I was looking through the 2017 Home Buyers and Sellers Generational trends Report released on March 7th, and found a couple of noteworthy stats to look at.
And yes, the numbers are usually boring, so here's a video that highlights a couple, and might interest you enough to skim some of the other statistics??
The Most Important Colorado Home Lender Trends of 2017 - Part I, Millennials
When it comes to buying and selling real estate in Colorado, it’s not just new home buyers who need to pay close attention to market variables and different new home financing options. Every Colorado home lender, after all, needs to pay just as close attention to the changing demographics and financial behaviors of new home buyers themselves.
How Colorado Home Lender Data can help Local Realtors
Understanding the demographics and financial behavior of borrowers can be hugely beneficial for the average Colorado home lender. However, such data can also benefit local realtors. This is why we’ve gone to lengths to source the most up to date market insights from the National Association of REALTORS® own 2017 Home Buyer and Seller Report.
Who is Buying & Why?
According to the National Association of REALTORS®, the most important demographics which the average Colorado home lender should be watching in 2017, are the so-called millennials and people aged between 37-51. This is because millennials currently represent the largest single majority of new home buyers across the United States, accounting for a whopping 34% of overall new home purchases.
Understanding the Unique Challenges Facing Millenials
While it is fantastic that more millennials are getting onto the housing ladder finally, it's important for realtors and Colorado home lenders to also understand the unique challenges facing this demographic. In fact, 2017 itself has so far seen a 1% drop in the number of millennials entering into home ownership, as well as a corresponding 1% increase in failed home sales when home buying data is compared with that of 2016.
High Debt & Poor Financial Know-How
In order to address the millennial situation, we need to understand why millennials are buying and why they might not be. Thankfully, understanding why not is relatively simple. According to global lender Fiserv, 48% of millennials feel lost when it comes to managing their finances. More specifically, increasing student loan debts, increasing rent prices, and less familiarity with the housing market overall means that many millennials need lenders and realtors to offer more flexible home financing options.
As for why more millennials are buying regardless of the unique financial challenges facing them, this is also relatively simple to understand. The majority of millennials who do buy, after all, are buying property in largely suburban areas due to the fact that 49% of millennial buyers now also have dependent children.
The message to the professional Realtor and Colorado home lender is simple. Millennials might need a little more hand-holding when buying property but the demand for new homes and financing in America is growing. At the same time, there is definitely potential to bring even more millennial buyers into the housing market, through better education in regard to products like local Colorado Home Loan bond programs offering no down payment options (some are "grants", some are seconds). Or other low down programs offered through FHA as well as conventional loan opportunities.
Click to read related blog: 80% of Millennials Want to Buy
Opinions expressed here are the sole responsibility of the author, and do not necessarily reflect the view of Fairway Independent Mortgage.
Ruth Vogt, Sales Manager
#LMB100023827, NMLSR# 257576
Equal Housing Opportunity.
Regulated by the Division of Real Estate.