Deeper debt isn’t stopping millennial buyers
Source: National Association of Realtors (Realtor Mag)
Millennials are taking out the greatest share of all new mortgages and buying homes across price ranges.
But a new study also shows they’re going more into debt at an alarming rate.
Realtor.com®’s research team analyzed records for more than 3.2 million mortgages originated from January 2013 to October 2017 and divided it by age groups.
“It’s a mixed bag for millennials,” says Danielle Hale, realtor.com®’s chief economist.
Young adults born between 1982 and 2000 continue to face not only student loan burdens but also higher home prices that are growing faster than wages.
Compared to other generations, millennials are narrowing the gap in the price of homes they’re purchasing.In September, millennials obtained mortgages on homes with a median purchase price of $237,000.
Generation Xers (born between 1965 and 1981) purchased homes with mortgages on a median price of $280,000, and baby boomers (born between 1946 and 1964) purchased at $258,000.Millennials are purchasing a greater share of homes in nearly all price tiers.
They’ve been purchasing the most starter homes—those below $200,000. They’re purchasing the most low- to middle-tier homes in the $200,000 to $350,000 range.
Realtor.com® also predicts that if the current trajectory continues, millennials are set to surpass Gen X by the end of 2018 for the most middle- to upper-tier home purchases (those between $350,000 and $700,000).