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New report says millennials are seriously influencing the housing market

Buying News
Hamilton, MA  4/22/14 For a magazine story on top spots to live, Hamilton is well known as an equestrian paradise, with the median single-family home price of $470,000 in 2013. This is one of the newer developments.
A single-family home in Hamilton, Massachusetts. Michele McDonald for The Boston Globe

It’s true that student debt, the difficulty of living alone in big cities, and steep prices in places like Boston all dissuade young people from taking the plunge into homeownership.

And yet, a new Zillow report—based on a survey in which Zillow asked more than 13,000 U.S. residents aged 18 to 75 about their homes—shows a different picture. Zillow found that half of today’s U.S. home buyers are under 36. In fact, 47 percent of the people currently buying new homes are first-time buyers, according to the report.

“We knew the Millennial generation was playing an increasingly large role in the housing market,” Zillow Chief Economist Dr. Svenja Gudell,  said in a statement. “But this consumer research allows us to get a fascinating, behind-the-scenes look at how their expectations and approach are playing out in the housing market. These young adults came of age during a recession, but they are buying their first homes in a high-priced and fast-paced market.”

This doesn’t mean first-time home buying is easy. Zillow found that less than half of buyers get the first home they bid on — an ever-present problem in Boston’s difficult-to-crack market.

And, often, just saving for a downpayment isn’t enough. Thirty-two percent of buyers have to be resourceful and rely on other sources, such as gifts, loans, and cashing in their retirement savings.

But, as seen in the report, lots of young people are willing to take the risk.

“Young home buyers and sellers share their grandparents’ romantic notions about homeownership, and we’re finally seeing their home buying dreams come true in the data,” Zillow Group chief marketing officer Jeremy Wacksman said in a statement. “These savvy consumers are doing things differently: they juggle shopping for homes to buy and rent at the same time, and they bring deep research and their vast social networks to the process.”