Why Millennials Will Take Over the 2021 Market
Experts are saying that Millennials could account for at least 15 million home sales over the next 10 years.
Millennials – the bulk of which are turning 30 this year – are the largest and most educated generational group in history. There are about 72 million in the population as of 2019, and most are beginning to enter their prime home-buying years.
A few things are making this even more possible despite rising prices. One is historically low mortgage rates. The main one, however, is a dramatic increase in personal savings, which reached to an all-time high at the April peak of the pandemic lockdowns and remain above the historical average as recreations spending opportunities are limited. For those still employed, these increased savings can be used as a down payment, which is usually the hardest part for first-time home buyers to secure.
Millennials are the key reason economists believe the 2020 market already boomed like it did. In 2020 over 50% of all the purchase mortgages originated by Fannie Mae and Freddie Mac went to first-time home buyers – and there are no signs of this changing in 2021. In 2021, millennials will continue to form households, which will create continued demand for homeownership. More than that, the oldest Millennials are now also starting to upgrade their homes, contributing to the "trade-up" market. This is why 2021 home sales activity is expected to remain strong, and even better than in 2020.
Overall, it looks like we are just at the beginning of a strong housing period, with total home sales between 2020-2024 estimated at 6.2 million or higher – thanks millennial activity.
Written by Joanna Sokolowski
Source: Forbes.com; HousingWire
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