When you are noting down your success markers, does owning a home make the list? For most people, it does. Transitioning from having to pay rent to comfortably sit in your home at the end of the month without anyone disturbing your peace is one of the best things ever.
Unfortunately, not many millennials (people aged 25-34) enjoy this privilege. While there is a number of reasons to explain why this is so, the United States’ largest generation has a homeownership rate that’s much lower than that of the two generations that came before them.
Baby boomers, according to Urban Institute’s Laurie Goodman who’s actually one herself, snatched up a home the first chance they got. Most of them sacrificed having to go on vacation for years just to save that extra dollar and afford a down payment on a suitable house. As for millennials, Goodman says, they don’t seem to be that hasty about owning personal residences.
One of the arguments that have been put up to explain this trend is the fact that millennials delay getting married, or don’t even tie the knot at all. According to the Urban Institute, a married individual has an 18% more likelihood of owning a home compared to a single individual.
In 1960, the average marriage age was the early 20s. In this day and age, most people prefer getting married when they are almost 30. And comparing millennials to the silent generation (people currently aged between 70 and 90), individuals in the younger generation are three times less likely to get married than their counterparts when they were in the same age bracket.
Goodman does us a solid and explains how marriage influences your decision to own a home, saying that millennials convince themselves that it represents stability in the rest of your life. Indeed, it does, and if you’re single, you’ll tend to think that you won’t be alone forever.
So why buy a home when you’re alone and you’ll soon find a partner and pool your resources? If you’re single, this thought must have crossed your mind a couple of times or more. Goodman’s view is actually backed by data from the National Realtor Association, given that of the entirety of first-time buyers in the U.S., only a quarter of them are single.
Unmarried couples, on the other hand, are much more interested in owning homes, accounting for 16% of first-time buyers in 2017. Of course, married couples take the lion’s share of the first-time homebuyers’ percentage at 57%, but this is much lower than the 75% of the same group back in 1985.
Do you know what else influences a millennial’s decision to own a home? Kids. By Urban Institute’s calculations, having a kid increases your probability of owning a home by 6%.
However, not many people in their late 20s and early 30s are rushing to have kids nowadays, right? They are more concerned about making money and getting their affairs in order before they can start a family.
In 2015, only 25% of the population aged between 18 and 34 had kids in the U.S. In 1990, the percentage in this age group was at 37%. You get the point.