Photo Credit: The Ballen Group
The millennials have quite a reputation. Defined by technology, smart phones and convenience, their upcoming economic affects are bound to be interesting. A recent study by TD Bank showed that these millennial buyers are actually very important to the housing market. The study showed that 2/3 of millennials are saving money to buy their first home.
“It’s encouraging to see millennials thoughtfully prepare to enter the housing market,” says Scott Haymore, head of pricing and secondary markets at TD Bank.
74 percent of millennials said saving for a downpayment was the biggest hurdle. However, Some mortgage plans can help them face this issue and purchase even sooner.
65 percent of all consumers admitted that saving for a downpayment is a big challenge.
“For many consumers, a 20 percent downpayment is a major barrier to homeownership,” Haymore says. “It’s often difficult to save this much cash, especially for young adults saddled with substantial student loan debt. First-time buyers are shopping for low-down payment mortgage programs, which allow buyers to put as little as 3 percent down.”
The millennial market has other things to organize, too. According to Florida Realtors, 17 percent of first-time buyers have not set aside money for unexpected repairs and costs, which is probably why nearly half (44 percent) of millennials incurred up to $5,000 in unexpected costs during the mortgage process.
“The costs of running a household can be a shock to new homeowners,” Haymore says. “Monthly expenses for utilities, homeowner’s association fees, cable and Internet can add up quickly. Factoring these in at the beginning of the mortgage process can help borrowers assess their overall budget and determine a realistic monthly mortgage payment.”
It is a great sign for the future of our housing market that millennials are excited to enter it. If you’re a millennial yourself and ready to purchase your first home in Miami, Contact me today!