Today’s national housing market is hyper-competitive, and current market conditions are creating a generational housing war of sorts - pitting baby boomers against millennials. And it seems like boomers are winning. A recent Zillow study has shown that boomers are more active in the real estate market than in decades past. In fact, the percentage of active real estate buyers from 2009 to 2019 who were 60 years and up grew by 47%! During the same time period, millennial buyers (aged 18-39) dropped by 13%. Since 2019 this gap has continued to grow in many areas of the country.
We are in a time where millennials make up the largest population in the country, and we have entered their prime homebuying years. It should follow that they would make up the largest share of the homebuyers market, but this is not the case. So, what is leading to this disparity? Millennials are at a disadvantage due to the rising home prices facing Americans. Between 2009-2019 home prices rose an astounding 31.2%. Then when the pandemic hit, the market changed again. Homebuyers are now looking for more space, driven by remote work and changing priorities. This, combined with a huge lack of inventory, has driven home prices to record highs throughout the country. With inventory scarce, the new norm when buying real estate for sale in the Florida Keys, and throughout the country, is bidding wars, more money down, and all cash purchases. When sellers hold the cards, the more attractive offer wins. All of these tend to favor boomers, who can afford to offer these more attractive terms. Most having been previous homeowners, they have equity from their previous homes that allow them to purchase all-cash, or years and years of savings to put more money down. Millennials simply do not have this, and it is leading to them losing out on transactions in many cases.
According to Business Insider, the market is just not favorable right now for millennials. Millennials struggled to recover from the recession of 2008 and have been met with hurdles such as skyrocketing cost of living, massive college loan debt, and other challenges. Exacerbating this is the fact that there is simply not enough being built - especially starter homes - in recent years. Business Insider reports that in the past ten years, there have been 20 times fewer homes built than any decade since the 1960s. And most of what is being built today are more on the luxury side than starter homes. It has become increasingly difficult for millennials to purchase real estate. As the pandemic continues, many are watching with a close eye to see how the millennials fare in the coming years.
Whether you are a boomer looking for a luxury home for sale in the Florida Keys, or a millennial interested in waterfront real estate in the Fl Keys, we can help you find the best property for you and your family!