Skip to main content

Report: Millennials No Longer Biggest Group Of Homebuyers

Mar 27, 2023
First-time Millennial homebuyers are still agitated over not having enough funds to make a downpayment on a house, according a survey by Redfin
Head of Multimedia

Older buyers are dominating the market, and changing how homes get purchased.

KEY TAKEAWAYS
  • Housing affordability, student loan debt, childcare costs among reasons fewer millennials are buying homes.
  • Gen X'ers, baby boomers now make up a larger share of homebuyers.
  • Older buyers less likely to require a mortgage.

Millennials no longer rank as the biggest homebuying generation, falling from the top spot for the first time in nearly a decade.

That National Association of Realtors (NAR) says Gen X’ers and baby boomers now make up a bigger share of homebuyers than millennials.

NAR Chief Economist and Vice President of Research Jessica Lautz said millennials can no longer afford to be the largest group of homebuyers, for a variety of reasons.

“Obviously inventory, housing affordability, student loan debt, childcare costs — I think the laundry list goes on and on,” Lautz said.

This shift is also changing how buyers purchase homes, with many older buyers avoiding a mortgage altogether. 
According to NAR’s 2023 Home Buyers and Sellers Generational Trends:

  • Gen X’ers — those between the ages of 43 and 57 — make up the largest share of homebuyers, at 24%. 
  • Younger boomers — those between 58 and 67 — account for 23%.
  • Older boomers — ages 68 to 76 — hold 16% of the market. 
  • That equals older millennials — those 33 to 42 — while younger millennials and Gen Z now make up 12% of homebuyers.

As older buyers make up a larger share of the market, it also means fewer opportunities to write mortgages. While 78% of all buyers financed their purchase, the number drops dramatically with older groups. 

Less than half of all buyers 68 and older required a loan, with many using their home equity to help make a cash purchase. 

“They have quite a bit of equity from their past home and are able to make this trade,” Lautz said. 

Older buyers are also moving farther. Buyers overall moved a median of 50 miles from their current home, up from just 15 miles last year.

Lautz said mortgage originators should look at where homebuyers are coming from and look to expand their marketing.  “They may not know the local area, and being that local expert, really placing yourself as that local expert can be really important, too,” she said. 

Even as buyers get priced out of the market, Lautz said, they’re not giving up on their dream. Across all age groups, 88% of people still think buying a home is a good investment. 

“Even among those who are shut out of home buying and really want to enter the market, they know that this is a good financial investment,” Lautz said. “This is their American dream.”

About the author
Head of Multimedia
Mike Savino was Head of Multimedia at NMP.
Published
Mar 27, 2023
30-Year FRM Ticks Down Slightly

It's averaging 6.79%, Freddie Mac says.

Mar 28, 2024
Pending Home Sales Rose In February

NAR reports 1.6% increase month-over-month.

Mar 28, 2024
Homeownership Expenses Eat Away Affordability

Of more than 500 counties analyzed by ATTOM, 97.8% are less affordable in the first quarter of 2024 than their historic averages.

Mar 27, 2024
MBA: Mortgage Applications Subside

Applications decreased 0.7% from one week earlier.

Mar 27, 2024
Slight Uptick In Mortgage Rates Hold New Home Sales Steady In February

The pace of new home sales in February is up 5.9% from a year earlier.

Mar 26, 2024