In Colorado, millennials have become one of the most influential groups in real estate. Between 2018 and 2023, many reached key life stages—marriage, kids, career growth—that pushed them into the housing market. But what they want, and where they’re looking, often breaks from tradition. Some are heading to Denver suburbs for more space, others are buying second homes in mountain towns, and many are navigating student loans and down payment hurdles. From Boulder to Colorado Springs, millennial homebuyers are reshaping demand, driven by lifestyle, flexibility, and a changing economy.

Colorado’s Millennial Homebuyers: An Overview

As of 2022, just over half of Colorado’s millennials owned their homes. This was a notable milestone – it’s the first time a majority of millennials have become homeowners, although their homeownership rate still lags behind what older generations had at the same age. In fact, across the U.S., 62% of 40-year-old millennials owned homes in 2022, compared to 69% of baby boomers when they were 40.

By 2023, buyers aged roughly 25 to 44 (essentially the millennial generation) were responsible for about 60% of home purchase loans in Colorado, one of the highest proportions in the nation.

One reason millennials are so prominent in Colorado’s housing market is simple demographics. Colorado’s population has many people in their late 20s and 30s – the prime age for first-time home buying. The state’s robust job growth and attractive lifestyle have drawn young adults from elsewhere as well. For instance, Colorado Springs topped the charts for millennial population growth in a Brookings Institution study, thanks to a booming job market and quality of life in the mountains.

Housing Preferences: What They’re Buying

Single-Family Focus

Millennial buyers in Colorado are purchasing a range of home types, but detached single-family houses are by far the most common choice. Like prior generations, most millennials say they want a house with space for a growing family. Many are looking for features such as a yard, a garage, and extra rooms that can serve as a home office.

A survey in 2021 found that millennials were seeking homes around 2,400 square feet on average – a big increase (about 40% larger) compared to before the pandemic, when they looked for 1,700 square feet on average. This suggests that after spending time cooped up during COVID-19, young buyers began prioritizing more living space. They want houses where they have room to work remotely, accommodate children or pets, and enjoy some privacy.

Outdoor Space Priority

Because of these preferences, single-family homes (often in suburban neighborhoods) have been highly sought after by millennials. In Colorado, detached houses with yards are attractive to those who love outdoor activities and need space for gear, gardening, or pets. Nearly half of millennials surveyed said that outdoor living space was a top priority for them. Additionally, about 30% of millennials in their 20s said a good yard for their dog was a main factor in choosing a home – reflecting the importance of pets and outdoor recreation in their lifestyle.

Alternative Housing Types

Not all millennials have been buying large suburban houses. Some, especially in urban areas like downtown Denver, have purchased condominiums or townhomes. Condos and townhouses often cost less than detached homes, making them appealing to first-time buyers on a budget. They also require less maintenance (no yard work) and can be closer to city jobs and entertainment.

However, only a minority of millennial buyers choose condos, as most still prefer a traditional house if they can afford it. Millennials often end up buying older homes as a trade-off – they purchase older or fixer-upper houses more often than other age groups, because these homes tend to be cheaper.

Life Stages: First-Time Buyers to Upsizers

Age and Buying Patterns

As millennials age through their 30s, many have been “upsizing” – moving from starter homes into larger homes. The millennial generation covers a span of ages, so within 2018–2023 we saw different stages. Younger millennials (in their mid-20s to early 30s) were mostly first-time homebuyers, often moving out of rentals. In fact, about 71% of home purchases by millennials under 35 were first-time purchases, meaning these buyers had never owned a home before.

By contrast, older millennials (mid-30s to early 40s) were more likely to be repeat buyers. Only 36% of older millennials were first-time buyers – implying that around two-thirds had owned a home previously and were now buying again. This often means they were selling a starter condo or small house and upsizing to a larger home to fit their growing families or gain more space.

The Upsizing Trend

Upsizing has been a common pattern. For example, a millennial couple that bought a small Denver condo in their 20s might, in their 30s, sell it and purchase a single-family house in a suburb like Arvada or Highlands Ranch to get an extra bedroom and a yard for the kids. Many older millennials in Colorado have gotten married and had children during this period, which tends to spur a move to bigger housing. Data shows a high share of millennial buyers were married couples (about 66% of older millennials), and dual incomes helped some afford a larger home.

Additionally, millennials who bought during the mid-2010s often gained equity as home prices rose, allowing them to trade up to a pricier house by the early 2020s.

Vacation Home Trend

One interesting trend is some millennials buying vacation homes or second homes. Traditionally, second-home buyers skew older (Gen X and Boomers), but a subset of affluent or adventurous millennials joined in during the housing boom of 2020-2021. Colorado’s resort towns and scenic areas saw surging demand for vacation properties in that period.

Mountain communities such as Summit County (Breckenridge area), Eagle County (Vail), and San Miguel County (Telluride) experienced a rush of buyers seeking getaway homes amid the pandemic’s remote-work era. In 2021, for example, the Telluride region had record sales, with 944 properties sold, many to out-of-town buyers. In 2022, sales volume there dropped (582 sales) as the market cooled, but the average sale price still jumped over 26% compared to the prior year.

That said, millennial purchases of vacation homes were still a small slice of the pie. Most millennials focused on primary residences.

Regional Differences Across Colorado

Denver Metro Area

The Denver Metro area (including Denver, Aurora, and surrounding suburbs) contains the largest number of millennial buyers simply due to population. Denver has a vibrant job market that attracts young professionals, but it also has high home prices. Many Denver millennials initially rent in the city and then buy homes in the metro suburbs when they’re ready. Within the seven-county Denver metro area, median home sale prices hovered around $625,000 in 2023, which is a steep hurdle for first-time buyers.

Colorado Springs: A Millennial Magnet

Colorado Springs, about an hour south of Denver, has become extremely popular with millennials. It offers a strong job market (including tech and defense jobs), and housing costs that, while rising, are generally lower than Denver’s. The city’s population grew rapidly, up 37% since 2000, fueled in part by millennial newcomers.

By 2022, almost 65% of millennials in Colorado Springs owned their home (only ~35% were renting), one of the highest young-adult homeownership rates in the nation. This is likely because many millennials moving to Colorado Springs specifically came to settle down – they can find single-family homes there at prices that might be unattainable in Denver or Boulder.

Western Slope and Mountain Towns

Colorado’s Western Slope and mountain towns present a different picture. The Western Slope (the western side of the Rockies, including cities like Grand Junction and Durango) and mountain resort areas (like Vail, Aspen, Steamboat Springs) are less populated and have fewer total millennial buyers, but these regions saw unique trends.

Some Western Slope communities offer relatively affordable housing and a quieter lifestyle, which can attract millennials who can work remotely or prefer small-town life. For instance, Grand Junction (Mesa County) has had lower median prices than Denver, making it appealing for young families who don’t need to be on the Front Range.

Mountain resort areas, on the other hand, often have extremely high prices – far out of reach for most local millennials. Homes in ski resort counties frequently top $1 million in median value. In places like Summit County (Breckenridge) and Eagle County (Vail), many millennial residents continue to rent or live in multi-family housing because buying is so expensive.

The pandemic did allow some younger remote workers with high-paying jobs to relocate to mountain towns. These “amenity migrants” included millennials who decided to trade city life for a home in a scenic area, even if it meant paying a premium. Their presence, along with ongoing retiree and investor demand, caused mountain home prices to spike in 2020–2021. For example, the average sale price in Summit County was 13% higher in 2022 than in 2021.

Financing Strategies and Challenges

Interest Rate Rollercoaster

One of the biggest factors influencing millennial homebuying was the rollercoaster of mortgage interest rates. In 2018, 30-year fixed mortgage rates were roughly around 4.5% APR, a fairly normal level historically. By early 2020, during the pandemic, the average 30-year mortgage rate fell to record lows near 3%.

Many millennials jumped at this chance to buy with cheap financing. A huge wave of first-time buyers locked in 30-year loans in 2020 and 2021 when rates hovered in the 2.7%–3.5% range. However, this situation reversed sharply in 2022. The Federal Reserve raised rates to combat inflation, and mortgage rates more than doubled in one year. In January 2022 a buyer could get a loan at ~3.2%, but by December 2022 the same loan was about 6.4%.

Such a rapid rise had a chilling effect: it priced some millennials out and made others pause their home search. By 2023, rates remained high (around 6-7%), meaning millennials needed larger incomes or budgets to afford the same homes.

Down Payment Strategies

Millennial buyers have also relied on a variety of mortgage types and down payment assistance. Many first-time millennial buyers use FHA loans or other government-backed loans that allow smaller down payments. These loans are popular because coming up with a 20% down payment is challenging for young adults.

According to surveys, about two-thirds of millennials planned to put down less than 20% of the purchase price. In fact, a significant portion had help from family: 33% of younger millennials (typically first-timers) received a gift or loan from relatives to help fund their down payment.

Even with these aids, millennials often ended up with high loan-to-value ratios. In 2022, the median mortgage amount for buyers ages 25–34 was $315,000, and for ages 35–44 it was $365,000 – higher than any other age group. This corresponded to younger millennials financing nearly 90% of their home’s value (only about 10% down on average), whereas older millennials who had existing home equity were able to put roughly 20% down (financing ~80% of the value).

Student Debt Impact

Another factor in financing was the impact of student debt and credit conditions. A large share of millennials carry student loan debt – around 43% of younger millennial buyers had student loans, with a median balance of $30,000. This debt affects their debt-to-income ratio and can make it harder to qualify for mortgages or save for down payments.

Lenders in the late 2010s and early 2020s did begin to account more for consistent rental payment history and adjusted some rules to make it easier for student-debt-burdened borrowers to get loans. Nevertheless, high debt loads and only moderate wage growth meant many millennials had to buy with smaller down payments and mortgage insurance, or delay buying until they improved their finances.

Economic and Lifestyle Factors

Affordability Challenges

On the economic side, home prices and affordability were a constant concern. Colorado experienced steep home price increases during this period. Statewide, home values rose roughly 50% between 2018 and 2023. Home price growth far outpaced income growth, which means homes became less affordable for first-time buyers.

A national index of house-price-to-income ratio reached 135 (2015=100) by 2022, indicating house prices grew about 35% faster than incomes since 2015. Millennials, often early in their careers during this time, felt this acutely. Many had decent jobs but found that inflation in home prices (and rents) outstripped their wage increases, making it hard to save for a down payment or to afford monthly mortgage costs.

Remote Work Revolution

The COVID-19 pandemic triggered a widespread remote work revolution. Suddenly, many millennials who used to work in offices found themselves working from home. Nearly 90% of organizations worldwide adopted remote work at the height of the pandemic. This change made millennials rethink their housing needs and location choices.

If you no longer need to commute daily, you might choose to live further from the city or even in a different part of Colorado for a better quality of life. Indeed, a portion of millennials took advantage of remote work to move to larger homes or more affordable areas. Some left Denver for outlying towns or moved from other states to Colorado, since they could now work from anywhere with an internet connection.

Remote work also meant homes needed space for home offices. About 31% of millennials said that having a dedicated office space at home became one of their top needs when home shopping. This influenced the kind of homes they bought (favoring those with extra bedrooms or dens).

Family Formation Timing

Other lifestyle factors include family formation and marriage timing. Millennials have tended to marry and have children a little later than previous generations, but by the late 2010s many were entering those life stages. Marriage or partnership often increases buying power (two incomes) and motivation to buy a house.

Likewise, having children is a big push factor to seek a stable home (many millennials wanted to move out of apartments once kids came into the picture, in search of more space and access to better schools). By 2018–2023, a significant number of millennials were transitioning from their 20s to their 30s, bringing major life changes that encourage homeownership.

Historical Comparison: 2008-2017 vs. 2018-2023

The decade leading up to 2018 was very different for millennial homeownership, largely because of where millennials were in life and the broader economic climate. From 2008 to 2017, many millennials were in their late teens or 20s – just starting careers, often renting, and some still in school.

The period began with the Great Recession (2008–2009), which hit the job market hard and made it difficult for young adults to gain a financial foothold. In those years, relatively few millennials could afford to buy homes, and those who wanted to often struggled with tight credit and lack of savings.

Key Differences Between Periods

When we compare 2008–2017 vs 2018–2023, a few key differences emerge:

Millennial Age and Homeownership Rate

In 2008 the oldest millennials were 27. By 2023 the oldest were 42. This maturation led to a huge jump in homeownership. Around 2010, only a small minority of millennials owned homes (nationally, roughly 30-40% of under-35s owned homes). By 2022, 51.4% of millennials were homeowners – the first time a majority have owned. So the latter period shows millennials crossing into majority homeowner status, whereas the earlier period they were mostly a generation of renters.

Share of Homebuyers

Millennials went from being newcomers in the market to the dominant buying force. Around 2013–2015, millennials surpassed Gen X as the largest group of homebuyers, taking about 32% of the U.S. market at that time. In Colorado by 2018–2023, millennials were roughly fifty to sixty percent of buyers. In contrast, in the late 2000s, Baby Boomers and Gen X led home purchases and millennials made up a much smaller fraction due to youth.

Market Conditions

The 2008–2012 housing market was a buyer’s market with plentiful supply (after the foreclosure crisis), which ironically benefited some millennials who had the means to buy cheaply. But most were too early in their careers or cautious.

The 2013–2017 market saw recovery and rising prices, yet interest rates were moderate (~4% on average). Then 2018–2021 had rapidly rising prices and eventually record-low interest rates, fueling a frenzy where millennials had to compete fiercely. By 2022–2023, a new challenge of high interest rates emerged.

In short, earlier millennials faced a weak economy but cheaper houses; later millennials faced a strong economy but far more expensive houses and volatile mortgage rates.

Homebuying Behavior

Millennials in the earlier period often delayed buying – the median age of first-time buyers crept up during the 2010s. It used to be in the late 20s or around 30 in the 1990s, but by 2017 the median first-time buyer age was roughly 32, and by 2022 it hit 36. This shows that millennials in 2018–2023 were buying later than those in 2008–2017 (who in turn were later than prior generations).

To sum up, 2008–2017 was the period of millennials dipping their toes into homeownership, often cautiously, whereas 2018–2023 was the period of millennials diving in head-first and, in many ways, transforming Colorado’s housing market. The latter period saw them assert themselves as the key buyer demographic, despite challenges of affordability.

By the end of 2023, Colorado’s housing trends clearly bore the imprint of the millennial generation: a strong demand for family homes, a push for more space (thanks to remote work and growing families), and ongoing struggles with affordability that will likely shape the market for years to come as even younger generations start to enter the fray.

References

• The Race to Homeownership: Gen Z Tracking Ahead of Their Parents’ Generation, Millennials Tracking Behind
• Where Are Millennials Buying Homes in the U.S.? [2024 Edition] – Construction Coverage
• Millennial Homeownership Statistics 2023 – Self Financial
• A Booming Job Market And Cheaper Housing Are Luring Millennials To Colorado Springs
• What Millennials want in a Colorado home – ColoradoBiz
• Home Buyers and Sellers Generational Trends – National Association of Realtors
• 2022: A year of change in real estate – Colorado Association of REALTORS
• More Colorado houses hit the market, but sitting around longer – Colorado Sun
• Colorado Housing Market: House Prices & Trends – Redfin
• Colorado House Price Index Quarterly Analysis: FHFA House Price Index – YCharts
• High Rent Pushing More Millennials to Consider Buying – Colorado Association of REALTORS
• Younger Householders Drove Rebound in U.S. Homeownership – U.S. Census Bureau