Currently there is a plethora of Millennials looking to either buy or rent homes in the near future. As a matter of fact, during the summer of 2018 Millennial home ownership numbers rose by roughly 65%. Many of these people were first-time homebuyers, which was a big reason why there was such a large increase in sales.
Millennials are coming on strong in the rental and homeownership market. They make great money in the tech industry and other thriving sectors, so they can afford to live in the most expensive modern high-rises and lofts for rent.
This newest generation of renters and property owners has preferences and expectations unlike other generations before them. But we’ve been paying attention and recognize millennial real estate trends and feel comfortable telling you about them right now. If you’d like to learn what we know, stick with us for a little while longer to ascertain our thoughts and ideas on the matter.
1. Rising Interest Rates Have Caused Millennials to Rethink Their Plans for Buying New Homes
For all intents and purposes, it looks like interest rates for mortgages are on the rise. This is changing the parameters for many Millennial homebuyers currently looking to purchase property today. With higher interest rates, they have less purchasing power than they originally believed.
As rates go up, even if they rise only one quarter of a point, it will have a major impact on purchasing power for Millennial homebuyers. So these young and intelligent individuals are going to take their time when looking at the real estate market. They are going to look for the best deals because they are savvy, smart, and aren’t looking to overextend themselves in the least.
Many Millennials have a good grasp on interest rates and they understand how money works. They aren’t ready to spend more than they can afford only to find themselves in financial trouble in the near future.
Investors and real estate agents should know that Millennial homebuyers are very careful when making a purchase. They aren’t willing to jump into the first deal that comes across their path.
On the contrary, they are going to thoroughly analyze the property, the price, their potential mortgage options, their down payment, their PMI expenses, and everything else that goes along with buying a house. And they are going to figure out which house or property is best for them based on their calculations.
Guess what? This means Millennials are going to haggle with property owners to get their price. So be prepared to help them do whatever it takes to acquire the home they’ve always dreamed about.
2. Baby Boomers Now Have Competition from Millennial Homebuyers
Because Millennials are achieving so much success, their ability to purchase property has gone through the roof. Believe it or not, current estimates say that Millennials bought about 30% of the homes in the $300,000 price range and above in the years 2017 and 2018. Over the last five years, this represents a 14% increase.
Even better, since Millennials now have more available spending money to buy property, the baby boomers suddenly have competition. They no longer rule the roost when it comes to buying multi-family homes, single-family homes, and luxury apartments. It appears that this trend isn’t going to change anytime soon and should last for many years to come.
Since Millennials and baby boomers both want many of the same things, it’s creating big competition. Millennials want great homes and apartments with wonderful amenities. They want to live in the best neighborhoods. They want pharmacies, schools, and grocery stores right around the corner from their home. Just like their Baby Boomer counterparts. So these young folks will continue to duke it out with baby boomers for the best homes and apartments available today.
3. Millennials Have No Problem Getting Their Hands Dirty
Some people are under the false impression that Millennials are afraid of hard work. Nothing could be further from the truth. When it comes to building their dream home, they are willing to remodel and renovate themselves instead of hiring a contractor to do it for them.
Guess what? Because they are willing to do this type of DIY work, their labor costs remain nearly nonexistent. If they can get friends and family members to help them, they only have to pay for material costs during home renovations.
Do you know what else? Savvy Millennial shoppers are looking for good deals on rundown and inexpensive homes. They want homes and apartments that need work. They aren’t afraid to put in the labor needed to fix these places up. So you should help them find affordable properties that need a little TLC to make these homes more than presentable.
Clearly, the Millennial generation really has their head on straight. They aren’t as willing to throw away their money like Baby Boomers and Generation X. They understand money better than previous generations and have no trouble putting in hard work to fix up their latest property purchase. Use this valuable information to help Millennial homebuyers find the ideal home to help them live their dreams.