People with ages 30 and below are normally known as the millennials. In the recent times, millennials are very apparent in the housing market as they make the 45% of the total population of rookie home buyers. However, every single one of them is faced with great challenges when it comes to buying and owning properties.
Millennials as Home Buyers: The Dream
There are reasons why they are called millennials. Aside from the fact that they are the group of people who reached their young adulthood in the 21st century, there are distinct characteristics that separate them from other generations. The most apparent factor is the advancement of technology.
Technology has been a great companion to every millennial. This is largely the reason why this has a huge factor in millennials when buying homes and properties.
Normally, millennials are seen to be very attracted to the idea of energy-efficiency. They would prefer homes with amenities that cater advanced features to suffice their daily needs and wants. For instance, they would rather opt for properties that have solar panels than houses with ordinary energy sources. It is seen that this young generation is much more drawn to green features that will likely help them save more in the long run.
In addition, these young adults would love to buy properties that are “instagrammable.” It has become a trend already. The appearance, feature, and ambiance of a property are great deciding factors for them since posting Instagram-worthy photos on different social media platforms is a real deal.
This is the dream of every millennial home buyer.
These conditions are plausible, but the real question is – can millennials afford the properties they want?
Millennials as Home Buyers: The Reality
When talking about financial matters, this is where the reality hits. Essentially, 80% of millennials today wanted to own a property during the current age but only 55% of this rate THINK that they can buy one. The truth is the prices of homes and properties today are out of reach for many millennials.
The average price of a new home in the recent times is seen to be rated at $300,200 excluding the special features that any millennial would want to see in their properties. The market is significantly competitive due to fewer homes are being sold and the number of people who are looking to buy is high. Hence, the market is lacking affordable homes and millennials are largely affected.
FACT 1: This group of people is young adults who are either still in the process of building their career paths or just got out of schools and universities. Therefore, paying off student loans are still apparent.
FACT 2: Millennials see buying properties as financial investments but, unfortunately, taking the first step into buying homes which is paying off the down payment is already a struggle.
FACT 3: Millennials thought that they are saving that much since they have been working too hard but according to the recent data, one-third of the millennial home buyers cannot afford the 20% down payment.
FACT 4: On an average note, millennials could only afford 11% of the down payment.
FACT 5: Home and property sales are continuously dropping nowadays. This makes the prices of every property rise.
FACT 6: Renting is very much apparent in the recent times. This kind of alternative pushes away the potential home buyers. Aside from the fact that the market for renting properties and homes is expanding, the option to rent is quite cheaper and much affordable to many millennials.