Mortgage

Where millennials are putting their money

Education vs. Homeownership

It’s not new information that millennials are putting homeownership on the backburner, but CoreLogic noted statistics that show what it is being replaced with.

“A rise in educational attainment coupled with effects of the Great Recession are delaying millennial major life events, such as marriage and homeownership,” CoreLogic said.

The homeownership rate for 25- to 34-year-old Baby Boomers was 51.6% in 1980.

This is significantly higher than same cohort in 2012, which was nearly 14 percentage points lower at 37.9%.

“Marriage often drives the desire to become a homeowner, but it is happening later and later with each successive generation,” the report said.

The same results seen in homeownership can be seen with marriage, as the share of millennials that are married was 26% in 2013, down from 36% for Generation X and 48% for Baby Boomers when they were the same age.

Instead, the proportion of millennials with a bachelor’s degree was 34% in 2013, up from 24% for Baby Boomers when they were the same age.

“The rise of educational achievement has been occurring steadily and started well before the Great Recession began in 2007. Educational attainment is theoretically an investment in future income earning capability, so the fact that Millennials are more educated than prior generations should prove beneficial for their ability to become homeowners in the long term,” the report said.

However, it might be awhile before the economy gets to reap the benefits of this since in the short term, they will carry higher debt loads and face stiffer economic winds. 

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3d rendering of a row of luxury townhouses along a street

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