Do Millennials Hold the Keys to the Future of Homes?
By Derek Schimmel
Do Millennials hold the keys to the future of homes? Mind the pun, but the fact remains: 18 to 34 year-olds make up the largest age demographic in the United States, and their innovations and ever-changing habits are altering the way we look at real estate each and every day. This is most notably seen in delaying what are widely regarding as some of life’s biggest choices — when to marry, have children, and buy a home. The latter on this short list seems to be taking a turn, as baby boomers’ babies are beginning to join the masses in the transition from renting to owning. And now that they’ve started, there is no end in sight.
In fact, the number of millennials buying homes has increased year over year for the last three years. According to the National Association of Realtors, millennials made up 32% of buyers in 2014, 35% in 2015, and 36% in 2016. These numbers represent national averages, and though local stats run parallel, some studies show these percentages are even higher in the Rocky Mountain State.
"How is this possible?” many might ask. The common consensus is that with entry-level housing becoming more unaffordable over the last half-decade, those under the age of 35 continued to rent, and in many cases moved in with their parents. But, keep in mind that over 5 years have passed... millennials are growing up, and despite the delay, they are finally beginning to start families and take the leap into homeownership. Pushing out the timeline has allowed them to build up money for down payments and ultimately afford the increasing starter-home prices. But with Denver's low inventory, this real estate trend may drive starter home prices even higher.
Millennials, through their actions, have built an adapt-or-get-left behind environment. They’ve created a new norm in today’s society, and this is no more apparent than in Denver, a city that has undergone as large a metamorphosis as any over the last 6-8 years. But now their time has come to adapt to the world which they themselves have created. From a real estate perspective, this means biting the rental bullet and buying a home.