- More than 28% of U.S. homebuyers are most concerned with affordability when it comes to house hunting, according to an August Redfin survey.
- Millennial worries over home prices are more intense, with more than 32% of respondents citing affordability as their top concern. In addition, slightly more than 10% said they were anxious about being able to come up with a down payment.
- Of the first-time buyers who responded to the survey, almost half (45.4%) said that rising rental rates were the primary driver behind their decision to buy a home, a double-digit increase from last year.
For overall buyers, quality, design and floor plan were the highest priorities (44.6%) after affordability and price, but millennials said they valued school quality (43.4%) the most, more so than commuting time (33.6%), green space (35.4%) or home quality and design (43.1%), according to Redfin.
In good news for the housing market, more than 80% of Redfin respondents said factors like Brexit and the ups and downs of the stock market have no effect on their decision to purchase a home, with some buyers saying that their families needed a house regardless of world events.
As the country's largest demographic, millennials draw a significant amount of time and effort from builders and developers looking to predict their buying patterns. Of course, builders can miss the mark occasionally, as was the case with the recent misstep of a Houston developer who found out the hard way that millennials weren't ready to invest in their microcondo building. Millennials tend to be willing to pay the same rent for a little less apartment space, but their enthusiasm for the for-sale micro housing market has yet to be proven. After disappointing presales of the 550 available units in its planned 24-story building, Novel Creative Development changed its strategy to a "condo hotel" concept. The project will now target Investors, who will buy units to rent out for short-term stays.
On an interesting note, Redfin's finding that renters are moving into the housing market because of high rents seems to contradict what housing experts have been saying — that high rents prevent first-time buyers from saving for a down payment, thereby keeping them out of the market. According to a July National Association of Realtors HOME survey, the jump to homeownership for those renters with student loan debt is even more daunting, with 50% delaying buying a house because of that burden.