Millennials are well known as hopeless optimists except when it comes to one thing: the process of buying a house. Despite their reputation of forever living with their parents, Millennials are actually buying more homes than ever before. They now make up 66% of all first-time homebuyers, and 34% of homebuyers overall.
We can all learn something valuable from the cautious way Millennial buyers approach the homebuying process. Here are six tips that apply to everyone.
After watching their parents and relatives go through the Great Recession of the 2000s, young homebuyers have seen firsthand the costs of making a bad decision in the process of buying a house. That’s the real reason many Millennials move back in with their parents—to save up enough money for a full, 20% down payment.
Beyond moving back in with parents, there are many simple ways to cut back on unnecessary purchases and save up the money for a significant down payment. Cutting back on daily Starbucks runs, eating at home more often than dining out, and watching Netflix rather than buying pricy movie tickets are all easy ways to save up.
Similarly, once you’ve met with a lender and have a homebuying budget in mind, it’s smart to stick to that budget. It can be tempting to spend more than you were planning to after you tour that perfect dream house. But in the long run, spending more than you can afford on a monthly mortgage payment is likely to be harmful to your overall financial wellbeing.
Never assume you can’t afford to buy a home. Meet with a lender early to explore the many programs available, including down payment assistance programs.
Beyond carefully saving for a down payment, Millennials also do plenty of research and clearly identify what they’re looking for in a home before starting the search. Buying a home is a huge step for anyone, and planning ahead is key in making the best choices.
Millennials are known for being bargain hunters, and that translates into homebuying as well. Even in the hottest markets, a good real estate agent will be able to guide you to neighborhoods and areas where you can find a bargain.
Millennials are returning to the knitting, jam-making, DIY ways of their grandparents, and that mindset can be hugely helpful once you’re a homeowner. Picking up some basic carpentry, plumbing and electrical skills will save you so much money when it comes to home repairs and improvements.
Just starting the process of buying a house? Contact one of our sales reps today.