Jasmine Davis is a millennial homeowner who is lovingly restoring her fixer-upper in Pittsburgh, one statement wall at a time.
You may have internalized the story that “millennials don’t buy homes,” but it couldn’t be further from the truth. In fact, more millennials are buying homes than ever: 36% of home buyers were millennials in 2017. So what’s stopped you from buying? Here are some common objections to taking the plunge:
“I think buying a home is too expensive.”
Yes, buying a house is likely one of the largest purchases you’ll ever make in your life (unless you’re one of these guys, in which case, can I go on your private jet?). The price tag of your new home may take your breath away, but breaking that number down into a monthly mortgage can make it seem downright reasonable (here’s a calculator!).
Instead of blindly shopping, start your home search by looking at how much mortgage you might be able to get. Then, break it down into what your monthly payment might look like. Many homeowners find that, all things considered, buying actually is a viable alternative to renting. Here’s what you should keep in mind when you’re considering making the switch from renting to owning a home.
“I’m drowning in student loan debt.”
You may be thinking, “How can I even consider buying a house with all this student loan debt over my head?” After all, there are new news stories every day about the student loan debt crisis: student loan borrowers under age 40 owe a combined $844.8 billion.
But your own personal mountain of student loan debt may not actually be a barrier to owning a home. In fact, having a college degree is one of the strongest indicators that you will be a homeowner – 67% of people with college degrees are homeowners. Studies indicate that student loan debts really only factor into homeownership rates when you look at those who owe more than $50,000 or are making payments that total more than 5% of their income.
If you’re worried that your student loans might get in your way, you can look at getting pre-approved for a mortgage. That way, you’ll know exactly how much you can spend on a home before you even start looking.
“But what if I lose my job?”
You’ve heard all over the news, “Millennials only have jobs for two years!” The reality is, we’re a group that’s not going to settle – most job changes that our age group undergoes are by choice. In fact, nearly one in four people quit a job in 2017!
As long as you’re not planning to quit your job tomorrow, you may still be able to buy a home. In order to get a mortgage, you do need stable employment, but afterward, you are able to change jobs without having it impact your mortgage.
“I don’t have enough saved up for a house!”
Think you don’t have enough saved to buy a house? Think again! While yes, a 10 – 20% down payment is common, it’s far from the only option. Many lenders are willing to accept a lower down payment, and some states, including Ohio and Pennsylvania, assist first-time homebuyers with down payments and closing costs. You may pay a little more on your monthly payments in exchange for owning a home sooner, but you’ll also be in your dream space that much sooner.
Our “My First Home” program can also help new homebuyers finance many of the closing costs associated with a home – which can help you stretch your savings even further.
“What happens if my tastes change?”
Terrified of buying a house and realizing, 2-3 years from now, that it’s not all that it’s cracked up to be? It’s a common worry, more so among millennials than other age groups.
The reality is, trading up and selling your home to purchase a new one is really common. Maybe your “starter home” just isn’t right for you in a few years, and that’s okay. Programs like Buy Before You Sell let you buy a new home – one that’s closer to ~the dream~ – without worrying about paying two mortgages. (But while we’re here, maybe give our Homes of Distinction a browse – can you say “private lakeside cabana”?)
Our lives may not always be Insta-ready, but with a space of your own, you can start building out your own little slice of paradise. Ready to take that next step? Here are the five things you absolutely have to know as a first time homebuyer. Then, figure out how much home you may be able to afford.