TransUnion expects millennial housing boom in next few years
Over the next five years, TransUnion estimates that potentially 17.1 million first-time homebuyers will enter the housing market.
For its analysis, TransUnion developed a model that examined thousands of credit scores and attributes determining credit worthiness and likelihood to purchase a home. The resulting “First-Time Homebuyer Propensity Model” identified specific consumers with the highest probability to become first-time homebuyers. Using this model, TransUnion determined that there could be as many as three million first-time homebuyers over the next year.
This would add a significant number of consumers to the mortgage pool. For comparison, 6.2 million consumers acquired a new mortgage in 2015 and almost half of these were first-time homebuyers.
TransUnion’s projections are based on U.S. consumers who do not currently have a mortgage, coupled with long-term estimates for growth in the mortgage purchase market and the percentage of first-time homebuyers in the traditional mortgage market.
The study shows that millennial consumers aged 20-39 will likely represent the majority of first-time homebuyers. In 2015, consumers in this age group represented 60% of first-time homebuyers, up from 44% since 2000. Read more at TheFinancialBrand.