Millennials who bought a home are generally happy about it. Bank of America’s second annual Homebuyer Insights Report finds that millennials who have taken the plunge into homeownership buy the house they can afford now and plan to buy their ideal home later. A large majority (68 percent) of millennial homeowners say their current home is a “stepping stone” to their forever home.
Some recent reports have said millennials aren’t buying starter homes; instead, they’re saving downpayment money for their dream home. But that doesn’t appear true in Bank of America’s latest report.
“After years of seeing millennials sit on the sidelines, it’s clear some are recognizing it might not make sense to wait,” says D. Steve Boland, consumer lending executive for Bank of America. “We talk to younger buyers every day about homeownership, and they understand the benefits it can have on their long-term finances. They’re excited to get started but are taking a thoughtful approach by improving their credit and building their savings.”
Millennial homeowners are confident they made the right decision in buying. Nearly 80 percent report homeownership has had a positive impact on their long-term financial picture and 86 percent) believe ownership is more affordable than renting.
The young owners’ attitudes differ from young renters who have not yet purchased a home. They’re split on what’s more affordable: 54 percent say owning and 45 percent say renting.
In further defining homeownership, 18- to 34-year-old owners are more likely than any other generation to associate it with adulthood (39 percent) and least likely to define it as the American dream (16 percent) and permanence (11 percent).
Advice for younger renters today? When looking back at their buying experience, current owners across generations would tell their younger selves to start saving sooner (60 percent), consider the maintenance costs and unexpected expenses (42 percent), and create (and stick to) a budget (35 percent); 21 percent say buy early to build equity.
Just one-third of owners say a home’s value is determined by how much it cost to purchase. Beyond financial value, current homeowners also see clear emotional benefits of homeownership. Nearly all say they’re proud of owning (95 percent) and treasure the memories they have made (91 percent). But 21 percent say owning a home is a burden.
Furthermore, 82 percent of experienced buyers look for ways to make their current home more valuable, and 70 percent spend a lot of free time working on their home.
© 2017 Florida Realtors