It seems like almost every new data point on housing shows weakness. That’s because even though millennials are entering their prime age for home buying, starter homes have become unaffordable. Housing prices for houses less than 75% of the cost of median houses increased 8.9% from September 2016 to September 2017 which was above the 6.4% increase for all homes. Millennials are delaying home buying which is also delaying peak demand. The most common age is 27 in 2018. Millennials waiting until their early 30s to buy a house pushes off this demand. Even though the labor market is extremely robust as weekly wage growth is at a cycle high and the underemployment rate is at a cycle low, shelter inflation outperforming overall CPI has taken a toll on affordability.