Housing Market May Leave Millennials Behind

It has become abundantly clear that the housing market is turning a corner. With prospective homebuyers unfreezing their assets after four years of market uncertainty, the monthly rate of home closings has jumped substantially. Broadly tallied, the value of homes across the United States has risen with the monthly sum of home sales. Even seemingly peripheral economic factors such as a rise in the quarterly profits from home appliance sales validate the health of the housing market.

Consumer confidence and homebuyer confidence often run hand in hand, and it’s an enormous relief for property investors to see that the market is returning to good form. Demographically speaking, we’re seeing a broad array of hopeful homeowners making the transition into buying property. However, it appears one key demographic may still be stalled on their path to purchasing homes.

According to new reporting from Business Insider, Millennials may experience significant difficulty in transitioning to homeowners. Encompassing the demographic of young Americans between the ages of 22 and 30, this generation has made a name for itself as perpetual renters. As they continue to age, and as the economy makes a slow transition to stability, many of these young adults have expressed mounting interest in purchasing homes of their own.

Taking this into consideration, there are some possible obstacles unique to their generation. As Business Insider notes, the housing inventory has decreased in the previous months. This decrease in market-ready property coupled with a newfound demand for sales-ready real estate has worked to actively increase the median value of homes sold within the United States. However, there is a growing contingent of current homeowners looking to sell their property now that real estate prices are rising.

That being said, it appears that the homebuyer challenges particular to Millennials may persist beyond the recovery of the housing sector. The combination of a withered job market and overall market depression has left young adults with little capital and few assets. Many have been grateful with the comfort offered by a steady job and an apartment. However, they widely lack the windfall capital necessary to put down a loan or purchase a home.

Additionally, many young adults may be caught in the difficult position of entering the buyer’s market during a period of exceptionally low home prices and mortgage rate. While the long-term homebuyer prospects of today’s 20-somethings are far from determined, there are some definitive challenges to them becoming a demographic of homeowners.

is a writer for NVR Inc., a prime developer of new condos in Maryland. Addressing a range of real estate topics including investment, mortgages, and new construction, Stowe combines finance knowledge with additional experience working with Ryan Homes in the current real estate market.