Millennials may have delayed their first step into homeownership more than previous generations, but when they do buy, many want to go big and are skipping the traditional starter home.
“In the past, people bought a modest property, lived in it until starting a family, and then traded up to a larger property,” Bradley Nelson, chief marketing officer of Sotheby’s International Realty, told Bloomberg. “Millennials are finally coming out of the gate, and it’s not uncommon for the first purchase as a first-time home buyer to be a multimillion-dollar luxury home in the U.S. or internationally.”
Millennials—adults born between 1981 and 1996—represent the largest share of home buyers in the country, according to the National Association of REALTORS®. They’re becoming a growing force in luxury real estate. As their wealth increases, high-end housing is surging, too.
Their inheritance may also help them supersize their homes in the future. Millennials are set to inherit more wealth than previous generations, according to a Brookings Institute report from May 2020. Also, the pandemic is shaping where they are choosing to call home, seeking larger homes and outdoor prime spots such as Aspen, Colo.; Austin, Texas; and Montecito, Calif., Nelson told Bloomberg. Indeed, Aspen home sales reached a record high in the third quarter of 2020, according to Sotheby’s 2021 Luxury Outlook report.
“It’s the difference of choosing where you want to live versus living where you work,” Nelson says. “Millennials are thinking about their overall lifestyle. It’s propelled these second-tier markets into the top of the interest list.”