Contrary to popular belief, millennials still highly value homeownership. It just might be longer before they buy a home. According to a California Association of REALTORS® (C.A.R.) survey of young adults age 18-34, half expect to buy a home in the next five years.
Majority of millennials surveyed (54 percent) gave homeownership an importance rating of "8" or higher on a scale of 1-10, with 1 being "not at all important" and 10 being "extremely important." The biggest advantages they see in homeownership are the freedom to do what they want with the property, privacy, and the satisfaction of ownership.
"Millennials do see homeownership as an important objective. They may delay it for a few years, but it's a fact of life that most of the young adults today will settle down and have families and will want a home of their own," said David Tonna, president of the Silicon Valley Association of REALTORS® (SILVAR).
More than half of those surveyed (59 percent) said the housing crisis didn't affect their attitude toward homeownership being a good investment. Fifty-nine percent said they expect home prices will rise in a year, and 63 percent believe home prices will be higher in five years.
Majority of millennial renters (76 percent) said they can't afford to buy a home at this time. Although finances are their greatest obstacle to homeownership, student debt does not appear to be their biggest worry. Although one in two millennial renters surveyed have student debt, most don't feel it is preventing them from qualifying for a mortgage. More than one-third (36 percent) said they would be motivated by affordable home prices to buy now. Sixteen percent claimed they would be motivated by having the down payment required to purchase, and 15 percent by an improvement in their finances.
Despite the stereotypes that these young adults mostly seek urban living with a high walkability factor, most millennials said they prefer single-family homes on large lots in the suburbs. Two out of three (67 percent) indicated they plan to purchase a single-family detached home, while only 12 percent said they plan to purchase a townhome or condominium.
C.A.R.'s "2014 California Millennial Survey" was conducted in August 2014 to learn more about millennials' attitudes toward home buying and homeownership. The online survey polled 1,000 California residents age 18-34.
The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.
The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.
Variations of this article have appeared in local area newspapers.
For further information, please email or call the SILVAR office at (408) 200-0100.