Millennials continue to dominate the homebuying market, with 37% of all home sales nationwide being made by 25- to 40-year-olds, according to the National Association of Realtors’ 2021 Home Buyer and Seller Generational Trends report.
The report also found growing popularity in multigenerational homes, as a rising number of homebuyers purchased larger residences compared to prior years, including millennials, who comprise the largest share of buyers since NAR's 2014 report. The most recent data shows that 82% of younger millennials and 48% of older millennials were first-time homebuyers, more than other age groups.
During the last year, 18% of homebuyers between the ages of 41 to 65 (Generation X) purchased a multigenerational home–a home that will house adult siblings, adult children, parents, or grandparents.
And while evidence of the pandemic points to an increase in larger and more luxurious homes and properties, the report found cost-saving to play into this decision-making process.
"There are a variety of reasons why large families and extended families are opting to live together, one of which is that it's a great way to save money," said Jessica Lautz, NAR's Vice President of Demographics and Behavioral Insights. "Also, in light of the pandemic, many grandparents and older relatives found that being under a single roof–quarantining with family rather than away–worked out better for them."
Homebuyers ages 75 to 95 were the second most likely to purchase a multigenerational home, and were most likely to purchase senior-related housing, at 27%.
With inventory levels at record-lows, the study found that nearly six in 10 homebuyers between the ages of 22 to 40 said just finding the right property was the most challenging step in the buying process. More than half of all homebuyers (53%) cited finding the right property as the most difficult step.
A recent Clever Real Estate report found that while millennials were eager to purchase more spacious and comfortable homes, they were also timid because they are finding it difficult to afford the traditional 20% down payment. Twenty-eight percent of homebuyers between the ages of 22 to 30–those who make up younger millennial buyers–lived with parents, relatives, or friends before purchasing. This is higher than any other generation. Living with family first tends to allow flexibility toward saving for a down payment and finding a home, given the short supply available.
Twenty percent of homebuyers between the ages of 22 to 30 were unmarried, a decline from 21% from a year ago. Additionally, 22% of homebuyers between the ages of 66 and 74 were single women.
"Single women remain a large buying force," said Lautz. "A number of divorced women and those who were recently widowed purchased a home without the help of a spouse or roommate."
A recent LendingTree analysis of gender and homeownership found that single women are more likely than single men to own a home in each of the nation’s 50 largest metros.
In the midst of the pandemic, virtual tours and digital home shopping tools were in high demand, especially among 22- to 40-year-old buyers.
"Homebuying aside, this segment of the population was already accustomed to doing research online," said Lautz. "So, to see them really embrace virtual tours and virtual open houses was a given, nonetheless, real estate agents are the top information source, and the data shows these buyers ultimately used agents to purchase a home."
An analysis from Zillow confirmed this confidence in tech, as a majority of millennials (59%) said they would be at least somewhat confident making an offer on a home they toured virtually, while 39% would be comfortable buying a home online.
Click here for more information on NAR’s 2021 Home Buyer and Seller Generational Trends report.