Hispanolistic/Getty Images: Illustration by Issiah Davis/Bankrate
Millennials are the largest generation in the U.S. This massive demographic was poised to reshape the housing market, but that hasn’t quite happened in the way we might’ve expected. While millennials value homeownership, high costs have hampered their ability to buy. Here are the latest statistics on this homebuying generation.
Millennials and homebuying statistics
- Millennials were the largest generation of homebuyers in 2023, at 38%. (National Association of Realtors)
- Among first-time homebuyers in 2023, 75% were younger millennials (ages 25 to 33) and 44% were older millennials (ages 34 to 43). (National Association of Realtors)
- Millennials largely consider homeownership part of the American Dream, with 71% citing it as a key component to this goal. (Bankrate)
- Compared to other generations, millennial homeowners have fewer regrets about homebuying: 76% would buy their current home again, compared to 66% of baby boomers and 65% of Gen X. (Bankrate)
- Of aspiring homeowners, just 18% of millennials believe they’ll never be able to save enough to buy a home, compared to 36% of baby boomers. (Bankrate)
How are millennials affecting the housing market?
Millennials value homeownership: 71 percent cite it as a component of the American Dream, according to Bankrate’s 2024 Home Affordability Report.
However, they’re also hindered by affordability challenges. Blame it on the triple whammy of pandemic-elevated home prices, tight inventory and higher mortgage rates.
When it comes to saving for a down payment and closing costs, millennials primarily point to two hurdles: their incomes aren’t high enough (55 percent) and the cost of living is too high (57 percent), according to Bankrate’s Down Payment Survey.
Millennials are also buying their first homes later than baby boomers did. There are a number of reasons behind that delay, including high student debt loads — cited by 14 percent of millennials in Bankrate’s Down Payment Survey — and career and wealth stagnation caused by the Great Recession.
In addition to being held back by financial considerations, many millennials are in a general pattern of reaching life milestones later. In 2020, the median age for a man’s first marriage was above 30 for the first time in history, according to Census estimates, while the median age of a first-time bride was above 28, also for the first time.
Subsequently, millennials are starting their families later, and waiting to buy homes. The typical first-time homebuyer was 35 years old in 2023, according to the National Association of Realtors (NAR) — just shy of the all-time high of 36 years old in 2022.
Even so, for the last eight years, millennials have represented the biggest share of buyers, mounting as high as 43 percent in 2022, according to NAR. (That declined to 38 percent in 2023.)
What are millennials looking for in a home?
Millennials buy larger homes compared to other generations. In 2023, the typical older millennial purchased a home sized 2,400 square feet, while the typical younger millennial purchased a home sized 2,100 square feet, according to NAR. Older generations tended to buy homes less than 2,000 square feet.
Still, with fewer homes on the market, millennials have had little choice but to dial back their expectations and make compromises. Bankrate editor Laurie Richards and her husband bought their first home in 2023.
“My husband and I had originally wanted a bigger home, but we made the hard decision to purchase a starter home in lieu of jumping straight to our forever home,” Richards says. “In the end, this freed up more funds in our budget to go toward any needed repairs or expenses that came with waiving the inspection.”
Tips for millennial homebuyers
- Make a budget and stick to it. Our home affordability calculator can help you narrow down your price range based on income, down payment and more.
- Explore down payment assistance. Depending on your income and location, you might be eligible for a down payment grant, second mortgage or other type of help.
- Shop more than one mortgage lender. It’s not just about interest rates, but the all-in cost for your loan, including lender fees. Compare at least three mortgage offers to see what different lenders charge and find the best deal.
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