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Millennials

Study Shows “Millennials Deserve More Credit”

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Study Shows "Millennials Deserve More Credit" | Simplifying The Market

When it comes to talking about millennials, there are many stereotypes out there that have influenced the way the public feels about the generation. Whether it’s the assumption that millennials are irresponsible with money and would rather buy avocado toast than save for a down payment, or that millennials jump from job to job, the majority of these stereotypes paint the generation in a negative light.

A new study by Bank of America entitled Better Money Habits Millennial Report recently came to the defense of the generation when it reported that:

“Millennials deserve more credit – both from themselves and from others – for their mindfulness when it comes to money and their lives.”

Here are some key takeaways from the study proving that millennials deserve more credit for what they are already doing:

  • 63% are saving – (47% have $15,000 or more in savings)
  • 54% are budgeting – (73% who have a budget stick to it every month)
  • 57% have a savings goal – (67% who have a goal stick to it every month)
  • 46% have asked for a raise in the past 2 years – (80% who asked for a raise got one)
  • 59% feel financially secure – (16% have $100,000 or more in savings)

Many have wondered if millennials even want to own their own homes or if they would choose to rent instead. Well, not only do they want to own their own homes, but many already do and are looking to trade up! A recent study by realtor.com shows that 49% of Americans who plan to sell their home in the next 12 months are millennials!

Danielle Hale, realtor.com’s Chief Economist, gave some insight into why millennials are looking to sell,

“The housing shortage forced many first-time homebuyers to consider smaller homes and condos as a way to literally get their foot in the door. Our survey data reveals that we may see more of these homes hitting the market in the next year.”

Bottom Line

Not every millennial fits into the stereotypes that are so prominent in our society. Those who have risen above the stereotype are ready and willing to buy a home of their own, and many others already have!

5 Reasons Millennials Choose to Buy [INFOGRAPHIC]

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5 Reasons Millennials Choose to Buy [INFOGRAPHIC] | Simplifying The Market

Some Highlights:

  • “The majority of millennials said they consider owning a home more sensible than renting for both financial and lifestyle reasons — including control of living space, flexibility in future decisions, privacy and security, and living in a nice home.”
  • The top reason millennials choose to buy is to have control over their living space, at 93%.
  • Many millennials who rent a home or apartment prior to buying their own homes dream of the day when they will be able to paint the walls whatever color they’d like, or renovate an outdated part of their living space.

Millennials Flock Towards Low Down Payment Programs

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Millennials Flock Towards Low Down Payment Programs | Simplifying The Market

A report released by Down Payment Resource shows that 61% of first-time homebuyers purchased their homes with a down payment of 6% or less.

The trend continued among all buyers with a mortgage, as 73% made a down payment of less than 20%.

An article by Chase points to a new wave of millennial homebuyers:

“We teamed up with Google to help us better understand what customers are searching for and how the home buying landscape is evolving. We found that millennials and first-time homebuyers are making a big splash in the market, and affordability remains top of mind.”

Among millennials who purchased homes, David Norris, Loan Depot’s Head of Retail Lending, said:

“It’s clear from the survey results that Millennials have a lot of anxiety built up about the home buying process.

There is good news, however, as there’s more flexibility than most Millennials think regarding how to qualify for a loan and what’s needed for a down payment.”

Bottom Line

If you are one of the many millennials who is debating a home purchase this year, let’s get together to help you understand your options and set you on the path to preapproval.

Builder Offering to Pay Off Student Loans for Buyers

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Builder Offering to Pay Off Student Loans for Buyers | Simplifying The Market Millennials are on track to become the most educated generation in history. This means they are also the generation with the most student debt. Depending on the type of degree earned, as well as the prestige of the institution attended, there are some millennials who graduate college with what equates to a mortgage payment. For those first-time buyers, and even some move-up buyers, who took advantage of the First-Time Homebuyer Tax Credit in 2008, there is an interesting program being introduced by Lennar Home Builders and Eagle Home Mortgage.
“Borrowers with Eagle Home Mortgage’s Student Loan Debt Mortgage Program can direct up to 3% of the purchase price (up to $13,000) to pay their student loans when they buy a new home from Lennar, one of the nation’s largest homebuilders. The contribution doesn’t directly increase the purchase price of the home or add to the balance of the loan.”
The program allows borrowers, whose credit and income requirements qualify, to put down as low as 3% and have a maximum loan amount of $424,100. At the time of closing, Lennar contributes up to 3% to pay down student loans incurred while attending universities, colleges, community colleges, trade schools and other certificate-granting programs. Jimmy Timmons, President of Eagle Home Mortgage, gave more context about the reasons behind the creation of the program,
“Americans are more burdened than ever by student loans, with $1.3 trillion in outstanding student loans spread out among 42 million borrowers.   Particularly with millennial buyers, people who want to buy a home of their own are not feeling as though they can move forward. Our program is designed to relieve some of that burden and remove that barrier to owning a home.”
According to the Wall Street Journal, “housing observers said other builders are likely to look to mimic the program, which could help lure more of the critical first-time-buyer segment into home purchases.”

Bottom Line

If you are one of the many millennials who may have delayed purchasing your first home, or feel stuck in a house that no longer fits your needs, there are programs and options available to help you achieve your dream!

Should I Buy a Home Now? Or Wait Until Next Year? [INFOGRAPHIC]

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Should I Buy a Home Now? Or Wait Until Next Year? [INFOGRAPHIC]| Simplifying The Market

Should I Buy a Home Now? Or Wait Until Next Year? [INFOGRAPHIC]| Simplifying The Market

Some Highlights:

  • The Cost of Waiting to Buy is defined as the additional funds it would take to buy a home if prices & interest rates were to increase over a period of time.
  • Freddie Mac predicts interest rates to rise to 4.4% by next year.
  • CoreLogic predicts home prices to appreciate by 5.0% over the next 12 months.
  • If you are ready and willing to buy your dream home, find out if you are able to!

What to Look for in Your Real Estate Team

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What to Look for in Your Real Estate Team | Simplifying The Market

How do you select the members of your team who are going to help you make your dream of owning a home a reality? What should you be looking for? How do you know if you’ve found the right agent or lender?

The most important characteristic that you should be looking for in your agent is someone who is going to take the time to really educate you on the choices available to you and your ability to buy in today’s market.

As Dave Ramsey, the financial guru, advises:

“When getting help with money, whether it’s insurance, real estate or investments, you should always look for someone with the heart of a teacher, not the heart of a salesman.”

Do your research. Ask your friends and family for recommendations of professionals whom they have used in the past and have had good experiences with.

Look for members of your team who will be honest and trustworthy; after all, you will be trusting them with helping you make one of the biggest financial decisions of your life.

Whether this is your first or fifth time buying a home, you want to make sure that you have an agent who is going to have the tough conversations with you, not just the easy ones. If your offer isn’t accepted by the seller, or they think that there may be something wrong with the home that you’ve fallen in love with, you would rather know what they think than make a costly mistake.

According to a Consumer Housing Trends Study, millennials have already started to prefer a more hands-on approach to their real estate experience:

“While older generations rely on real estate agents for information and expertise, millennials expect real estate agents to become trusted advisers and strategic partners.”

Look for someone to invest in your family’s future with you. You want an agent who isn’t focused on the transaction but is instead focused on helping you understand the process while helping you find your dream home.

Bottom Line

In this world of Google searches, where it seems like all the answers are just a mouse-click away, you need an agent who is going to educate you and share the information that you need to know before you even know you need it.