As the Millennials who delayed home ownership the aftermath of the Great Recession move into the housing market, many of them are able to bypass the starter-home market in favor of a more expensive “forever home.”
According to the National Association of Realtors, 30% of millennials, defined here as those born between 1980 and 2000, bought homes priced at $300,000 or above this year, up from 14% in 2013. In addition, according to an analysis of Census Bureau data by economist Ralph McLaughlin, almost a third of homes buyers aged 33-37 purchased four-bedroom homes from 2012 to 2016, compared to about 24% in 1980, 1990, and 2000.
By renting or living with their parents for years, many Millennials in their mid-30s can now afford pricier houses because they’ve socked away more money and moved up to better jobs, [says Diane Swonk, chief economist at Grant Thornton.] And they need the extra space because they’re finally getting married and having kids after deferring those transforming events. Also nudging them into more lavish houses is a severe shortage of lower-priced starter homes.
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