Recently millennials, those born between 1981 and 1997, surpassed baby boomers as the largest share of homebuyers according to the 2015 NAR Home Buyer and Seller Generational Trends study. Overcoming generational hurdles like crippling student debt, post-recession low salaries and a more unstable lifestyle, more and more young people are entering the housing market. In fact, millennials are expected to form 20 million new households by 2025. While it’s perceived that millennials are postponing home ownership, studies show that over 49% of young renters say that their next move would likely be to own a home.
It can be scary to make such a large purchase, especially when you’re just starting your adult financial journey. However, knowing what to expect throughout the process can help things go much more smoothly. We spoke with several of our HomeCity Real Estate Experts to find out what advice they often give to their millennial clients.
Make an attack plan.
"I would suggest researching and exploring the area you want to live in before pulling the trigger,” advises agent Jessica Kasper. “Think about how your life will fit with your neighborhood. Consider things like your neighbors, commute, parks, trails, walkable shopping/restaurants, live music close by, quiet suburbs, and school districts".
Research first, but ultimately consult an expert.
"I would say that while starting your search and research online is fine, remember to take everything with a grain of salt,” warns agent Matt Witte. “Resources online may not pertain to your state, city, or even your unique situation. It is best to get in touch with a professional who keeps up-to-date on the market, the process involved, and has the resources to guide you that are most up-to-date."
"I advise every millennial to interview at least two real estate agents,” advises Broker Seth Thompson. “Not all agents are equal. When talking with an agent, how well do they know the area you are buying in, how well do they know contracts, what's their negotiation style, what technology will they provide to help you with this process? Interview two agents and hire the best match for you."
Assemble a rock star team.
"I would advise a buyer to get pre-qualified with a local, highly recommended lender before they start the process,” says agent Susan Ledesma. “It is so, so important to work as a team with a skilled local lender and a well-connected, experienced Realtor®! Your agent should be able to refer you to the best inspectors, contractors, and other parties involved as well."
Invest in the future.
"Remember to consider that you might eventually want to sell the house you’re currently looking to buy,” adds agent Josh Pruitt. “So be mindful of factors that could affect people that have different needs than you currently have. Things like having a master suite on the main floor, and quiet streets might not have any bearing on your decision, but they could be major factors when going to sell. Remember the old saying that 'you make money when buying a home not selling.' Do what you can to satisfy your requirements in a home, but remain mindful of the future as it will have a direct effect on how sellable your home will be."
The more you know, the better!
“Ask questions. Ask a lot of questions”, says agent Jen Glatz. “Ask your Realtor®, lender, and real estate team to help you think of questions you don't know to ask. We don't know what we don't know, so your team of experts are there to help you. Use them! Purchasing a home - especially the first time - is overwhelming, so submerge yourself in the process and learn as much as you can. Also, try to have a little fun along the way!”
“I would say, the best advice I can give to a younger person wanting to get involved in real estate, namely their first purchase, is, don't hesitate,” says agent Jonathan Bane. “My advice is seen as more aggressive. Don't go for the home that you are going to grow into ten years from now. I have too many clients who want the 4-bed bath home in the perfect neighborhood right now. With the way the Austin market is, thousands even tens of thousands over ask, it is more difficult to get this. I would tell that younger client to buy a condo or the smaller home so that it's WELL within their price range. Create an automatic savings plan - build net worth. There are many ways to grow wealth in real estate and being patient and decisive will yield the best results.”
Enjoy the ride.
“The home buying process is like jumping on a roller coaster ride,” says agent Melissa Peel. “You will experience different emotions through your home buying process, but at the end of this exuberant ride you will end up with an amazing story to share with your friends.”