Millennial House Buying Trends and Tips
Millennials will be a significant force in home buying over the next coming years. Contrary to popular belief, many Millennials do want to become homeowners, not just perpetual renters. There are some trends that will be rising as the Millennial population begins their housing search, and there are some reasons they may not be able to become homeowners. Take a look at where things might be heading:
- There are over 66 million millennials in the U.S.
- The median age for first time buyers is 31 and that has stayed the same for nearly 40 years.
- Approximately two-thirds of millennials haven’t reached age of 31 yet.
- Most millennials rent for about five years before purchasing a home.
Potential Millennial Homebuying Trends:
As many millennials are tech-savy, it is predicted that over 99% will use the internet to find homes. Following the rise in online house hunting, realty search sites will be continuously updating to accommodate for this, and will include new selling techniques like “virtual house showings.” Millennials tend to be researchers by nature and we will be seeing a trend in doing most things from the click of a button – from hiring movers to meeting neighbors online.
Tips For Millennials Looking To Buy:
- Pay off debt- most millennials are in debt because of student loans (the average amount of student loan debt for a millennial is $38,000). With the addition of credit card debt, car payments, and other loans, paying off sooner can make way for saving up for a down payment. Utilize a financial consultant or a financial adviser to help you create a payment AND a savings plan. HINT: if you take our Homebuyer Education class, financial counseling is part of the process and can help put you on the right track to homeownership!
- Start small and save big. You may have heard this advice before, but there is a reason so many people say to look at your spending and make small changes. That $3.49 ice coffee you pick up every morning on your way to work adds up to just over $900 a year. We’re not saying stop all together, but by making your ice coffee at home even just have the time could result in a large chunk of money towards your home. CAUTION: don’t just “not spend it” physically (or through a handy app) take that $3.49 a day and put it into an account so you actually see that savings build.
- Make yourself known in a competitive market and get pre-approved before making any offers. Then find a realtor that you are comfortable with and work with them from start to finish. When you build relationships between your lender and your realtor, you will find the process much easier.
- Know what you can spend and then stick with that and find an affordable home. While this may mean taking a bit longer to find your dream home, be patient and buy within your means.
- Make sure to get a home inspection! These are crucial in making smart buying decisions and the inspection will tell you what kind of home you are buying. Does the home have some foreseeable big money projects (ie: rotting sills) or will the home be a good investment?
Millennials have a lot on their plates, like trying to find a good steady job after college and paying off debt from student loans. Here at RealtyWorks and NeighborWorks of Western Vermont, we can help every step of the way – from budgeting to finding your dream home. Call us today at 802-438-2303 to find out more.
Authors: Bailey Aines, NeighborWorks of Western Vermont part-time employee and Svea Howard, Communications and Outreach Coordinator of NeighborWorks of Western Vermont.