Helpful Tips For Millennial Home Buyers

Helpful Tips For Millennial Home Buyers

If you have been reading anything about the real estate market or industry, or even any news at all, you have probably seen the word “Millennial” popping up all over the place. It seems like everyone is trying to predict what this next generation is going to do. From home buying, to jobs, to saving for retirement, to when they are getting married, to when they are having children; everyone is weighing in with their opinions on what this generation is currently doing and should be doing. The focus comes with good reason. The millennial generation of Americans now represents the largest portion of the population in the US.

So, What is a Millennial?

The “Millennial” generation refers to those Americans born between 1980 and the mid 2000’s, individuals who are in the 18-35 year old age bracket, and they represent roughly one-third of the total population (as of 2013). This generation grew up with the internet and were coming of age when the recession and housing crisis hit. Although the economy and housing markets have made a rebound since 2008, there are a large group of millennials that find themselves struggling with unemployment, debt and student loans. It is a stark contrast to the generations of their parents and grandparents, a time where buying a home and starting a family in your 20’s was commonplace. Now, as many millennials are reaching the age where they are considering the purchase of a home, they are often finding themselves faced with a few hurdles. Although it may be more difficult for some young adults to become homeowners today than it was for prior generations, there are still plenty of opportunities and benefits to doing so.

It is important for millennial home buyers to keep the big picture in mind. Although there was a period of time between 2005-2012 where real estate values dropped dramatically, if you look at prices historically, they continue to increase. As with every market, there are ups and downs. If you are able to maintain a strong foundation financially, you can ride out the swings and you will see the value home ownership can offer.

How Can a Millennial Have the Best Home Buying Experience?

Work with a Professional

Millennials often have the “DIY” approach and with today’s technology, information has never been easier to get. This is the generation that has everything at their fingertips. The game has been changed for many different industries and housing is no exception. Sites like Zillow and Trulia make it easy for potential home buyers to research neighborhoods and view properties. And while many agents fear that these new players in the market will make them obsolete, I think we should embrace them. Being more educated about the market yourself can only help you in your home search. However, as convenient as these new tools are, they are no replacement for a great agent.

No matter how many virtual tours you look at and open houses you attend, you will still be limited in your understanding of the real estate buying process. There is much more to a transaction than simply finding your perfect home and buying it. A great agent can help guide you through the process and make sure nothing is overlooked. They can advise you based on their knowledge of the market, neighborhoods, contracts, disclosures and more. A good agent is also an expert at negotiating, and in today’s market, Millennials want to ensure they are getting the best price for their home, while making sure their offer is accepted. The key here, is finding a “great” agent.

Most of the millennial generation is going to fall under the “First Time Home Buyer” category. Unless you have purchased a home before, pretty much all of the home buying process is going to be new, and although you may be nervous, a great agent will help to manage the process and keep things running smoothly.

Finding the Right Real Estate Agent

As first time home buyers, the right agent can be crucial to your success. Although you, as the buyer, have all of the power in decision-making, it is the agent who will be providing you with the information. This is why it is so important to find that “great” agent, one that you can trust.

You may be asking yourself how you’d go about finding your own rockstar agent, but fear not, there are many different ways to find the agent that works best for you... You could walk into an open house, do a quick google search, or ask a friend or family for a recommendation and very easily be able to find an agent. While you may find an agent this way, it is a good approach to interview a few agents that you are considering and then choose the one you would like to work with based on your trust and interactions with them. Ask them about their experience in the industry, if they have any recommendations from recent clients, and how many other clients they have worked with in the past and are currently working with. It is not always the best approach to work with the top agent in an area if they have numerous clients that they are working with at once. You can bet that you will not get as much time dedicated to you as with another agent that is only working with a small number of clients. Remember, you are the “boss” in this situation, if you are not happy with an agent that you are interviewing or working with, don’t work with them!

Talk with Your Friends and Family who Have Purchased a Home

Purchasing a home is often one of the largest, if not the largest purchase in someone’s lifetime. Talking with friends and family who have purchased a home can give you a lot of insight on the process and can help to ease your nerves if you are hesitant. The important thing is to discuss this decision with those who you trust. Everyone has their own opinions, and although they may have had a bad experience in their past, it does not mean that you will face the same issues.

Find Your Perfect Location

I’m sure you’ve heard it before - “location, location, location!” This is a common saying when it comes to real estate because it’s very important. The location and neighborhood of your home is the biggest factor in it’s value. A savvy home buyer will not only look to find a home that is “perfect” for them, but they will also take into consideration the future resale value of the home. Factors such as crime rates, school districts, neighborhood walkability, or even property located next to a commercial area or on a busy street, can all affect your ability to resell the property. Take some time to drive or walk around the neighborhoods you are considering moving to. Have a dinner date at one of the local restaurants or drinks at a local bar. This will help you to get a better idea if the area is right for you.

What Type of Home is Right for You?

Single family, multi-family, condo, townhouse, mobile home and more. There are a wide variety of housing styles available, it is up to you to decide what option is personally best as there are positives and negatives to each. Take some time to think of where you would like to be and how the space will work for you. Single family homes in the suburbs can be great if you need more space and would like a yard, but keep in mind that this will require more upkeep than say, a condo downtown. Remember, there is no “right” answer, it is what fits your lifestyle and personal needs.

Understand the Costs of Home Ownership

Before purchasing your first home, it is important to keep in mind the ongoing costs of owning a home. Along with the transactional costs in purchasing a home, your home will require ongoing maintenance which will be an investment of both time and money. This is another topic that may be good to discuss with family and friends that own a home. After all, if you finally have your dream home, you will want to maintain it so that it holds its value for years to come!

Celebrate When You’ve Purchased Your Dream Home!

Congratulations, you are a homeowner! You have successfully found your dream home and now you have the keys. Enjoy your new space and make it your own! Throw a housewarming party for friends and family, post pictures to social media, and be proud to show off your beautiful new home. Get to know the neighborhood, take a walk, talk to neighbors, explore more of the restaurants and bars in the area. Take pride in your home and take good care of it, and it will provide you with memories and equity for years to come.

Regardless of your age, the home buying process should be an exciting and positive experience that provides you with benefits for years to come. Millennials, along with everyone else, should not be afraid of purchasing a home. Oftentimes the process is much easier than imagined. If you are considering the purchase of a home, meet with a lender and/ or real estate agent to discuss your individual situation and see what options are available to you. These days there are many creative financing options available that make owning a home more accessible than ever.