As homeownership keeps slipping among young American adults, real estate analysts expect the makeup of first-time homebuyers could look very different over the next 10 years.
In a quarterly survey conducted by Zillow and Pulsenomics, a panel of economists, real estate experts, and market strategists agreed that the median age of first-time homebuyers is likely to keep moving up in the next decade as millennials wait until later in their lives to purchase.
Among the more than 100 experts polled, 61 percent said they expect the median first-time homebuyer age to rise marginally in the coming years, reaching 32 or 33 by 2024. Another 24 percent say that figure could climb even higher, rising to 34 years or older.
The typical first-time homebuyer in 2013 was 31 years old, according to the National Association of Realtors.
The panel's predictions come at a time when homeownership in the United States is hovering at a near 20-year low, with the biggest declines coming among younger and early middle-aged Americans. Analysts have pointed to student loan debts and limit job prospects as two of the biggest factors keeping down millennial homeownership, though Zillow chief economist Dr. Stan Humphries said there are other influences at work.
"Because of its huge size and great diversity of housing preferences and opinions, the Millennial generation will have enormous influence in coming years, especially as they hold off on getting married and having children, the two biggest reasons for first-time home purchases," Humphries said.
"But while the age of first-time homebuyers may rise, it is dangerous to assume Millennials don't want to buy at all," he added, pointing to research done by the company that suggests millions of renters—millennials included—want to purchase a home soon, despite obstacles that might delay them.
In the meantime, a declining homeownership rate could create larger problems, "keeping rents high and potentially impacting the broader economy if substantially fewer people pay property taxes and buy fewer home goods," Humphries said.
The survey also polled panelists on their home value expectations, with most agreeing that U.S. median home values will end this year at an estimated $177,895, a 4.6 percent increase from 2013. That pace is expected to slow in each of the next four years, with values exceeding peak levels by the end of 2017.
According to Zillow, the most optimistic group of panelists anticipate a 5.6 percent annual increase in home values in 2014, while the most pessimistic predicted an average increase of 3.7 percent.
"The dispersion of the experts' home value projections has diminished to the lowest level in the history of this survey, and for the second consecutive quarter, the expected five-year average annual growth rate in U.S. home values is the same as that experienced during the pre-bubble era," said Terry Loebs, founder of Pulsenomics. "Although one would expect to observe trends like this in a calming housing market, it's way too soon to conclude that the market has healed and returned to the old normal."