How 2019’s millennials are beating stereotypes and buying in the least likely places
Most of 2018 was a hot year for the housing market, but as we approached the later months, the housing market began to cool off. Why is that? Well, as we addressed in our previous housing market blog update back in January, much of 2017 and 2018 was red hot for homeowners looking to sell their homes. This was due to high demand from buyers and little competition. But like all imbalanced markets, market forces began to shift in the later months of 2018, slowing the two year explosive growth sellers had been experiencing. Consequently, the housing market began to show signs of balance again as many buyers opted to wait patiently for an inevitable shift in tides. While 2019 continues to favor sellers, many existing buyers looking to upgrade to a larger home are seeing favorable prices decreases. That being said, what is the fate for first time home buyers? This segment has been priced out over the past two years, and has witnessed starter home price hikes averaging 57%. Is there hope for them in 2019?
Millennial first time home buyers are moving to unexpected places
2017 and 2018 were hard years for first time home buyers, with a marginal number of new, affordable homes being constructed and prices soaring, many millennials opted for renting in large cities and or staying one more year in mom and dad’s basement. The Millennial generation tends to get a bad rep for being overly dependent on parents and delaying responsibility, but the reality is, waiting one more year in 2017 and 2018 may have been the best tactical decision for a generation whose educational debt is high and salary is comparatively low.
That being said, millennials have officially entered the housing market and they are projected to dominate the market in the coming years. Interestingly enough, the common stereotype that “millennials primarily purchase homes in large metro areas” is becoming less and less credible as millennials are now shifting toward less traditional secondary markets that are seeing a recent boom in job availability. Why is this? Simply put, price. Thanks to Millennials savviness, small cities like Buffalo, Madison, Cincinnati, Salt Lake City, and Grand Rapids are experiencing huge growth while cities like New York and Chicago are slowly bleeding the younger generation.
First time buyers and Indianapolis
Many cities are listed as having low priced housing, but that consequently goes hand-in-hand with poor job growth outlook. On the other hand, cities with relatively strong job growth outlook are extremely expensive. Oddly enough, Indianapolis is the only city to score in the top 10 by Trulia, a real-estate search site, for both lowest price per square foot and best job market. That being said, it only takes a walk through a downtown neighborhood like Fountain Square and a drive through suburbs like Carmel to see that Millennials to see that Millennials are purchasing affordable homes here. They are purchasing affordable homes here. It’s likely if you were to ask where they moved from, many would respond Chicago, Los Angeles, New York, and other large metropolitan cities. Even better, many would answer they left for a large city and returned. This influx of the millennial population will only benefit the economy of Indianapolis. It has brought life to the city, and it is only expected to keep growing.