A recent study by TransUnion found Millennials may be more interested in home buying than previously believed. Roughly 87 million would-be homebuyers are not only hoping to buy, but actively striving to make it happen soon.
While this may come as a surprise, data shows that Millennials’ interest in homeownership has been steadily growing over time. In 2017, 3 in 10 (29%) non-homeowners who shopped for mortgages were Millennials.
So, why should property operations be concerned about first-time homebuyer trends? Generally speaking, rental occupancy and homeownership rates have a strong correlation. Displayed in the statistics given from the U.S. Census Bureau below (Fig. 1), you can see when rental occupancy dips, homeownership rises and vice-versa. Therefore, if homeownership experiences a resurgence, it could impact demand and thus impact revenue for property operations.
While the rental market has clearly experienced strong demand and rising rents in the past several years, there are signs things may be slowing down. When we looked at the data in April 2017, we noted that apartment rent amounts experienced the lowest year-over-year growth since 2011, while owner households formed at double the rate of renter households.
This indication shows that being knowledgeable of certain trends may benefit you in the long run. Visit us at https://rentalscreening.transunion.com to see how you can utilize a service more likely to help keep your renters in their units.