According to a recent survey by the California Association of Realtors®, most millennials still believe in homeownership and the majority expects to be able to buy a home within the next five years. This was a survey of young adults aged between 18 and 34.
Apparently more than half of the millennials surveyed rated homeownership as being eight or higher on a scale of 1 to 10, with 10 being extremely important while one was least important. They see the biggest advantage of owning their own property as being able to do whatever they want with it, and having the privacy and satisfaction of owning their own home. In addition, they are also optimistic about the future home prices. Some 59% think home prices will increase during the next 12 months, and 63% think home prices will be higher in five years’ time.
The article in RisMedia points out that even though recent news reports have shown young adults having to move back home with their parents, this age group hasn’t completely written off buying their own home and still aspire to homeownership. This is in spite of the fact that many probably saw parents or friends struggle during the recent housing crisis. Even though this age group may have to delay their home purchase, they still expect to own their own home eventually.
Just over one third of those currently renting a property would be motivated to buy by affordable home prices. Some 16% would feel motivated to buy property if they had the down payment required to make the purchase, while another 15% would feel motivated if they saw their finances improve.
Most of the millennials renting a property are doing so because they currently can’t afford to purchase a home. Nearly half are concerned about home affordability and high property prices. Even though one in two has student debt, they don’t see it as an obstacle to prevent them qualifying for a mortgage and over 40% don’t have debt that will prevent them from purchasing a home. Even so, most of those surveyed were doubtful if they could qualify for a mortgage right now.
It’s easy to assume these young millennials will prefer to buy homes in urban areas, but the truth is that they would rather opt for a single family home on a large lot in the suburbs, and 67% plan to purchase a single-family detached home while just 12% are thinking of purchasing a condominium or townhome.