Are Millennials Cheating Themselves by Buying Homes Later?

NEW YORK (TheStreet) -- Millennials, the generation born from the early '80s to early '00s, have been starting families and buying homes later than their predecessors, thanks to the Great Recession and its ripple effects. Many experts have assumed this is temporary. But what if it isn't? Are these young folks cheating themselves?

A survey by Zillow, the online home marketplace, suggests this pattern could have legs, with first-homebuyers' average age rising to 32 over the next 10 years, from 31 last year and 30 in the years before the housing collapse of the mid-2000s. 

The survey of housing experts looks only at millennials who do buy, while many others are just continuing to rent or live with parents. Nationally, the homeownership rate has fallen to less than 65%, from 69% just before the housing collapse.

"The national homeownership rate fell in the second quarter, and a majority of experts said they expect it to fall further in coming years as the millennial generation delays home purchases and the age of typical first-time homebuyers rises," Zillow says.

Read More: Investing in Single-Family Homes Isn't as Easy as Many Hope

This can be sobering news for homebuilders and companies that sell home furnishings. Because those are big industries, a slowdown in household formation is not good for the economy.

But it doesn't necessarily mean millennials are on the road to financial ruin. 

On the downside, home prices will probably rise over the next decade, so folks who postpone a first purchase will miss some appreciation and pay more. Interest rates are also likely to rise, pushing up the cost of that first home even more. Buying later rather than sooner also means missing out on benefits such as the federal tax deduction for mortgage interest.

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