Experts differ on whether millennials plan to buy a home
PHOENIX — Two surveys are giving different predictions over whether Arizona millennials plan to buy a home here anytime soon.
A new BMO Harris Bank study says that 8 in 10 Arizonans between the ages of 18 and 34 plan to buy a house in the next five years.
“They must have confidence that either ‘I’m going to have a stable job’ or that they’re going to be able to save funds over a longer term,” said Tony Cesarana, a mortgage banker for BMO Harris.
But ASU School of Real Estate Director Michael Orr disagrees.
ASU released a study last week that said Valley home prices would not rise much for the rest of the year. It claimed that there was lower demand for houses, partly because millennials are not interested in buying them.
“The majority of millennials are putting homebuying off until later,” said Orr. “They’re putting a number of things off in life: They’re getting married later, they’re having children later. Buying a home is another thing that they’re doing later. The majority of them are renting and planning to do it for quite some time. They’ve kind of been inoculated against home ownership because of the foreclosure crisis.”
Cesarano agrees with Orr — for the short term.
“Short-term wise, they may not have the confidence because of student debt or other things that may have them pause in terms of home ownership,” Cesarano said. “But long-term, they feel confident over the next five years that they would be in a position to purchase a home, which is great.”
The BMO survey says that few people over the age of 55 plan to buy. It says only 5 percent plan to buy one this year and only 23 percent over the next five years. Cesarano said it may be because they’ve already been in their homes for a long time and intend to stay there.