1. What you are seeing with people looking to buy who are in the millennial age range (22-37)?
We continue to see a strong desire to get into the real estate market. However, more and more kids coming out of college are taking jobs in states that they have never resided in, with the goal of getting back to their home towns someday and settling down near their family and friends. This transitional existence is not that conducive to owning real estate.
2. Are they buying homes and when?
Yes, typically when they decide to settle down in one location they get serious about buying. The millennial’s we have helped finance have been very inquisitive and detail oriented. They have all been good about studying their financial pictures and not pulling the trigger on a purchase until they had their “financial house” in order. They all went through our pre-approval process and asked great questions along the way. From what we can tell, they are all happy they jumped into the real estate market.
3. What are some money saving tips you would give to someone in that age range looking to buy a home?
First and foremost, live below your means. It’s simple, spend less than you make and only go into debt to buy a home and to finance a car that you need to get yourself around if you can’t pay cash for it. Use credit only if you plan on paying the entire balance due when your bill arrives. Credit cards can be a great deal for the consumer as long as they don’t incur finance charges. Use their money for free as long as you can. I have never paid a finance charge in my life. Don’t waste money on expensive cars and clothes. Cars are depreciating assets that should be considered reliable and safe transportation for you. You can dress very nicely without spending a lot of money. Max out your retirement contribution each year and take advantage of any “match” your company might offer you on your 401K plan at work. Start saving and investing money as soon as you can. It is more important to build wealth than to use your excess savings to pay down your mortgage. Mortgage interest is cheap and tax deductible. Liquidity is very important when buying a home and maintaining one.