Millennials home buyers are shaping up to be a key force in the housing market’s rebound.
The group accounts for more than half of all new home loan applications, as it has since last year, according to the Wall Street Journal.
A cohort ranging in age from mid-20s to late 30s, millennials are often associated with renting. Fallout from the housing bubble bursting in 2007 and 2008, coupled with student debt, kept many from purchasing. Now, it appears that home ownership for the group was just delayed.
“We anticipate as they turn 31 and 32, we’ll just see homebuying demand grow,” Odeta Kushi, deputy chief economist at First American Financial Corp, told the Journal.
According to the National Association of Realtors, millennials accounted for 38 percent of all homebuyers in the year ending last July, an increase from 32 percent in 2015.
“What the industry’s been talking about for a decade is whether they’re going to follow their predecessor generations in terms of their desire to own homes,” Rick Arvielo, chief executive of mortgage lender New American Funding, told the Journal. It turns out, he said, “they have the same desires.” [WSJ] — Sylvia Varnham O’Regan
Boston real estate for sale, millennials are entering their peak condo buying years. Millennials have waited longer than any other generation to become Boston real estate homeowners, but the wait for this cohort is just about over.
According to National Mortgage News,
“Millennials, those young adults now aged 23 to 38, are now entering their peak household formation and homebuying years.”
If you’re a Millennial, you’re already well aware that you’re among a generation of those who favor fast-paced, real-time answers – and results. When you’re ready to make a decision, it’s go-time, and you probably want the latest Boston real estate for sale technology at your fingertips to make it happen.
“Millennials are different than previous generations—not only in their delayed homebuying but also in how they approach interactions with financial institutions, including mortgage lenders. Taking a picture of a check on their phone and depositing it without visiting a branch is not novel, it’s the way Millennials learned to do banking. They expect real-time access to account and transaction data and are frustrated when it’s not available.”
Here’s the catch – the overall speed of the Boston condo for sale buying process can take some time, and it might feel like it is slowing you down. When you’re ready to buy, you can make an offer and go under contract quickly, but the rest of the process might take a little longer. The same article explains why:
“When Millennials apply for a loan, the mortgage lender must qualify the borrower and determine who owns the property, how much the property is worth, and the property’s risk profile. Traditionally, this has been one of the most time-consuming and fragmented parts of the mortgage process…There are many moving pieces, each data point being sourced from a different provider, which can ultimately lead to a lengthy or delayed process.
What has historically been accepted as the process norm does not align with the expectations of the most prominent generation in the home buying market today. Millennials have come to expect rapid, digital workflows in their daily purchase decisions, and in their mind, the home buying process shouldn’t be any different.”
If you’re pre-approved for a mortgage, that will help speed things up. But the steps it takes and the time to finalize a loan with most traditional lenders may feel like an eternity to you and your generational peers. Don’t worry, though – it’s well worth the wait when you finally get the keys to your new Beacon Hill condo or Midtown condo
The financial benefits of homeownership, like increasing your net worth by building equity, and the non-financial benefits, like being able to customize and improve your space, will ultimately set you on the course to happiness, success, overall satisfaction, and much, much more.