How Millennials Have Changed the Path to Starter Homes

In the past, it was common for people in their 20s to buy smaller, less expensive homes that typically needed updates and as they grew their families, increased income or finished remodels that added value to their homes, they would sell them and move on to a larger home.

The average age for home ownership has increased, showing that millennials are saving more money to put down and buying larger, more expensive and luxurious homes. Studies show that millennials are renting longer and buying homes later in life and this process has pretty much ruled out the idea of “starter homes” for an entire generation.

There are multiple factors that contribute to the change in home ownership. The increasing price of real estate, increase of student loan debt and lower wages for full-time employment have been noted as the main reasons to put off buying a home for people ages 25-34.

While the number of homes owned by millennials may be less than in the past, they are saving more for down payments and buying more expensive homes which is a different path than older first-time home buyers.

If you’re wondering whether buying a home would be a good choice for your future, contact one of our loan officers to see what options they can provide for you. If you’re looking for an idea on what the rate your mortgage would be based on your down payment, try our home mortgage calculator.