In 2018, agents and brokers will increasingly be working with Millennials, who are now the largest group of home buyers.
This demographic has a completely different wish list than their parents and face different challenges to obtaining the American dream.
According to REALTOR.com’s latest numbers, in November 2017, Millennials (born between 1982 and 2000) made up a 39.6 percent of mortgage originations.
The median price for mortgage originations in November, 2017 was a median price of $238,000 and an average price of $270,000. That number soars when you look to major metro areas Millennials flock to, such as Boston, where the median home value was $561,600 as of November 30, 2017.
According to Javier Vivas, director of Economic Research for realtor.com, the Millennial market share growing.
“Many millennials are buying a home for the first time, so there is inherent enthusiasm in how they approach the process. But for many young homebuyers there is also an increased sense of urgency. Life events and market conditions are accelerating their need to enter the market,” Vivas told Forbes. “Millennials are a driving force in today’s housing market. They already dominate lower price home mortgages and are getting close to overtaking older generations for mid- and upper-tier mortgages. In 2018, we expect millennials (buyers aged 18-34) to gain market share – even in the face of challenges.”
Those challenges include Millennials taking on more debt. According to Vivas, record home price increases in most major cities (where Millennials like to live) is growing faster than income.
“We see them being forced to take on more expensive mortgages with the same down payment,” he said.
Add in student loan debt and some Millennial couples are facing a harsh reality.
Koki Adasi, an associate broker at Long & Foster in the Millennial laden Woodley Park area of Northwest Washington, D.C., works with many Millennials.
“They want an urban lifestyle with good schools and walkability to restaurants, libraries and parks. Millennial wish lists include; open concept living spaces and home offices,” she said.
If your clients are baby boomers selling, chances are high that there is a Millennial buyer just right for their family home.