The Millennial generation’s impact on the housing market has been a topic of conversation for quite some time. Statistics show this group of young adults now makes up the largest group of buyers in the market, but lower interest rates and an increasing job market are not the only factors driving them to homeownership.
Rental rates are skyrocketing in cities around the country and millennials, most of whom are just starting out in their career, simply cannot afford to pay them anymore. This is especially true in many of the larger metro areas that this young workforce is flocking to for the job of their dreams. In fact, rental rates have increased fifteen percent from 2009 to 2014 nationwide. At the same time, household income has had an estimated growth of only eleven percent (CNN).
The good news for real estate professionals is that rather than stroking a check each month to pay for an expensive rental, more millennials are seriously considering buying their own home. This is because they now view home ownership as an important part of their financial future. In fact, NAR studies show that eighty-four percent of millennials now view buying a home as a good investment.
The bad news is that soaring rental prices are making it hard for most of these hopeful homeowners to save up enough cash for their down payment. But what’s really driving this spike in rental rates? According to the senior director of the Policy Development and Research at Community Partners, “vacancy rates are at very low levels, which continues to push rents even higher.”
What’s important for you to know is that millennials are becoming truly optimistic about their ability to own a home. And as rental rates continue to soar, it’s likely that this optimism will continue to rise and an increasing number of millennials will be moving out of their rentals and contacting you to find a home.
Millennials are the most tech-savvy generation to date, so there’s no doubt that they will be searching for their home online. Homes.com’s Local Connect allows you to target these potential clients when they are searching for their home in the zip-codes where you work. Contact us today to find out how you can start taking advantage of this opportunity today.