When is the right time to buy a home?
If you’re like most people, you’ve probably grappled with this question at one time or another. But the truth is, there’s no right answer. Some people feel ready to take on a mortgage in their early twenties, shortly after graduating college. Others opt to wait until they’ve tied the knot, and are ready to start a family. And still others forgo home-ownership altogether, choosing to rent for their entire lives.
In other words, when it comes to purchasing your first home, the “right time,” differs from person to person.
Nevertheless, according to a recent study, there are still some interesting patterns when it comes to the timeline of homeownership.
Here’s a breakdown of these patterns by generation.
Baby Boomers
Born between 1944 and 1964, Baby Boomers are the second-oldest population still alive today. Given that, as a whole, this population got married and started having children much earlier than Gen Xers and Millennials, it only makes sense that they purchased homes at much younger ages than later generation. In fact, the greatest portion of Boomers, 30%, purchased a home by the time they were 25 years-old. Further, most Boomers who didn’t purchase a home before age 25, did by the time they turned 30.
Gen Xers
Though a significant portion of this population also purchased a home by the time they were 30, about 16% fewer Gen Xers than Baby Boomers were home-owners by age 30. This is likely due to the fact that there was a noticeable increase in home purchases among Gen Xers in the 31 to 35 year-old age range. It is also worth noting that about 32% of Gen Xers, as compared to only 18% of Baby Boomers, say they still haven’t purchased a home yet.
Millennials
If you spend much time around millennials, it probably won’t come as too much of a surprise to you that only 20% of this generation purchased a home by age 30. In other words, Millennials are about half as likely as Gen Xers to be homeowners by the time their thirtieth birthdays roll around. So where are the majority of millenials living, you ask? Well, given that over 70% of this population is yet to purchase a home, it’s pretty safe to assume that the Millennials you know are still renting.
So why is it that Millennials are so much later to the home-buying game than older generations? There are a couple factors that could explain this trend. The first of which is the fact that millennials are tying the knot much later than Gen Xers and Baby Boomers. And since millennials are getting married later, it only makes sense that they’re putting off homeownership too. Plus, with more and more millennials attending college, burdensome student loans might also be keeping millennials from buying homes in their twenties.
How does the age you purchased your first home compare with the homeownership patterns of your generation? Do you fall in with the majority or are you an outlier?
