Millennials are increasingly using Veterans Affairs loans to become homeowners. The number of loans backed by the Department of Veterans Affairs rose 2.3% annually in September. The uptick was led by a 14% jump in the number of mortgages for millennial veterans and active-duty military personnel, according to a report by Veterans United, one of the nation’s largest VA lenders.
“There has been a question in real estate circles for years about when millennials are going to start buying,” says Chris Birk, director of education for Veterans United. Some young buyers are jumping in sooner than their peers because of VA loans, he says. “They don’t have to spend years saving for a down payment,” he notes.
VA loans allow qualified veterans and service members to purchase a home with no down payment and no mortgage insurance.
Borrowers aged 23 to 38 comprised 211,276 loans, which is a 34% share of the mortgages backed by the VA from September 2019 to September 2018. The total number of VA loans issued during that time period was 624,332. The number of borrowers between the ages of 23 to 38 who took out a VA loan during that time is up 30% from a year earlier.
Millennials and Generation Z buyers comprised 45% of all VA purchase loans in the last fiscal year ending September 30.
The top cities for millennial and Generation Z buyers who used a VA loan from September 2019 to September 2018 were:
- Jacksonville, N.C.
- Killeen-Temple-Fort Hood metro area, Texas
- Oklahoma City
- El Paso, Texas
- Fort Walton Beach-Crestview-Destin metro area, Fla.
- Austin-Round Rock, Texas
- Jacksonville, Fla.
- Tampa-St. Petersburg-Clearwater metro area, Fla.
- Augusta-Richmond County, Ga.
- Las Vegas
Source: Veterans United Home Loans and “VA Mortgage Lending Increased 2.3% Led by Millennials,” HousingWire (Oct. 23, 2019)
