As the share of first-time homebuyers hovers at its lowest level in nearly three decades, real estate professionals remain optimistic that homeownership is due for a comeback.
In a panel at the 2014 Realtors Conference and Expo, experts discussed the changing face of American homebuyers and the potential effects of these changes on the housing market.
"Among primary residence homebuyers, the demographics have shifted dramatically, especially among first-time homebuyers, whose share of the market has dropped to its lowest level in decades," said Jessica Lautz, panelist and director of member and consumer survey research for the National Association of Realtors (NAR). "We have also seen an increase in the median age and income of the average buyer, as well as in multigenerational household formations as adult children and elderly family members move back in with their families."
One of the biggest topics for the panel was the state of millennial homeownership. While inventory shortages, tight credit access, and lower than average salaries have made for a bleak picture for young adults, the speakers largely agreed that these represent temporary setbacks as the economy makes its way to stable ground.
"It's not that young people don't want to purchase homes, it's that they are delaying the purchase," said Lisa Sturtevant, VP of research for the National Housing Conference. "Many of the reasons millennials are not forming households or making purchases are economic, so as the economy improves, we should see this group become more of a force in the housing market."
Jonathan Smoke, chief economist for Realtor.com, agreed, adding that members of Gen Y accounted for 37 percent of home shoppers over the summer and are expected to make up two-thirds of household formations in the coming years. Smoke also noted that from June through September, more than half of adults between the ages of 21 and 34 visited real estate websites or mobile apps.