More millennials may be entering the housing market as they reach their peak home-buying years, but a report by Zillow shows that buyers are trending older, meaning that baby boomers are active players in a competitive real estate market.
First-time buyers are struggling to beat out their older competitors, who may be able to tap into equity gains from previous homeownership or put down larger cash offers which younger buyers can’t match.
The past year's frenzied housing demand likely has more to do with the demographic makeup of America than a onetime, pandemic-driven boom, a new Zillow® analysis of the age, sex, race and income of home buyers over a decade reveals. Millennials and baby boomers — two of the biggest generations in U.S. history — are in the market for homes in a big way.
Even as millennials are the biggest players in the U.S. housing market, buyers are trending older. The median age of a recent buyer — somebody who bought a home in the past year — was 44 in 2019, up from 40 in 2009. That's largely because baby boomers, who make up a big share of the population, are also more active in the housing market than those their age ten years ago. The share of recent buyers who are 60 years and older grew 47% from 2009 to 2019. Over the same period, the share of recent buyers ages 18–39 fell 13%.ii
This means that millennials, already grappling with skyrocketing housing costs from pre-pandemic housing trends and student debt that make saving for a down payment a steep hill to climb, also generally have more competition from their parents' and grandparents' generations than their predecessors did. That dynamic is likely one reason the share of buyers who were buying their first home has trended down from 46% in 2018 to 37% in 2021.