Millennial Home Ownership is Finally on the Rise

Brought to you by Belvely Davis

Anyone born between 1981 and 1996 is part of the millennial generation. For many years, millennials weren’t buying homes at the same rates as previous generations. In 2019, only 43% of millennials owned homes, which was well below the national average of 65% when taking every other generation into account.

Even though millennials were old enough to purchase homes in 2019 (23 to 38 years old), there are numerous factors that have caused this generation to avoid buying homes at the same rate as previous generations. However, 2022 marks a notable change in millennial homeownership.

What Kept Millennials From Buying Homes?
There are many reasons why millennials haven’t purchased homes at the same rate as other generations. Some of the primary factors that have contributed to less interest in homeownership among millennials include:

• Entering the job market during the Great Recession
• Higher amounts of debt from student loans
• Stagnant wages
• Delayed marriage
• Rising home prices
• Low inventory

The financial challenges that many young adults have were exacerbated by the fallout from the Great Recession. Keep in mind that 40% of all unemployed individuals in 2009 were between the ages of 15-24 years old. The federal minimum wage has been at $7.25 since 2009 despite some states increasing their minimum wages. Even though the cost of living has increased substantially over the past few decades, median wages only grew by around 0.3% each year from 2007-2017. These factors combined to make it more difficult for millennials to buy homes.

Why Millennial Homeownership is Increasing
When the Federal Reserve dropped interest rates towards the beginning of the COVID-19 pandemic, buying a home became more appealing as a result of the reduced monthly payments. It wasn’t until 2022, however, that millennials started buying homes at a higher rate than anticipated. While only 43% of all millennials owned a home in 2019, this same age group has accounted for around 43% of homebuyers in 2022.

What this data tells us is that millennials are now the primary generation that’s buying homes. The vice president of demographics for the National Association of Realtors, Jessica Lautz, believes that “Some young adults have used the pandemic to their financial advantage by paying down debt and cutting the cost of rent by moving in with family.” By saving up money during the first two years of the pandemic, millennials who were in a poor financial situation before the pandemic may now be at a point where they can afford to buy a home.

Millennials are also aging into more financial security, with steadier jobs and higher incomes in their 30’s and 40’s. Rising home prices haven’t helped, but homeownership rates increase considerably when looking at millennials who are around the age of 40. An increase in remote work post-pandemic has also allowed more millennials and Gen Zers to move to smaller, more affordable cities and improve their homebuying prospects.

In the coming months, it will be interesting to see what happens as interest rates continue to rise. Even though housing prices have increased by nearly 19% since March 2021, this clearly hasn’t caused millennials to become less eager to become homeowners.

Tips for Back-to-School Season

Set a Routine for Your Family
One of the first things you should do to get everyone back in the habit of waking up early and heading off to school is to set a routine that your entire family can follow. Speak with your children about the amount of time they must spend each day doing homework. You should also consider setting some free time where your child can do the things that they enjoy.

In the few weeks before the school year begins, try to re-establish your child’s study routine, which begins by encouraging your child to wake up and go to bed at the exact same time each day. Practicing a set routine before the school year starts should help get everyone on the same page.

Get Organized
Whether you have kids or not, it’s a great time of year to clear out the clutter and get organized. Once the school year begins, things can get hectic quickly. Homework, sports, and extracurriculars can take over the calendar, leaving you little time to do other important tasks. While the summer season is still here, consider taking some time to clean, declutter, and invest in organizational supplies like storage bins, extra shelving, coat hooks, whiteboards, etc. Getting your home and yourself organized now will pay dividends throughout the school year.

Take Advantage of Sales
Many retail stores hold back to school sales that last throughout most of August, which means great deals on everything from school and office supplies to clothes and home goods. This is the perfect opportunity to buy books, school supplies, backpacks, and everything your kid needs for the new year. This is also a great time to update your child’s wardrobe. Bring your child with you when you shop to help them get excited about heading back to school.

Even if you don’t have kids, you can take advantage of these fall sales to refresh your own wardrobe and home spaces and put yourself in the right headspace for the new season.

Keep Your Child’s Mental Activity High
While most children will invariably want to spend most of the warm summer months having fun and spending time with friends, the lengthy duration of the summer can make it difficult for children to readjust to the school learning environment. It’s even possible for children to forget a considerable amount of what they learned during the school year.

If you want to make sure that your children are properly prepared for the school season, try to spend 10-15 minutes playing educational games with your child. These games can easily be played at home or while you’re on vacation.

The back-to-school season is the perfect time of year to make changes to your routine and your home. If you’ve been thinking of moving to a new place, it’s a great time of year to buy or sell a home and give yourself an opportunity to get settled before the start of the new school year.