For years, millennials looked at owning a home as a distant fantasy. Student debt and a weak job market seemed to conspire to keep this generation stuck in their parents’ basements, if not permanently locked out of the housing market.
But as millennials find better-paying jobs, start families and begin searching for their first homes, they’re encountering an unfortunate reality: Just as they’re finally ready to buy, the housing market has the fewest homes available for sale on record. And those that are for sale are increasingly priced at values inaccessible to first-time buyers.
As a result, the housing market is booming for those with cash to spare — but not for millennials looking to own their first home.
Keona and Cameron Morrison, both 31 and with a combined income of $150,000, have been looking to buy in Los Angeles for two years.
“There’s stuff that comes [on the market]; literally, a couple days later, it’s pending,” Keona said. “It’s crazy.”
Teree Warren, a 31-year-old forensic scientist who grew up in Prince George’s County, isn’t faring much better in the Dallas-Fort Worth area.
“The houses go so quickly,” she said.
Overall millennials are falling behind other generations in homeownership, with first-time home buyers, who usually consist of 40 percent of the market, stuck at 34 percent.
That could become damaging to this generation’s future prosperity. Housing experts say homeownership remains one of the primary ways for the middle class to build wealth, despite the ups and downs of the past decade. And with mortgage rates beginning to creep up, millennials who have to wait to buy could miss out on historically low rates.