Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Former Fannie Mae Headquarters. Photo by Wikipedia.

WASHINGTON, DC–Millennials have been less likely to buy a home than previous generations for several reasons including the far-ranging impact of the Great Recession and their own inclinations to renting in urban areas. Or so the theory went. Now, new research from Fannie Mae and the University of Southern California suggest that this cohort may have been participating in the housing market more than realized. Perhaps more importantly, it shows that this group is poised to have a major impact on housing demand going forward. “[W] the economy in recovery mode for nearly a decade…Millennials [are] beginning to increase their attainment of home ownership,” report authors Patrick Simmons of Fannie Mae and University of Southern California’s Dowell Myers wrote.

Read Renter Households Reach 50-Year High

The study analyzed recent data from the Census Bureau’s American Community Survey. What is significant is that two different change-measurement approaches were used in the study — and they yielded dramatically different views on the state of millennial home ownership.

Millennials Can Move the Needle On The Housing Market

The findings are significant for the US housing industry overall as millennials could help end a frustratingly slow housing recovery. “With more than 88 million members, the millennial generation has the sheer bulk needed to propel the housing recovery to a higher level and it now fills the 25-34 year-old age range that traditionally accounts for the most first-time home buyers,” Simmons and Myers wrote.

The Traditional Age-Group Approach

One approach, called the Traditional Age-Group Approach suggests that millennial home ownership demand will continue to slumber. According to the report:

This “age-group” approach compares the cumulative home ownership attainment for different groups of individuals at the same age but at different points in time. Cumulative home ownership attainment at a given age reflects not only a group’s current rate of ascent into home ownership under prevailing economic conditions, but also the legacy of its past pace of advance under sometimes very different economic circumstances. This is certainly the case for Millennials in their 30s, whose current home ownership rate reflects not only recent home-buying activity in a healthy economy, but also earlier housing decisions made amidst one of the worst economic downturns in US history.

The report noted that applying age-group analysis to the Census data reveals no rebound in young-adult home ownership rates despite years of economic recovery.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Erika Morphy

Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.

More from this author


Join 1000+ of the industry's top owners, investors, developers, brokers & financiers at THE MULTIFAMILY EVENT OF THE YEAR!

Get More Information


Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.