Millennials apparently are buying homes -- despite the. They're just buying in the less-expensive suburbs. And that's fueling a sales boom in the nation's lesser known hamlets, such as Wautauga, Texas, and Hilliard, Ohio, according to new research.
"We're finding that the hottest markets are affordable pockets where a millennial can have success," said Javier Vivas, director of economic research at Realtor.com. "If you're getting good square-footage for a reasonable price, it's going to be a magnet. And it's a plus if you're near hiking trails and hipster hotspots where you can find great restaurants and nightlife."
To find the nation's hottest housing markets, Realtor.com analyzed home sales in 32,000 locations based on the time it takes properties to sell and how often homes in each of the zip codes were viewed. Homes in those markets this year sold in 21 days -- 50 days faster than the national average -- and they were viewed four times more often than the national average.
Notably, oft-criticized millennials make up a disproportionate share of buyers in eight out of 10 cities on this year's list. That generation is increasingly important to not only real estate but to all sorts of retailers because millennials have surpassed the baby boom generation in size. The US now has 75.4 million people between the ages of 18 and 34.
Realtor.com looked at older members of this generation -- those from 25 to 34 -- and found that their average home ownership rate in the 10 hottest zip codes is 50 percent versus 41 percent nationally.
What are the nation's hottest real estate zip codes, and what factors appear to be generating sales in these communities? According to Realtor.com:
1. Watauga, Texas: A suburb of Fort Worth, Watauga supports a strong economy, great restaurants and proximity to attractions, including the Kimbell Art Museum and the Fort Worth Zoo. It also brags about schools that are rated among the best in the state. Average home listing views are up 28 percent this year, generating five times more interest than the national average. Homes sell in an average of 18 days, with a median listing price of $160,441.
2. Livonia, Michigan: Just outside of Detroit, Livonia is less than a half hour from the Detroit Institute of Art, the historic Easter Market commercial district and the stadiums of four professional sports teams. The city itself boasts more than 60 parks and has been ranked among Michigan's safest towns. More than 86 percent of millennials living in this zip code own their own homes. The average listing in Livonia sells in 21 days and has a median listing price of $223,780.
3. Kentwood, Michigan: On the western edge of Michigan, just outside of Grand Rapids, lies the community of Kentwood, which piggybacks on Grand Rapids' booming economy, vibrant public arts competition and renowned local breweries. Millennials boast a 62 percent home ownership rate in Kentwood and account for 42 percent of all new mortgage applications. The median home listing price is a modest $118,833, and homes sell in an average of 16 days.
4. Medford, Massachusetts: A once sleepy suburb of Boston, Medford is known for lively restaurants, the Mystic River arts celebration and ample recreation opportunities. Homes in Medford sell in an average of 19 days, with a median list price of $541,158, up nearly 13 percent from last year.
5. Littleton, Colorado: The Denver suburbs, long known for their physical beauty, have also become a mecca for outdoor enthusiasts, with hiking, skiing and biking trails throughout the region. Littleton also boasts great shopping and a fun historic downtown. Millennials account for 34 percent of all new mortgage applications in this city where houses sell in an average of 22 days and the median listing price is $533,873.
6. Castro Valley, California: Near Silicon Valley's vibrant technology hub, Castro Valley is a relatively affordable community that's equidistant to downtown San Francisco, Berkeley and Silicon Valley, making it a perfect spot for two-income couples who work in different parts of the region. Median listing prices are $728,267, and houses sell in an average of 23 days.
7. Colorado Springs, Colorado: Ringed by military bases, El Paso County -- the home of Colorado Springs -- has been called one of the healthiest counties in America. With its own airport and university, Colorado Springs is also booming economically. Millennial home ownership rates are at 68 percent. Homes sell in an average of 21 days and have a median listing price of $273,322.
8. Overland Park, Kansas: A suburb of Kansas City, Overland Park benefits from a strong economy and attractive amenities such as the Atkins Museum of Art and the 50-acre Corporate Woods. Millennials account for 39 percent of new mortgages. Houses sell in an average of 24 days, and the median listing price is $236,454.
9. Mira Mesa, California: This northern San Diego community, once populated primarily by military families, has become a booming area for microbreweries and shopping. Located only 15 minutes from the beach and bordered by a 5,800-acre nature preserve called Mission Trails, homes in the area sell in an average of 22 days. The median listing price is $536,394.
10. Hilliard, Ohio: Just outside of Columbus, lies the hamlet of Hilliard, which boasts historic charm, excellent schools and superb housing values for the cost-conscious. Millennials account for 41 percent of the new mortgage applications in this town where the median home sales price is $259,011 and houses sell in an average of 25 days.
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