No wonder so many homebuyers are millennials – people between the ages of 26 and 41.
This demographic is where people typically start families and enter their prime earning years – when buying makes sense.
So concludes new report mortgage marketplace LendingTree, which studied mortgage offers made last year in the country’s 50 largest metropolitan areas. More than half of those mortgage offers — almost 53% — went to millennials, who also make up the majority of buyers in 37 of these metropolitan areas.
In San Jose, Denver, and Boston, millennials make up the largest proportion of buyers, with over 60% of mortgage offerings.
Meanwhile, in the sunny climes of Las Vegas, Birmingham and Phoenix, they make up the smallest share – about 45% of mortgage offers.
The average age of these mortgage applicants is around 32 or 33 years old.
“Even if millennials aren’t typically as financially secure as the older generation, that doesn’t stop many of them from jumping into the housing market,” writes Jacob Channell, senior economist at LendingTree and author of the report.
He expects that as these young buyers “continue to age, marry and start families, the share of millennial homeowners is likely to rise even more.”
In terms of down payments, the expensive California cities of San Jose, San Francisco, and Los Angeles required the largest down payments, averaging almost $130,000 per house.
That’s more than three times the down payment in the cheapest areas of St. Louis, Virginia Beach and Oklahoma City. There, the average down payment was only $39,000.
New York was the seventh most popular urban area for millennials looking for a mortgage, with an average millennial down payment of around $91,000.
LendingTree compared mortgage offerings for millennial borrowers with those for the general population aged 18 to 80.
The report concludes that “while certainly not as financially well off as the older generation, millennials are in a state where buying often makes the most sense. And as millennials age, younger generations are likely to displace them as the largest share of homebuyers on the market — even if those younger generations may also have to face increasing financial hardship to buy.”
Credit: nypost.com /