Am I too young to buy a home? This is a common question Millennials are asking themselves in this sellers’ market. Fairway Mortgage recently sat down with two young home buyers aged 23 and 26 to hear their story on why they are glad they bought as Millennials.
4 Tips from Millennials on the Advantages of Buying While Young
Fairway: What concerns did you have when you started looking at buying a home?
Millennial Home Buyers: We initially thought we’d wait until after we got married to buy a home since we didn’t want to stress ourselves before the wedding. We started looking around at homes in October 2016 thinking we’d hit the house research hard after our wedding in July 2017. We also thought we’d use gift funds from our wedding to help cover our down payment since we assumed it would be costly. We were also concerned with the fact that we just signed a new year long lease in September 2016 so we didn’t want to break the lease so early on since it would also be costly.
Fairway: What qualifications did you initially think were necessary when buying your home?
Millennial Home Buyers:: Our families live in the South Sound near Tacoma, so we pictured ourselves living near that area. We also talked a lot about buying a fixer upper type of home so we could gain equity after putting work into the home. Style wasn’t necessarily important to use, since we pictured ourselves renovating anyway. We wanted a house with at least a small yard since we have a dog who likes to play outside. Other than that, our biggest qualification was that we needed to buy a home we could gain equity off of so we would have a great start in the next home we buy.
Fairway: What pushed you over the edge to consider buying before your planned wedding day?
Millennial Home Buyers: We were driving out and about one day when we stopped into a model home of a new community of new construction homes. Intrigued, since we never thought about buying a brand new home, we stopped in to talk to the sales agent. He went on to talk about the benefits of buying a new home, and how the home wouldn’t be ready to move into until 6 months from that day.
This waiting period was perfect for our lease situation. He also talked about how we would be able to choose our own countertops, carpets, and backsplashes. This wasn’t necessary for us, but it was a cool addition. Additionally, he mentioned that the builder worked with preferred lenders who could provide options about different loan types and could give advice on paying a lower down payment.
Finally, he mentioned that the same home in the next phase would be $35,000 more as a base price. This was due to rising costs of land and parts as well as the rising popularity of this community. So essentially, we would gain equity in the home before we even moved in. Suddenly, there were no more large objections to buying right away.
Fairway: What advice do you have for young couples who are looking to buy a home in this market?
Millennial Home Buyers: If you can swing it, Millennials, we advise that you strongly consider buying now while you are able to quickly gain equity off of your home in a way that you can’t do if you’re just renting a property.
Make a list of your largest objections and talk to real estate professionals as well as mortgage lenders about your concerns. You may be surprised at the low down payment and mortgage insurance programs they have for young home buyers. Building relationships with housing professionals will help you confidently choose what home to buy.
Prioritize what’s important to you and your family, because sometimes you will need to sacrifice a couple of your seemingly important items. Even if it means buying a little earlier than you expect, with strong relationships with your real estate agent and mortgage lender, you will be happy and confident in your choice to buy in this hot market. We sure are happy we did!