Millennials are Reshaping the Texas Housing Market
DURATION 4 minute read
Millennials do things differently. And as the largest living adult generation, their choices are reshaping many industries. With many of them expected to purchase a house in the coming years, their unique choices are expected to impact the housing market.
I recently sat down with Jennifer Keller, a Land Development Expert and long-time partner of Jones|Carter to discuss how millennials are expected to reshape the Texas housing market for years to come.
The City or Suburbs?
The migration of millennials to urban downtowns was one of the most discussed trends of the 2010s. The generation prefers walkable, amenity-rich, transit-oriented communities, and, as a result, many downtown developers were quick to create multi-family housing that catered to this connected lifestyle – causing an urban redevelopment boom.
But as millennials grow older, many of them are leaving the urban life-style for suburban living. Per data from the Wall Street Journal, cities with more than half a million people lost roughly 30,000 millennials to greener, more affordable suburban areas. Though it’s still too soon to tell, Jennifer believes COVID-19 will push more millennials to migrate out of the city.
“Stay-at-home orders have given them time to reevaluate their living situation,” Jennifer said. “I think post-covid you will see many millennials looking for more space and other options typically offered in the suburban environment.”
Are More Millennials Expected to Buy Homes?
The largest age bracket among the millennial generation will be turning 30 and reaching milestones previous generations did in their thirties. According to Jennifer, more and more of them are looking to purchase a home – especially those with a family.
“35% of millennials are looking to buy in the next few years,” Jennifer said. “Many home builders are seeing a high demand for first-time buyers and young families looking for more space.”
Low-interest rates are also driving more millennials to purchase homes. In addition to low rates set by the market, Jennifer noted that some home builders are buying down interest rates even lower to incentivize buyers.
Technology is playing a central role in the home buying process for millennials From digital listing sites to virtual tours, technology makes the housing market more accessible than ever for millennials even amidst the nationwide shutdowns due to the coronavirus pandemic. This trend has not gone unnoticed. In fact, Jennifer noted the digital realty platform HAR saw a 60% increase in buyer research during stay-at-home orders.
“Technology in the home buying process is here to stay,” Jennifer said. “I think you will see even more of it as more millennials begin searching for homes.”
If you would like more insight into millennial home preferences and the Texas single-family housing market, check out episode 4 of our podcast, Texas by Design. You can watch the episode on YouTube or listen on all major podcast platforms.