Young homebuyers, those from the Gen Z and Millennial age groups, are waiting longer than past generations to buy their first houses. But that hasn’t stopped these first-timers from dreaming. Many prospective homebuyers pore over listings for hours and create specialty Pinterest boards with features of their favorite houses.
Opendoor’s 2019 survey says that 70 percent of single renters would prefer to stay in on a Sunday night and search home listings rather than log into a dating site.
Picky pays off: Millennials can afford more when they buy
Spending all that time virtually shopping means that up to 45 percent of millennials say they expect their first house to be their dream house. These younger homebuyers are okay with waiting, setting aside more money for a down payment, and being choosy about which listings they want to visit and must-have features they’re looking for.
Buying a home later in life than parents or grandparents has some advantages: Today’s young homebuyers are likely to have a stronger foundation in their careers before making such an important investment.
NAR’s Chief Economist Lawrence Yun explains:
“Older millennials are now entering the prime earning stages of their careers, and the size and costs of homes they purchase reflect this. Their choices are falling more in line with their Gen X and boomer counterparts.”
More savings and higher home equity are just two of the major homeownership benefits you’ll see in the first year.* Why not take the first step and get prequalified?
Some parts of the country with more competition for starter homes are forcing younger buyers to extend their wait. Setting extra money aside during this time gives young buyers the chance to expand their search to include bigger, and pricier, houses.
If things keep going the way they’re going, older millennial homebuyers may bypass the starter home completely. They’ll go straight to a premium or move-up home for their first purchase.
Loans are affordable, rates are low & the time is right
Most of today’s renters think a 20-percent down payment is required to buy a home. But this just isn’t true. The minimum requirement for an FHA loan is 3.5 percent. Plus, there are other low- or no-down-payment loan options to choose from. And, buying at today’s historically low rates could automatically bump you up into the next price range. Find out how.
*“Is buying a home actually worth it? 12 payoffs you’ll see in the first year.” HouseLoanBlog.net, Aug. 2019.
For educational purposes only. Please contact your qualified professional for specific guidance.
Sources are deemed reliable but not guaranteed.