Oh, Very Young
Homeownership is fast becoming a trendy but wise decision for 20-something buyers
While some only dream of buying a home, more than 75 million people have done so. According to the U.S. Census Bureau, homeowner- ship is up nationwide to 69 percent.
BY LISA SCONTRAS
Renters come up with all kinds of reasons why they can’t buy a home credit problems, a stack of bills to pay, no savings all of which can be intimidating.
But today, young buyers are emerging on the homebuying scene in growing numbers, armed with raw determination and a realistic approach.
According to Mary Edu, Realtor at Prudential Locations, there are two main qualities that separate 20something buyers from terminal renters. They understand the value of real estate as a long-term investment and they don’t mind starting small.
“The younger buyer doesn’t mind starting out in a condo,” says Edu. “They know it’s just their first step into homeownership. They are open-minded and very easy to work with. And they are willing to stay with what they can afford.”
Edu, whose youngest client a single woman just purchased her first townhome at age 23, estimates that those between the ages of 27 and 32 now make up the largest group of first-time homebuyers.
A National Association of Realtors study confirms this trend. The survey recently found that the percentage of first-time homebuyers under age 25 has been increasing a trend it attributes to the continuing response to historically low-interest rates and confidence in the long-term housing market.
Edu states that one of the greatest motivators of this generation is a sense of independence, along with a tremendous sense of pride that comes with owning real estate.
“Then there are the people who just think homeownership is impossible for them,” says Edu, who recalls one couple who felt that way recently and just needed a little encouragement and direction.
“This couple was saving money to buy a new car,” says Edu. “Purchasing a home never occurred to them because others told them that in their position, homeownership was impossible. The next best thing was a brand new car, so that was their goal until they met me.”
Fast-forward a few months and the couple chose to pass on the car and purchase their first home instead.
“They had a decent income, but had little or no credit established as they had not been in the United States very long,” Edu explains. “Meanwhile, others in similar situations continue to rent.”
Her advice for buyers of any age who may be holding back is simple:
“Young or old, if you are in a position to buy, consider your options. With fabulous interest rates and potential tax savings that comes with homeownership, it’s a perfect opportunity to own versus rent,” she says. “Why deal with continuous rent increases, no tax shelter, no home to actually call your own and the possibility that ‘your place’ will go up for sale at anytime, living in a home with someone else’s rules?”
Homeownership has become trendy for this age group. She says once one young person buys a home, “then all their friends want to be homeowners, too.”
“Younger generations are now thinking more ahead about investing and owning real estate,” she says. “Makes them consider spending their hard-earned money more wisely.”