While you might be tempted to assume millennials‘ financial difficulties are what’s keeping them out of the housing market, you’d be missing half the story if you did. Personal preferences are also among the reasons some millennials may not choose to buy a new construction.
How Millennials‘ Housing Preferences Differ
Burdensome student debt and poor job prospects have forced many millennials to delay home buying. When they are ready to buy, however, they’re faced with a lack of starter homes that fit their budgets.
Unlike previous generations, who typically started families in their early- to mid-twenties, millennials are holding off until their late twenties. In addition, more young people are opting to avoid marriage altogether. For many, this is a personal choice, not merely a consequence of financial insecurity. These singles have little incentive to move out of their tiny rented apartments and into family homes of their own.
Location preference is also a factor. Many millennials favor urban areas, preferring easy access to amenities and short commutes over the spacious homes and big backyards of the suburbs. When you consider the regulatory costs and other expenses of urban building, you can see why most builders construct a few large buildings rather than many small starter homes.
Your Options as a Construction Professional
Ultimately, the biggest roadblock keeping millennials out of the housing market may be the lack of affordable homes in the sizes and locations they prefer. Even those who are ready to buy may not find a new construction that meets their needs. Recently, only around 20 percent of newly built homes were entry-level properties, down from 30 percent before 2008.
The demand doesn’t necessarily mean you’ll profit by building these homes, though. In fact, current trends suggest you’re better off not doing so. Older millennials are now starting to make the traditional move to the suburbs, just at a later age than previous generations. In addition, rising rent prices in urban areas are likely to make suburban home ownership increasingly appealing.
For more information on the new construction home market, contact the construction leads experts at Construction Monitor today.