When a listing attracts multiple offers — common in the hot market of the last couple of years — chances are the homebuyers on the bidding side of that deal are millennials while the recipients of those bids are boomers.
In 2021, millennials, those born between 1980 and 1998, made up the largest share of buyers at 43 percent — up from 37 percent the year before, according to the National Association of Realtors’ annual Home Buyers and Sellers Generational Trends Report.
At the same time, boomers, those born between 1946 and 1964, made up the largest share of sellers at 42 percent — nearly flat from 43 percent in 2020.
In between, Gen Xers made up 22 percent of buyers and 24 percent of sellers. On either end of the generation spectrum, the Silent Generation (born 1925-1945) made up 4 percent of buyers and 6 percent of sellers, while Gen Zers (born 1999-2011) made up 2 percent of both buyers and sellers.
NAR fielded the survey on which the report is based in July 2021 and received 5,795 responses from homebuyers who purchased a primary residence between July 2020 and June 2021. The report’s information about sellers comes from buyer respondents who also sold a home.
The share of first-time buyers rose to 34 percent from 31 percent the year before. Nearly a third of sellers, 32 percent, were first-timers. While 81 percent of younger millennial buyers (born 1990-1998) were first-timers, older millennials (born 1980-1989) were more likely to be first-time sellers (69 percent) than first-time buyers (48 percent).
Overall, buyers had a median income of $102,000 in 2020; Gen Xers had the highest median income at $125,000 and younger millennials had a median of $90,000 while older millennials had a median of $110,300.
Sixty percent of buyers were married couples, 19 percent were single females, 9 percent were single males and another 9 percent were unmarried couples. Thirty-one percent of buyer households had children in the home. Just over a tenth (11 percent) of buyers bought a multi-generational home.
The vast majority of homebuyers, 89 percent, identified as heterosexual or straight. Most also identified as White/Caucasian, 82 percent, while 7 percent said they were Hispanic/Latino, 6 percent were Asian/Pacific Islander, and 6 percent were Black/African American. Among younger millennial buyers, 87 percent identified as White, compared to 80 percent among older millennials.
Among sellers, 89 percent identified as White/Caucasian, 5 percent as Hispanic/Latino, 4 percent as Black/African American and 3 percent as Asian/Pacific Islander.
The vast majority of buyers and sellers, 84 percent each, had at least an associate’s degree while more than a third, 34 percent each, had either a master’s degree or a doctoral degree.
The typical home buyers purchased was 1,900 square feet, had three bedrooms and two bathrooms, was built in 1993, and had a median price of $305,000, according to the report. All buyers in all generations ended up paying a median of 100 percent of the asking price for the home they bought.
The survey did not ask how many buyers used an online listing search site in their home search, but 74 percent of all buyers said they had used a “mobile or tablet search device” as a source in their home search.
The vast majority of all buyers, 87 percent, used a real estate agent in their home purchase; at 92 percent, younger millennials were the most likely to use an agent. Seven percent of overall buyers bought directly from a builder or builder’s agent.
Just over a third of buyers, 35 percent, said they found their agent as a result of an internet home search. Just under three-quarters of buyers, 73 percent, only interviewed one agent during their home search, and in the end, nine out of 10 said they would use their agent again or recommend their agent to others.
Nearly half of all buyers, 47 percent, said they found their agent through a referral from someone they knew and 13 percent said they used an agent they had previously used to buy or sell a home. Seven percent each said they found their agent through either a website or through an inquiry about a specific property viewed online.
Ninety percent of sellers used an agent or broker to sell their home; 7 percent sold as a for-sale-by-owner (FSBO). The median amount of time it took to sell a home was one week.
Among sellers, 41 percent said they found their agent through a referral while 26 percent said they used an agent they had previously used to buy or sell a home. The vast majority, 82 percent, only contacted one agent before choosing who to work with. Only 4 percent of sellers said they did not list their home on a multiple listing service.
When asked when they signed an agent representation disclosure, 59 percent of buyers remembered signing one at some point, but the remainder said either they did not sign one (21 percent) or they didn’t know if they had (21 percent).
Only 40 percent of buyers said they had a written buyer representation arrangement with their agent; 17 percent said it was an oral arrangement, 27 percent said they had no such arrangement, and 16 percent said they didn’t know.
When asked how their agent was compensated, 55 percent of buyers said the seller paid, 11 percent said both the buyer and seller paid, 22 percent said the buyer paid, and 10 percent said they didn’t know.
Among sellers, 15 percent said they did not know commissions and fees could be negotiated. When asked how their agent was compensated, 76 percent of sellers said the seller paid, 12 percent said the buyer and seller paid, 7 percent said the buyer paid and 4 percent did not know.
The vast majority of buyers, 87 percent, financed their home purchase with that figure shooting up to 98 percent among younger millennials. The median amount financed for all buyers was 87 percent of the purchase price. Younger millennials put down a median 8 percent down payment.
Among buyers who made a down payment, 61 percent said it came from savings while 38 percent said it came from selling their primary residence. Twelve percent said it came from a gift from a relative or a friend; younger millennials were the most likely to say they got such a gift: 25 percent.
