In many real estate markets, spring is a hot season for open houses, and as their families grow, many millennials may be looking to buy homes. Help readers get a pulse on current market conditions by looking at these trends.
The impact of rising interest rates
Despite high student loan burdens and other financial challenges, home buyers 37 years and younger (millennials/Gen Yers) were the largest share of the market in the National Association of REALTORS’ 2018 Home Buyer and Seller Generational Trends Report. However, real estate experts predict that rising mortgage rates could distance millennials from home ownership. Is that happening in your neck of the woods? Perhaps talk to mortgage brokers and real estate agents to get a feel for the local market or attend open houses to connect with prospective buyers in your area.
Buying in urban areas
According to Harvard researcher Hyoung Lee, millennials are bucking the typical narrative of the American family that moves out of the city as the family grows so the kids can have a backyard and a suburban education. Lee predicts population growth in cities over the next two decades as millennials choose to live with their families in city centers over suburbs. Is that playing out in your community? If so, how? What does that mean for local service providers and other businesses?
Some Millennials buying second homes first
Of course, not all 20 or 30-somethings can afford to buy in pricey urban areas, so the American Apartment Owners Association reports that some millennials are renting in cities but buying a country house. Often, the purchase is intended as a wealth-building strategy because the owners can rent out the property when they’re not using it. Still, many places are cracking down on short-term vacation rentals, so it’s worth mentioning this wrinkle to would-be buyers.
Real estate professors. ExpertiseFinder lists 49 professors with expertise in virtually all aspects of real estate, including real estate law, real estate finance and real estate investment trusts (REITs).
National Association of REALTORS (NAR). NAR’s media room has lots of information on real estate trends and data. Keep in mind that not all real estate agents are NAR members, so avoid using the term realtor generically.
Financial planners. XY Planning Network includes financial advisors who specialize in serving Gen X and Gen Y, while Garrett Planning Network offers a more general directory of financial advisors that’s searchable by geography. A financial advisor in your area could likely discuss the financial considerations of buying a home, whether it’s a primary residence or a vacation rental.