What All Millennial Home Buyers Should Know

Millennial Home Buyers
fotolia

Key Things Millennial Home Buyers Must Know

Millennials are a group of individuals born in the 1980s and 1990s and are within the ages of 18 and 36. Also known as generation Y, many are sidelined by tight credit, high student loan debts, and low paying jobs. In fact, until the past few years, these have been the key reasons they were slow to enter the real estate market. Now, they make up well over 30% of new home buyers and that trend should continue going up as they start to mature and pay off existing debt.

Compared to previous generations, such as baby boomers or the silent generation, these younger individuals have a different outlook when it comes to long-term investment, especially owning a home. One thing you can bank on is that Millennials know what they want in a home!

Read on to learn more about millennial home buyers, key characteristics of this generation, as well as a look at their attitude towards real estate investment. If you happen to be a millennial, you will learn how easily it really is to prepare and become a homeowner.

Characteristics of Millennial Home Buyers

These characteristics will help you understand the millennial demographic and tip you off if you are unsure if you are one (between the ages of 18 and 36)....

  • 66 percent of millennial home buyers are first time home buyers
  • Their median income is approximately $82,000 per year
  • 66 percent of these buyers are married couples
  • 50 percent of these buyers say that the main reason for buying a house is the desire to own a home
  • 20 percent of them previously lived with their parents, relatives, or friends
  • 24 percent of them owned a previous residence
  • 56 percent of them rented a house or an apartment

Millennial Home Buyers Attitudes Towards Real Estate Investment

  1. Many millennials want to own homes or invest in real estate. In one of the studies conducted by the National Journal Heartland Monitor, 69 percent of the younger generation in the U.S. generally regard home ownership or real estate investment as a smart and achievable goal.
  2. Some millennials are scared to own a home because of the upfront costs they are facing. As homes go up in price, so do the costs associated with owning those homes. However, it is not just higher prices that may be putting some of this generation off. The thought of settling in a new place or living in different circumstances also sounds unattractive. Some, therefore, find renting an attractive option because of its affordability and flexibility.
  3. About 20 percent of the respondents in the U.S. feel that although owning a home is a smart move, this decision is not financially viable for them right now. Of the respondents, there are more minorities who feel their finances probably would not enable them buy a home. All millennial buyers have options so check with a local lender before writing homeownership off as a distant dream.
  4. Because some millennials are hesitant on home buying or real estate investing, they will continue to rent houses and apartments until their situation changes and they are more comfortable. As their needs change, rent prices will creep up, which will force many to purchase a house. In fact, according to a new study conducted by Choice Home Warranty, 30 percent of millennials plan to buy a house in 5 years’ time.

In a nutshell, whatever challenges you may be facing, buying a home as a millennial is a smart and achievable goal. If it is money that is preventing you from achieving this goal, you need to come up with a strict financial saving plan or find a way to acquire the funds as a gift from a family member. As you would expect, there are always financial institutions that are ready to help millennials get mortgage loans, even those with less than desirable credit scores.

How to Meet Your Home Ownership Needs

  1. First, you must understand the type of house you want to buy. According to a new study conducted by the National Association of Home Builders, most millennials tend to invest their money in homes that are older, smaller and less expensive. The main reason for this is that many millennials have not accumulated enough wealth to purchase new, bigger or expensive homes.
  2. You must also figure out things you want in the home. These are basically the things that drive you to buy a home to begin with. According to a survey conducted by Metrostudy, a Houston based national housing research firm, millennial buyers are looking for small but high-quality homes, especially in the suburbs. Some of them also look for homes with flexible space to entertain family and friends rather than larger properties to keep all their "stuff".
  3. You must know where to find your preferred home. With many agents posting listings on their websites, and via social media, it is very easy for millennials to find what they want before they even view the first property. Because many use their smartphone for home searches, they can quickly and easily search for new listings, get more information about the available inventory, and find details about the owner/home long before they contact a local real estate agent for assistance.

There are many real estate options for millennials right now and this definitely includes their ability to purchase a home. Now that many are settling down and having families, the appeal to own their own home is a strong pull. That is why agents need to market to this demographic. Those that do will benefit from dealing with savvy and knowledgeable consumers who know what they want and have a plan to make it happen.

 

 

Similar Articles

Red House Keyring

Let’s paint the scene. You’ve acquired or scouted some property that’s perfect to rent out. You’re ecstatic at the opportunity, despite having no experience as a landlord prior to this. As far as you can tell, everything seems good - but this is a big undertaking

Villa

There are some tips on buying a villa for making money off it which is very important for you to know.

Winning the Right Home in a Competitive Market

There have been several hot markets around the country the last couple years and it can be hard for buyers to get the upper edge. Homes are selling for more than the listing price with-in mere days of being posted to the MLS. 

real estate market

“the customer is always right” is one phrase that you can never get enough of, especially when you see mediocre customer services being given at any outlet stores. The idea has been ingrained in the minds of the customers so deeply that they often overlook their own unreasonable demands. 

sold

Sometimes selling your home is just as exciting as buying it as this marks a new chapter in your life. To get that new chapter off to the best possible start, you want to be making as much for your old home as possible. Here we’ve rounded up some of our best tips for selling your home.

Apartment

There are lots of studio apartments around the world. There are so many people's around the world who are looking to rent a studio apartment. Dubai is a famous place. It’s a dream place for everyone to rent his or her studio apartment.

Realtor vs. for Sale by Owner: Which Yields More Money?

Planning to sell your home? Then you might be contemplating whether to involve a realtor or to opt for the For Sale by Owner route. Either way, the keys to successful selling are appropriate pricing and, of course, having a strategic marketing plan in place.

Prepare For The Home Inspection When Selling Your House

Want to make your home sale a pleasant experience without much fuss? For many home sellers, the home inspection is arguably the scariest part of the sale process. You’ve listed your home with a real estate agent and probably received a nice offer on your home.

How to Bump Up The Value of Your Home

Are you planning to sell your home? If you are planning to sell your house, you may just want to start to think like a buyer instead of a seller. Why? It is simple - as a buyer, you are more likely to look at a home or property in a critical way