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millennials and boomers

How Millennial and Boomer Views of the Housing Market Differ


Jan 22, 2020 by Aly J. Yale
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It seems that baby boomers are a lot more optimistic about the housing market than their millennial counterparts.

According to the 2019 Q4 Homeownership Opportunities and Market Survey from the National Association of Realtors, just 53% of millennials think it's a good time to buy a home. But boomers? A whopping 70% of younger ones (those born between 1955 and 1964) say it is. Older boomers (born between 1946 and 1954) come in only slightly lower at 66%.

As the report explains, "Not surprisingly, with rapid home price acceleration, those who are currently renting or living with someone else, live in the West, or are millennials are more likely to believe that now is not a good time to buy a home."

That's not the only market indicator the cohorts diverge on, though. Fewer millennials think selling conditions are prime, too, with nearly a third saying it's actually a bad time to sell a house. Meanwhile, just 20% of younger boomers and 25% of older boomers say so.

Another interesting takeaway from NAR's findings? Older boomers are more worried about qualifying for a mortgage than millennials. A full 35% of older boomers say getting a mortgage would be very difficult, while only 29% of millennials say so. (Only a quarter of younger boomers fear a "very difficult" mortgage process.)

What they agree on

The differences of opinion, however, aren't sweeping. So what do millennials and boomers agree on? That would be recent home price growth.

Nearly two-thirds of millennials, younger boomers, and older boomers all say home prices have risen in the last 12 months in their area. About half of millennials say that growth will continue, while only about 38% of younger boomers and 40% of older boomers say so. Those located in the Western U.S. were most likely to report home price growth, at 72%.

Here's what Lawrence Yun, NAR's chief economist, has to say about it: "The Western region has seen home prices increase to the point that costs have outpaced income. So, it is no wonder that those living in the West would think that now is a perfect time to place a home on the market. California especially is seeing some of the highest prices ever."

The two generations also have similar takes on the economy. For both millennials and older boomers, 47% say the economy is improving while 53% say it's not. According to the data, the more money a respondent made, the more likely they were to be optimistic about economic conditions. Rural respondents also showed more optimism than urban and suburban residents.

Here's a quick look at where these generations fall on major housing market questions:

MILLENNIALS YOUNGER BOOMERS OLDER BOOMERS
Is it a good time to buy a home? 53% 70% 66%
Is it a good time to sell a home?  68% 80% 75%
Have home prices gone up in your area in the last 12 months? 68% 65% 66%
Will home prices rise in the next 6 months? 47% 38% 40%
Do you expect it to be very difficult to qualify for a mortgage? 29% 26% 35%
Is the economy improving? 47% 56% 47%

The bottom line

Millennials and boomers clearly have some different takes on the housing market -- as well as what's in store for 2020. Only time will tell which cohort's expectations win out.

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