Recently published evidence shows that Millennials, the generation of persons born between 1980 and 2000, are now the largest group (35 percent) of home buyers.

Historically, the share of first-time buyers has been 40 percent, but the National Association of Realtors pegs the current share at just 30 percent.

Since Millennials are the largest home-buying segment, the question arises as to what is keeping them from investing in their first homes. A number of reasons have surfaced, some based on solid evidence and some anecdotal:

1. Shortage of low-priced homes: Redfin reports that the overall inventory of homes for sale fell by 0.7 percent in March 2016, the first drop since December 2013. Tight inventory tends to cause prices to rise, thereby reducing the supply of low-priced homes for sale. Part of the problem is that about 7 million homeowners are "underwater" (they owe more on their mortgage than a home sale will fetch) and therefore reluctant to sell. Although this problem is improving, tight credit and weak wage growth discourage many potential sellers from trading up to more expensive homes.

2. Student loan debt looms: MarketWatch reveals that the U.S. class of 2015 has the greatest amount of student debt in history. The average graduating student will owe just over $35,000 in loans, up $2,000 from 2014. Higher tuitions, declining federal and state funding, and stagnant wages are responsible for the peak in student debt. Naturally, money diverted to repaying student loans cannot be applied to home buying. In addition, a heavy student loan burden can depress credit scores, making it more difficult to obtain affordable mortgage terms.

3. Tight standard for mortgage lending: According to the Urban Institute, tight credit standards prevented 5.2 million mortgages in the 6-year period ending in 2014. Although there are some signs that standards are starting to relax a little, banks remain fearful of litigation from governmental agencies over lax lending procedures, one of the major contributors to the mortgage meltdown of 2008.

4. Heightened expectations: A survey from the National Association of Retailers reveals that 69 percent of respondents are willing to postpone home purchasing until they can afford a long-term home, rather than investing in a starter home. More than 50 percent felt that the kind of homes they desire are unaffordable right now.

5. Reaction to the Great Recession: Adam Deermount, Managing Director of Landmark Capital Advisors, advances the theory that Millennials are more conservative with their money as a result of the Great Recession, just as the 1929 Depression traumatized its generation. Millennials likely either knew of or belonged to families that suffered because of the housing crisis of 2008. Also coloring Millennials' thinking is the prospect of being stuck in a home permanently, if it isn't the home of their dreams. After witnessing so many homeowners with underwater mortgages, Millennials don't want to get stuck in a starter home if the market collapses again.

If you are considering the purchase of your first home, have a look at our Guide To Mortgages And Buying A Home. It's chocked full of important information that can save you money and help you avoid surprises.

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