Most Millennials Searching for More Income before Home Buying

by Kathy Gregory & Kim Lucas-Mantz

While much has been written about millennials and their lack of house buying, a recent survey suggests the desire is there, but it’s the means that are lacking.

Fannie May recently released the results of their National Housing Survey™ (NHS), and the report suggests that millennial renters of today have “as much desire to own a home as the general population of renters.”

According to the released results, the majority of renters aged 25-34 believe that owning a home is more financially beneficial than renting. Likewise, a majority of millennials also think that owning is better than renting in regards to their lifestyle. Of those surveyed, 91 percent plan to own a home at some point of their lives. That surpasses Generation X (83 percent), baby boomers (68 percent) and pre-baby boomers (25 percent).

However, 52 percent of millennial renters cite income as their main reason for not owning a home yet, compared to 48 percent of all renters surveyed overall. Twenty-nine percent of said renters claim their lifestyle isn’t suitable for ownership at this time.

Likewise, 40 percent of millennials said an increase in income will drive them to buy a home, with 21 percent citing an increase in credit score as an incentive for them to buy.

The vast majority of millennial renters indicate they do plan to buy at some point in the future, but appear to be exercising caution from a financial perspective. This caution may support more sustainable housing costs for consumers and a healthy housing market overall. While the crisis may have stalled wage growth for younger renters, recent improvements in household income seem to be reflected in consumer perceptions, with increasing shares saying that their household income is significantly higher now than a year ago. These improvements are an encouraging sign for millennial renters aspiring to own in the future.

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