Millennials’ homebuying process has gradually changed from when to how.
With limited inventory and higher prices, along with student loan debt, many millennials are struggling to find their place in the homebuying market. Millennials are primarily motivated because they think it’s a good investment (46%), their desire to raise a family (37%) and believing they have enough money saved (37%), according to Clever Real Estate. Low interest rates (33%) and keeping up with friends buying homes (27%) are other motivators. Most millennials understand the market may be difficult at this time and they are pivoting to try and find a home. Forty-seven percent expanded their search location, 46% increased their budget and 45% made sacrifices to afford homeownership.
Most millennials are willing to go well above the listing price for a home, too. Eighty percent said they would offer at least $1 over asking, while 17% said they offer $100,000 or more over asking for their dream home. Additionally, the majority of millennials are willing to take a risk. Nine out of 10 millennials said they would buy a house without seeing it in person. Fifty-six percent said it would have to be the right price, another 56% said if the home was brand new with no prior owners, 49% said if the seller offered to pay fees associated with the sale and 48% said if there was a bidding war. Most buyers would want a live virtual tour (70%), photos (63%) or someone else to go look at the house first (59%) before putting in their offer.
However, 82% of current homeowners who bought a fixer-upper said they have at least one regret about their home. Foundation issues (53%), a bad neighborhood (53%), a leaky roof (50%), termites (48%) and/or pests such as cockroaches, mice, and spiders (47%) is what homebuyers regretted about their fixer upper. About 31% of millennials plan to stay in their next home for less than five years, while 20% plan to remain there for 20 years or more.
Ultimately, millennials confessed their biggest fears about buying a home include major repairs (54%), hidden costs of homeownership (51%), home value decreasing (49%), a potential housing market crash (43%) and not finding an affordable home (43%).