What Millennial Home Buyers Want
Millennials—those born between 1980 and 1998—are reshaping American consumer trends, workplaces, and industries. In fact, millennials are now the largest generation of home buyers, making up 37 percent of the market, according to the National Association of Realtors 2019 report on generational trends. So, what do millennials want when it comes to buying a home?
More than other generations, they’re considering homes that fit their lifestyles, incorporate technology, and come in under budget.
Millennial homebuyers are looking for homes and neighborhoods that fit in with their current lifestyles. Although most choose houses in suburban areas, they still want to take advantage of the entertainment, employment, and cultural aspects of city life. Among young millennials (age 21-29), 71 percent say convenient access to work influenced their neighborhood choice, and 41 percent listed commuting costs as “very important.”
As the first generation of digital natives, millennials have grown up with quick access to the internet, and technology is incorporated into every aspect of their lives. Naturally, tech plays an important role in their home search, mortgage application, and buying processes. Local and nationwide realty search engines have become the top method for marketing homes for purchase, and 81 percent of older millennials found their home using a mobile app.
Additionally, smart home features are in demand, especially for those in their 30s. Even small upgrades like the addition of electrical outlets with USB ports can add value for this segment of home buyers.
While they recognize real estate as an important and valuable investment, today’s young adults are often under financial constraints; 45 percent have student loan debt at the time of home purchase, with a median balance of $30,000.
For this reason, Federal Housing Administration (FHA) loans are particularly appealing to this generation of purchasers. With down payments as low as 3.5 percent and accommodations for those with low or no credit, FHA loans can create a viable path to homeownership for millennials who are still balancing other debts.
If you have questions about the loan options available to you, speak with an Open Mortgage loan specialist or visit OpenMortgage.com today.