As it turns out, homebuyers young and old may not be as different as you think.
At least, that’s one of the major takeaways from the National Association of Realtors’ (NAR) 2020 Homebuyer and Seller Generational Trends report. The NAR found that younger millennial buyers (aged 22 to 29) and buyers from the Silent Generation (aged 74 to 94) are surprisingly likeminded when it comes to some of their homebuying preferences.
For example, staying close to loved ones is a high priority for both age groups. In both cohorts, 53% of homebuyers listed proximity to friends and family as a “major factor” that would influence their neighborhood selection when choosing a home.
“The silent generation – older Americans who are typically grandparents and great-grandparents – for years have prioritized living near family and other loved ones,” said Lawrence Yun, chief economist for the NAR. “But it was surprising to see younger millennials with homebuying preferences and ideals similar to older segments of the population.”
No other age group had more than 50% of respondents indicate that convenience to friends and family was a major factor in their neighborhood choice. Thirty-nine percent of older millennials (aged 30-39) responded that it was a major influence, as did 32% of Gen Xers (40-54), 39% of younger boomers (55-64) and 48% of older boomers (65-73).
Among recent homebuyers who bought new homes, another trend emerged mirroring young and old. Of those buyers, the largest share (39%) indicated that they did so to avoid renovations and problems with electricity and plumbing. But among both younger millennials and silent generation buyers, notable shares (25% and 28%, respectively) chose to buy new because of the amenities offered by a new home and its community. While this is in line with historical norms for older generations, it represents a new trend for younger buyers.
Of course, there were also notable differences between younger and older buyers. At 21%, younger millennials exhibit the largest share of unmarried couples buying homes, compared to just 3% of unmarried homebuyers in the Silent Generation buying together. Younger millennials bought homes a median of 12 miles from their previous residences, while older generations like older boomers (40 miles) and the Silent Generation (20 miles) were more likely to travel farther for their next home. Commuting cost remain top of mind to younger millennials, with 45% considering it “very important” in their choice of location; in contrast, just 9% of likely retired silent generation buyers agreed.
And while just 7% of younger millennials purchased a home for a multi-generational household, 18% of silent generation buyers did so — highest among age groups.
Whatever the case, it’s clear from the study that millennials continue to represent a major force as a homebuying demographic. Millennials as a whole made up the largest share (38%) of homebuyers over the past year — the seventh straight year that millennials were the most active generation of buyers.
“For several years now, millennials have shown that homeownership is important to them,” said NAR President Vince Malta. “Their reasons vary: Some are starting families, others are caring for aging parents, while others found that buying a home was decidedly cheaper than renting.”
