Though millennial homeownership confidence may be low, as many believe they are doomed the live in their parents’ basements—or be forever renters—new data from LendingTree shows that in 2023, half of the years mortgage offers on their platform in fact went to millennials.
The millennial generation (now aged 24-42) snapped up 53.85% of all mortgages including some for homes in the most expensive areas of the country, like San Jose, California.
According to LendingTree, these are the key findings from their most recent study:
- Across the nation’s 50 largest metros, 53.85% of mortgage offers in 2023 went to millennials. Millennials received more than 50% of all offered mortgages in 35 of the nation’s 50 largest metros.
- Millennials made up the largest share of potential homebuyers in San Jose, Calif., San Francisco and Boston. In San Jose, 64.75% of mortgages in 2023 were offered to millennials. That’s up slightly from 63.57% in 2022. In San Francisco and Boston, the 2023 figures were 62.77% and 61.46%, respectively. These figures increased from 59.18% and 60.59% in 2022.
- Millennials in Las Vegas, Phoenix and Tampa, Fla., made up the smallest share of potential buyers—though still substantial. In Las Vegas, 40.76% of mortgage offers in 2023 went to millennials. In Phoenix and Tampa, those figures were 44.31% and 45.16%, respectively. These figures were lower than in 2022, when they were 41.92%, 46.11% and 48.71%.
- Millennials in expensive California metros San Jose, San Francisco and Los Angeles planned to put the largest down payments toward their homes. The average down payments among potential millennial homebuyers across these three metros in 2023 were $170,591, $159,392 and $111,068, respectively. For comparison, down payments among potential buyers were smallest in Virginia Beach, Va., San Antonio and Oklahoma City, averaging $36,123, $38,413 and $38,481.
- Like down payments, offered loan amounts were largest in San Jose, San Francisco and Los Angeles. Loan amounts in these three metros in 2023 were $785,391, $731,062 and $627,322, respectively. Conversely, at $242,220, $268,484 and $268,900, average loan amounts offered in Buffalo, N.Y., Cleveland and Louisville, Ky., were the smallest among the nation’s 50 largest metros.
So why are millennials depressed but taking half of all mortgages? It mainly has to do that they are now in their prime homebuying time of their lives; this means they have a greater financial ability to become homeowners and are incentivized by reasons like needing to provide for their loved ones in a way they may not have been when more of them were in their 20s.
Of course, this doesn’t mean members of older generations aren’t buying. They are. This is especially true in today’s high-rate, low-demand lending environment where a relatively large share of buyers pay for their homes entirely in cash. Despite this, millennials remain an active force in the housing market and their influence will likely continue to grow as rates fall and all-cash purchases become less common.
Simply, though millennials are certainly not as wealthy as older generations, they’re at a place where buying often makes the most sense. And as millennials age, younger generations will almost certainly supplant them as the largest share of homebuyers on the market—even if those younger generations might also have to deal with increased financial hardships related to buying.
Click here for the report in its entirety, including graphics and homebuying tips for millennial homebuyers.
