Millennials have been hailed the killer of all things once considered staples of American life—diamond rings, department stores, marriage, banks and the 9-to-5 workday. But a new report by the USA Today Network says the increased building of starter homes has driven up home sales for that generation, generally those born between 1981 and 1996.
The average size of a newly built house has decreased since 2015, the report states. Builders are putting more small, low-priced homes on the market as millennials’ demands pick up; a reversal of trends seen after the housing crisis when high-priced homes and their larger profit margins dominated the market. Builders have since found a way to build profit-models on smaller starter homes through standardization and limited floor plan options.
In the third quarter of 2019, 37.5% of millennials owned homes, up about one percentage point from the year before and the largest share since 2011. Millennials also made up the biggest portion of all homebuyers in 2018, at 37%, according to the National Association of Realtors.
Single-family homes priced between $200,000 and $299,000 comprise about 34% of all new home sales through the first 11 months of last year, up from 30% in 2017 and 2018, U.S. Census Bureau figures show. The median price of a new home in the third quarter of 2019 was $311,000, according to the National Association of Home Builders.
Yet, USA Today reports house sizes are more telling of the market than prices. From 2015 to 2018, the share of new houses under 2,400 square feet rose to 51% from 47%, according to an NAHB analysis of census data. Read the full story here.
