Last week, the National Association of Realtors® released its annual survey of Home Buyer and Seller Generational Trends study, which evaluates the generational differences of recent home buyers and sellers. For the second consecutive year, NAR’s study found that the largest group of recent buyers was the millennial generation, those 34 and younger, who composed 32 percent of all buyers (31 percent in 2013).
Home buying by the millennial generation is critical to the comeback of the housing industry since these folks are the first-time buyers who allow existing homebuyers to sell their homes and move-up or downsize to the homes they want to buy.
Commenting on the results of the survey, Lawrence Yun, chief economist for NAR said this: “Many millennials have endured underemployment and subpar wage growth, and rising rents and repaying student debt have made it very difficult to save for a downpayment. For some, even forming households of their own has been a challenge.”
“Even though the share of first-time buyers has fallen to its lowest level since 19871, young adults in general are more mobile than older households,” adds Yun. “The return of first-time buyers to normal levels will eventually take place in upcoming years as those living with their parents are likely to form households of their own first as renters and then eventually as homeowners.” (Yun)
An interesting phenomena noted in the report is the existence of “multi-generational” buyers, consisting of adult siblings, adult children, parents and/or grandparents. The survey estimates that 13% of all home purchases last year were by such groups of buyers. The biggest reasons for a multi-generational purchase were cost savings (24 percent) and adult children moving back into the house (23 percent). Younger boomers represented the largest share of multi-generational buyers at 21 percent, with 37 percent of those saying the primary reason for their purchase was due to adult children moving back into their house.
We of the Elite Team at RE/MAX Peak Properties have made some of these multi-generational sales in Flagstaff, where the cost of housing is much higher than in much of the country. To buy or sell a Flagstaff home, give us a call: 928-714-0001.