15 Dec Millennials – It’s Time to Stop Renting
Now here’s an incentive for Millennials to get off the fence about buying their first home.
According to a recent Builder Online article, it is now more affordable to own a home than it was 15 years ago. It’s also more cost effective to buy rather than rent. Homebuyers can expect to pay 15.3 percent of the area median income (AMI) on mortgage payments, compared with the 29.9 percent of AMI renters can expect to pay, nearly twice as much.
One of the biggest challenges for Millennials is saving up for a down payment. Most of their current income goes toward rent, education and car loans; a 3 percent down payment can certainly be a hurdle.
Now that rent is growing less affordable and buying conditions are more attractive, 2015 looks like it will be a big year for millennial homebuyers, who could surpass Gen Xers on their way to becoming the largest generation of home owners.
Current shifts that are happening in millennial buying behavior over next six months, according to a 2016 CoreLogic survey:
- Millennials are more likely to buy in counties that have a strong and prospering economy.
- Millennials are more likely to buy where they are making more money, indicating that areas with an improving job market are where this demographic is more inclined to buy.
- There will be a shift in the next six months where millennials will purchase homes; from cheaper areas that border improving counties to the heart of the improving counties in which the housing market is more expensive.
Millennials are well on their way.