SALT LAKE CITY — As more millennials move into the stage of life where buying a home is more of a priority, fewer are now applying for mortgages in the state of Utah.
Construction Coverage reviewed data from the Federal Financial Institutions Examination Council's '2023 Home Mortgage Disclosure Act' to determine where millennials are buying homes and how much of a share that generation accounts for in mortgage applications.
The study found that Utah ranked 17th among states for largest share of homebuyers that are millennials in 2024. That compared to 2023's ranking of 8th shows a drop in the state's homebuyers. Salt Lake City ranked 18th in the analysis' 2024 rankings among large metros. That's down from 6th in 2023.
Construction Coverage attributes the dramatic shift in mortgage originations among millennials to the difficult home-buying landscape across the U.S.. They say that conditions like, interest rates among other forces brought mortgage originations down to $334 billion in Q1 of 2023, the lowest levels in two decades.
Researchers also say that due to the rising prices, millennials are taking out larger home loans with higher loan-to-value ratios. In 2022, the median loan amount for mortgages taken out by applicants age 25-34 was $315,000 and $365,000 for applicants age 35-44. The loan-to-value ratio, or the amount of the mortgage compared to the sale price of the home was 87% for 25 to 34 year-olds and 80% for 35 to 44 year-olds. Analysts say that gap can be attributed to millennials being largely first-time home-buyers and therefor having less existing home equity to apply to mortgages.
Despite the difficulties associated with home-buying, millennials still make up a large amount of people applying for mortgages. In Salt Lake City, 63.8% of home purchase loans were taken out by millennials. That number is down however from 2023 where millennials made up 67.1% of home loan applications.
San Jose-Sunnyvale-Santa Clara, California had the largest share of millennial home buyers in 2024, according to the study, at 73.5%. San Francisco-Oakland, California came in second(69.1%) and Seattle-Tacoma-Bellevue, Washington came in third(68.7%) for 2024.
If you are wondering which states ranked in the top for most share of millennial home buyers, Massachusetts, New York, and New Jersey came in at the top of the list. Delaware, Florida, and South Carolina ranked in the bottom.
