In 2020, Millennials made up 37 percent of all U.S. homebuyers, according to the National Association of Realtors’ (NAR) 2021 Home Buyers and Sellers Generational Trends Report. The NAR report says 31 percent of home buyers in 2020 were first-time buyers. Eighty-two percent of buyers 22 to 30 years old and 48 percent of buyers 31 to 40 years old bought a home for the first time.
According to research by Angi, a website that connects homeowners to home service professionals, this demand for new homes was partially fueled by the COVID-19 pandemic. The site surveyed 1,000 adults between the ages of 25 and 39 who bought homes during the pandemic to find out where their priorities lie when it comes to home buying and renovations.
The switch to remote work prompted by COVID-19 impacted Millennials’ decisions to purchase homes. More workplace flexibility means many workers can work from anywhere, leading many young buyers to head out of cities and into more affordable suburban areas, with 50.7 percent moving to a new county or state. Of those, 17 percent said they hope their employers will let them work remotely, while 15.58 percent changed jobs because previous employers wouldn’t allow them to work remotely. Overall, 32.78 percent of respondents chose their preferred location over their job.
The fierce competition within the housing market means many home buyers spent more than they intended, and/or purchased homes that require more updates than they planned. Nearly half (49 percent) of respondents said the market was more competitive than they expected. Seventy-eight percent of respondents put in multiple offers before reaching a deal, 51 percent made more than four offers, and 15 percent made more than 10. Thirty-three percent of Millennial homebuyers paid over asking price, while 35 percent went over their budgets. Additionally, 42 percent of Millennial homebuyers planned to buy homes needing renovations, while 56 percent of buyers actually did. Twenty-eight percent of homes needed major renovations.
These renovations, expected or otherwise, come with a cost. Angi’s research shows 44 percent of respondents will spend $50,000 or more on renovations, and 22 percent have budgets of more than $100,000. Forty-six percent of respondents have already gone over budget on renovations, and 22 percent are more than 20 percent over budget in the first year. A majority of respondents (70 percent) plan to hire professionals, with 78 percent using online platforms to find them. Despite the need for renovations, 88 percent of Millennials expect to or have had difficulty finding home service professionals.