Young Adults Are Speeding Up Their Home Purchases
October 7, 2020
Millennial home shoppers are quickening their homebuying timelines due to the COVID-19 pandemic, according to a new survey by realtor.com® and HarrisX of 2,000 buyers. Born between 1981 and 1997, millennials make up the largest generation in U.S. history, and they are now very eager to buy, many surveys show.
“If there is a silver lining to the current economic landscape, it’s that mortgage rates are hanging around record lows,” says Danielle Hale, chief economist at realtor.com®. “With little to no equity to leverage, millennial home buyers tend to take out larger loans. Historically low rates are making this more manageable, even with rising home prices.”
Shelter-in-place orders helped many millennials who were able to keep their jobs to save for a down payment, Hale said, which is often one of the largest hurdles when buying a home. Sixty-eight percent of survey respondents said shelter-in-place orders helped them save for their down payment. “The combination of low rates and the opportunity to save is enabling many millennials to move up their homebuying timeline,” Hale says.
Of the three-fourths of the 2,000 millennial respondents who have been working remotely since the pandemic, 63% said they plan on purchasing a home because of their ability to work remotely.
Young adults are embracing more virtual options in their house hunt. The pandemic has prompted them to do even more of their home search online, perusing listing photos, videos, researching properties, and evaluating neighborhoods. Thirty-one percent of respondents said they are being more selective about the homes they decide to tour.
About a quarter of millennials surveyed say they’re tired of their current home and want room to increase the size of their family. More than half of the millennials surveyed said they are looking for a home below the U.S. median home price of $350,000, while 37% are looking for a home priced at more than $350,000. About half were looking for a home in their current city. The majority of millennials surveyed expressed a greater desire to move to the suburbs.