NEW YORK (MainStreet)As Millennials age into their early 30s, the typical age for a first-time home buyer, realtors and housing experts say the new crop of young buyers are postponing their entry into the housing market.
"First time home buyers are waiting longer and are older than they used to be," said Jane von Holzhausen, a seasoned real estate agent and manager at Coldwell Banker Residential Group in Avon, Conn.
Millennials are renting longer or living at home, and when they do they spend it's in a higher bracket above a classical "starter home," von Holzhausen said on the emerging pattern of older first-time buyers.
The median age for a first-time homebuyer in the U.S. has ranged between 30 and 32 over the last 30 years, according to statistics from the National Realty Association.
The slow pace of economic recovery along with tightened credit and the staggering amount of outstanding student debt - toward $1 trillion - is packing a punch on Gen-Yers (22 - 33) who are waiting longer to pay down student debt and save for a first home.The number of student loans borrowers is approaching 40 million nationally, including 40% of 25-year-olds, with the average balance of $25,000, according to the Federal Reserve Bank of New York.
With tightened credit, many defaulting young borrowers are no longer able to qualify loans - especially mortgages. In 2005, nearly 9% of 25- to 30-year-olds with student debt were granted a mortgage. But last year, that percentage dropped to slightly above 4%, according to a FRBNY report.
"Delinquent student loan borrowers have a very difficult time accessing credit and the share of those borrowers is greater today than in the past," said Donghoon Lee, a senior economist at the New York Fed and one of the authors of the report.