The Millennial Home Buyer is Not Who You Think They Are
Written By: Tommy Oâ€™Shaughnessy
Monday, February 04, 2019
79 of Millennials are first-time home buyers, but they donrsquo;t want starter homes
Almost 80 of Millennials aged 18-34 are first-time home buyers. Theyrsquo;re unfamiliar with the home buying process, and 61 are working with a real estate agent nbsp;to help them learn. However, 39 of Millennials arenrsquo;t using a real estate agent. These first-time home buyers need help, but theyrsquo;re not tapping into agents whose fees are typically paid by the seller.
These buyers are inexperienced, but they are also tech-savvy, using online resources to do their own research. 75 of Millennial respondents are using online listing sites like Zillow and Redfin to research and find homes.
Millennials are thinking long term about their first home; most respondents prioritize neighborhood safety 38 and a quality school district 35 over walkability 11 and short commutes 11. Millennial rentersnbsp;might be looking for luxury amenities and locations near bars and restaurants, but Millennial home buyers very different.
Many respondents were looking for ldquo;more spacerdquo; and ldquo;a forever home.rdquo;
In other words, the Millennials buying 8 chai tea lattes and looking for cute 500 square foot downtown apartments arenrsquo;t the ones buying real estate.
Millennials are looking for affordable homes they can fix up
Millennials between the ages of 25 and 34 have an average of 42,000 in debt, so theyrsquo;re thinking realistically about their purchase. Over two-thirds of Millennial surveyed said theyrsquo;d be willing to put in an offer on a fixer-upper that required major repairs, and more than half are looking for a home thatrsquo;s less than 200,000.
However, Millennials that arenrsquo;t handy might be getting themselves in trouble. Homeowners spent an average of 6,649 on home improvements per household in 2018, and the average kitchen remodel costs 22,145. Millennials eager to buy homes need to be aware of the true cost of homeownership.
84 Millennials believe homeownership is part of the American Dream and a great investment
While many Generation Xers and Baby Boomers are looking to settle down in a quiet single-family home, 14 of Millennials are planning on buying multi-family homes that can generate income and help cover their mortgage. Theyrsquo;re 52 more likely than older generations to purchase a multi-family home.
Millennials understand real estate investing can be a viable path to financial freedom and help pay the bills along the way. 43 of Millennials believe buying a home is more affordable than renting, and another 43 believe real estate is a good investment.
In spite of the challenges Millennials face, an overwhelming majority believe homeownership is part of the American Dream. Their path might be rocky, expensive and filled with holes in their roof, but Millennials are still finding ways to break into the housing market.
About the Author:nbsp;Tommy Orsquo;Shaughnessy is a Research Analyst at Clever Real Estate who conducts surveys, analyzes data and studies trends to understand the real estate market.
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