Millennials may delay having children to afford a home purchase
As housing affordability continues eroding on growing property values and mortgage rates, nearly a quarter of millennials believe they need to delay having children to afford a home purchase, according to ValueInsured.
"Conventional wisdom assumed millennials were buying homes later because they chose to get married and have children later," Joe Melendez, CEO and founder of ValueInsured, said in a press release. "New research now suggests homeownership may be the cause, not the effect, of delayed family formation. It is an alarming trend, and we see more acute evidence in expensive housing regions."
Millennials comprise the largest cohort of homebuyers, and will be responsible for driving the housing demand curve forward through the end of the year, but their perceptions on making a purchase soured in the third quarter.
The share of millennials reporting that buying a home today is a good investment fell into negative territory at 48%, according to ValueInsured's Modern Homebuyer Survey. This marks a survey low which is down from 54% a quarter ago and down from the previous high of 77% hit two years ago.
Further demonstrating a shift in their views, 61% of millennials claim buying a home is more beneficial than renting, which is another survey low and a significant drop from just two years ago when the share was 83%.
About 58% of millennials claim that a home purchase is the best decision they can make for themselves and their families, which is the lowest this figure has been in the past 10 quarters.
The generation continues associating owning a home with making sacrifices, as 32% don't think they can afford a healthy and balanced diet while saving to buy a home at current prices.