survey by Clever Real Estate reported that 30% of millennials said that they began house-hunting earlier than planned because of the pandemic.
This rising demand and new construction delays, caused by the pandemic and rising costs of lumber, have pushed housing prices to soar. In Utah, single family homes have appreciated 33% since June 2020.
“Home ownership has been largely elusive for millennials over the past decade. But now that they're finally buying homes, the all-at-once demand could end up creating an affordability crisis that makes home ownership unattainable yet again,” said Hillary Hoffower from Business Insider.
In desperation to win bidding wars, many potential homeowners have waived inspections, skipped appraisals, and paid in cash, which are all risky.
To millennials who are looking to buy a home, remember that appraisals and home inspections are here to protect you from making financial decisions that you’ll regret. Stay safe out there.
- Ashley Jorgensen
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