Home ownership is a goal for many. Whether they are looking for a first home, a second home, or a rental property, and whether purchasing for themselves or a family member, many people aspire to being able to call themselves a homeowner. But with interest rates higher than they were in the early 2020s and home prices increasing around the country, not only are consumers questioning if now is the right time to purchase their first home, many who are already homeowners are staying where they are due to their current mortgage and interest rate being too good to pass up.

The good news: Aside from new-home loans, there are many other opportunities to get ahead.

Figure 1: Percentage of households anticipating home purchase within the next five years 

A revival in home purchase intentions
Millennials’ intention to purchase a home in the next year surges

Source: Lending, Raddon Research Insights, 2024

Home purchase intentions within the next five years are still top of mind for many, and over one in four Millennials hold this intention for the next year specifically (see Figure 1). Not only are we seeing their home purchase intentions in 2024 continuing into 2025, but data from our Deposit Baseline Study show that when consumers anticipate new account products, they tend to deliver on those goals and intentions the following year. It is a good idea to keep your finger on the pulse of what accountholders are intending to apply for and be sure your staff is having conversations with your consumers about their goals. The statistic that 26% of Millennials intend to purchase a new home in the next year shows the importance of opening that conversation.

Are your Millennial accountholders aware that your institution offers home loan services? Does your frontline staff print cashier’s checks for their rent payments? Knowing they are currently paying rent instead of a mortgage is the insight your staff needs to start these conversations and help consumers reach their goals.

Figure 2: Consumer sentiment around housing

The mortgage market is locked

Source: Lending, Raddon Research Insights, 2024

Aside from new-home purchases, there are other areas in the homeownership space that financial institutions can assist our accountholders with. While we saw that many Millennials intend to purchase a new home within the next 5 years, we can see in Figure 2 that the majority of consumers are not willing to take on a higher mortgage/interest rate than they currently have. That is where products such as home equity lines of credit (HELOCs) or home equity loans come into play.

Not only do 56% of homeowners plan to stay in their current home due to their low interest rate, 54% plan to remain in their current home because of the amount of equity they have gained. Why not help them build more equity in their current home with a HELOC so they can make upgrades, and in turn help them with their future new home purchase once they sell their current one and make a profit?

Figure 3: HELOC status or likelihood of taking out a HELOC in the next two years

Millennials are the primary target for home equity lending

Source: Lending, Raddon Research Insights, 2024

While 31% of Millennial homeowners currently have a home equity loan or HELOC, 40% stated that they are likely to take one out in the next two years. Keeping in mind consumers’ likelihood of following through on their product and service intentions, wanting to stay in their current home to save money, and visions of purchasing a new home within the next five years depending on the housing market, it is time we take advantage of their wants and needs and offer these lending options.

Millennials have been the topic of conversation for years when it comes to homeownership. Now that many have made that dream a reality, let’s continue that focus and help in other areas. Homeownership is not just about purchasing a first or new home; it also includes building a life and equity in the one you currently own.

As trusted advisors, how can your institution assist your accountholders in all aspects of homeownership, not only new home purchases?

• Equipping staff with discussion and talking points
• Educating accountholders on products and services your institution offers
• Showing accountholders the ease of use of online applications and adapting to decrease abandonment rates

Let’s help our consumers not only purchase a house, but build a home.