Millennials are known to be the weariest of generations when it comes to purchasing a home. After watching firsthand what happened to their parents and relatives during the Recession in 2007, many don’t think that buying would be in their best interest. Goldman Sachs research shows that around 30% of Millennials find purchasing a home important but not a priority. Therefore, they are dominating the renting industry.
Currently, home ownership rate for millennials is 13.2% a record low in the last thirty years. There are many factors persuading millennials to rent rather than purchase. Glaringly obvious is the $1 trillion in student loan debt and an unemployment rate of 8%. These numbers would stop anyone in their tracks from making a huge financial decision, such as purchasing a home. Combine that with rising rent prices and it makes it more difficult for some to save enough for a down payment.
Sociological reasons also affect millennials decisions to buy a home. Unlike their parents, millennials are getting married later in life and they’re 3 times more likely to change jobs than previous generations. This makes the idea of being tied to a home less attractive.
Now here’s the good news:
- As the market improves more and more millennials are seeing the financial benefits of home ownership.
- Millennials are sick of living at home and they’re quickly realizing rents are at record highs. Historically, when it’s cheaper to own a home in many markets than renting people buy, and they buy in droves. We’re starting to see this shift in the Charleston real estate market and surrounding areas.
- Low down payment loans are more readily available. Today a buyer can purchase with only 3% down and they don’t have to pay PMI. In some areas zero down loans are available. These programs will directly benefit these individuals and we should see the number of buyers from this group grow rapidly in 2016. For more on the 3% down & no PMI click here.
For additional information about our loan programs contact Eddie O’Neill at email@example.com.