In 2014, CNBC asked “Why aren’t millennials buying [homes].” After all, prices were affordable, interest rates were low and overall, owning is cheaper than renting. The article cited an inability to afford a down payment on entry-level salaries, geographical mismatching and even poor credit history as some of the reasons why. Others have suggested that young people just aren’t motivated to own a home, because they witnessed friends and family members losing homes or homes losing value during the 2008 financial crisis, and they did not want to find themselves in the same predicaments.
Media outlets predicted that millennials would make a comeback in the housing market in 2015.
They were right.
But why are millennials buying home in 2015? Bloomberg suggests it is the rising cost of rent. It just makes more financial sense to buy a home than to continue renting in a market when rents keep going up, leaving the renters nothing to show for all the money they paid into their homes and apartments. The number of vacant rental homes is also at a lower point than it has been in over two decades, meaning renters have less choice in where they live, and landlords can charge more money.
The economy may also have something to do with it. More and more jobs are becoming available in cities like Atlanta, as well as Dallas, Chicago, Tampa, Minneapolis, Phoenix and San Francisco. The overall unemployment rate for millennials is also lower than it has been since 2009.
As of April 2015, about 38 percent of millennials owned their own home. While that number is still low, many experts believe it will climb steadily throughout 2015. Trend show young people in the 18 to 34 range looking mostly to urban areas like Buckhead and Midtown. They also want homes that come equipped with the latest technology.
Are you looking to buy your first home? Contact Atlanta Fine Homes Sotheby’s International Realty at 404.237.5000 to get started.