10M // Real Estate & Home Builders Guide // May 2017
Who are millennial home buyers?
By Ilyce Glink
and Samuel J. Tamkin
Tribune Content Agency
E
arly reports by the Pew
Research Center, cited
millennials (81 million
of them) as those individuals
born in 1981 and later, up until
today. Other researchers capped
the era at those born between
1981 or 1982 and 1994 or 1995,
which would put the youngest
millennials at around age 22 or 23
up until about age 35 or 36.
Generation Z (the generation
younger than the millennials) is
the next-gen group that some are
already calling ‘digital natives.’
(Ilyce sometimes refers to them as
the generation born with a “chip”
built into their brain.)
In short, the oldest millennials
will remember life before Google
and what a telephone’s busy signal
sounded like. Gen Z (including
our own kids) won’t.
Around the world, millennials
are considered one of the most
consistent generations. Whether
you’re a millennial living in
Tokyo, Munich or Springfield,
Ill., surveys have found that your
generation is very similar in the
way you behave, the way you use
and consume technology, the way
you dress and the way you learn.
Much of this has to do with
the internet, as this cohort is the
most tech-savvy, and technology
has flattened much of the world.
Information flows freely, is
adapted to life seamlessly, and has
profoundly (and quickly) changed
life for this generation and their
parents. It has certainly changed
how people buy, sell, finance and
invest in real estate.
According to the 2016 Survey
of Home Buyers and Sellers, an
annual report published by the
National Association of Realtors,
first-time buyers now fall directly
into the millennial sweet spot:
They’re a median 32 years old (if
THINKSTOCK
IMAGE
you look at all home buyers, the
median age is 44 years old). Their
median income is $72,000.
The median price of a first-
time buyer’s home purchase is
$182,500, although that ranges
from just about $161,000 for
unmarried couples to $208,500
for married couples. The median
down payment is 6 percent, and 60
percent of millennial buyers are
childless. Ninety-five percent were
either renters or lived with their
parents before buying their first
home. One percent purchased the
home they had previously rented,
and 87 percent were born in the
U.S.
For a while, we’ve watched
the real estate industry change
to accommodate this new buyer,
adopting and discarding new
technologies, trying to find a way
to communicate faster and more
effectively with a generation that
seems to prefer texting to talking.
This is a generation that feels
entirely comfortable soliciting
feedback from friends versus
trusting the real estate agent they
hired to help them make the single
biggest purchase of their lives.
Ironically, just as millennials
are ready to buy, interest rates are
beginning to rise and home prices
are skyrocketing, thanks in no
small part to the baby boomers
staying in their homes instead of
downsizing.
All of which means that this
generation, like those before, is
finding it’s expensive to buy the
home of your dreams.
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