Maybe Millennials' Housing Tastes Aren’t So Different
September 17, 2014
The majority of millennials’ housing preferences may not be as different from previous generations as once believed, according to a new report released this week from The Demand Institute, Millennials and Their Homes: Still Seeking the American Dream.The report finds that the majority of millennials want to own a house in the suburbs as they look to raise families and they want more space, a veer from other studies that have shown twentysomethings will likely choose walkable urban neighborhoods when it comes time to buy.
Millennials are expected to form 8.3 million households over the next five years. They are projected to spend $1.6 trillion on home purchases by 2018, the report shows.
Tough to Pin Down
“A fundamental question about millennials is whether their coming of age in the Great Recession has shaped their goals and aspirations to be different from those of previous generations,” said Louise Keely, president of the Demand Institute and senior vice president at Nielsen. “We found that, while this generation has many unique characteristics when it comes to their housing choices, they share many of the same intentions as young adults in previous decades.”
Like previous generations, they still have a big thirst for home ownership. Twenty-four percent of 1,000 households aged 18 to 29 surveyed say they already own their home while 60 percent say they plan to buy a home in the future. Seventy-five percent described home ownership as an “important long-term goal.”
What they want in their home isn’t that different, either. Sixty-two percent said their next home would be a single-family house, while 38 percent said they plan to have their next home be in the city.
A majority of respondents also said they’re OK with having to take a “short drive” to amenities, like restaurants, grocery stores, or shopping, instead of being within walking distance.
But the millennials’ path to home ownership may be more of a struggle than previous generations. Twentysomethings have little savings – about $3,000, on average. Forty-four percent of millennials surveyed said they weren’t confident they’d qualify for a mortgage. Sixty-nine percent said they’d be willing to consider other means to get there, however, such as a lease-to-own agreement.
Source: “Millenials’ ‘American Dream’ Not So Different From Anyone Else’s,” The Los Angeles Times (Sept. 16, 2014); “Millennials and Their Homes: Still Seeking the American Dream,” Demand Institute (September 2014); and “Millennials and the American Dream,” National Association of REALTORS® Economists’ Outlook Blog (Sept. 16, 2014)
Updated: June 22, 2018