Millennials Are Buying Million-Dollar Starter Homes
Stereotypically-painted, millennials have the reputation of being perpetual-renters who are always broke. But some millennials refuse to be pigeonholed in that manner. And they are dispelling these myths in a big way by buying multimillion-dollar luxury homes.
“Starter Homes”
Traditionally, singles or newly-married couples bought modest homes to start their foray into adulthood. They sought these starter homes with room for growth or the possibility to save money for future upward mobility.
Trending with millennials, however, is to become a first-time homebuyer in a lavish multimillion-dollar home. One way they accomplish this goal is to purchase homes in more affordable small cities and rural areas rather than large, expensive metropolises. Another way they attain their aspiration is by becoming millionaires—or even multimillionaires—at a young age.
Many millennials growing up in the digital age have earned millions of dollars as YouTube stars or social media influencers. Others are increasing their wealth through cryptocurrency transactions. They may also be affluent through support by parents who did well in the dotcom bubble before it burst or inherited wealth from baby boomer relatives.
A Generation Defined By The Least Common Denominator
Every young generation is marginalized or maligned by the generations that precede it. The older generations lose patience with perceived or actual faults and then broad-brush all younger generation members.
Millennial homeownership in 2018 was at a historical low. They were renting or living at home longer than the generations that came before them. And they were perceived—often correctly—as overspenders who wasted money on feel-good purchases instead of planning for their futures.
Changes In Attitudes; Changes In Latitudes
This perception is shifting with insights like the National Association of Realtor’s survey in 2020. This survey revealed that a considerable chunk of homebuyers is coming from the millennial generation. Millennials who delay home purchases saved more money toward their first home. They are also shifting to more affordable areas with cheaper taxes and living costs, meanwhile taking advantage of remote employment opportunities. Some are even finding their best real estate choices lie in the international marketplace.
Even during the pandemic, millennials are becoming homeowners at record rates, taking advantage of low-interest rates. As millennials raise their own families, they realize a paradigm shift away from selfish, childish thinking towards more responsible lifestyle choices.
Not Everyone Is Benefiting
Unfortunately, the millennial generation is also suffering a significant wealth gap. While many are thriving and even excelling, other millennials are scarcely making ends meet. And for this group, the pandemic has made things worse.
The pandemic financially destroyed many people with unemployment and health issues. For most millennials who were less wealthy than equally-aged counterparts from previous generations, the hit was even more problematic. These millennials often have massive student debt, coupled with little savings due to expensive rental housing and excess spending.
It is unclear what the future will look like for those who are suffering most at this time. Hopefully, their peers’ success will inspire them to find new and inventive ways to advance themselves.
Meanwhile, realtors worry that the US could run out of new homes to meet millennial homebuying demand.