Milliannials' Obstacles to Purchase a Home
Here is a simple chart prepared by C.A.R. (California Association of Realtors) with data supplied by NAR.
As the chart shows there are quite a few reasons that Millennials do not run out and buy homes right out of school. Many have lived on credit cards and student loans during the college years and now they need to find a good paying job and pay down the credit cards and start paying off those nagging student loans.
Credit Scores can be a problem due to late payments or sometimes there is no credit at all if parents have supplemented the student loans and now the lending company says "You do not have any credit history so come back next year".
Right out of college and perhaps the first job is not the best paying as it takes a few years to get to a comfortable level of income.
Millennials are comfortable living in dorms or parent's homes so most do not want or cannot deal with a total fixer so they end up renting a nice apartment instead.
Saving the down payment is always a problem for ALL buyers these days. With debt and starting pay many times there is not a whole lot of $$ to save in the bank. The younger kids prefer to have a nice apartment, go out to eat frequently and put off buying for a few years. Oh yes and let's not forget buying a new car too as this is one of the first purchases a graduates makes after getting a paycheck.
Options: Many times parents will help kids to get into a house and then they are comfortable paying the monthly expenses and mortgage payment, taxes and insurance.
Other Options- Many "First Time Home Buyer" programs to assist with the closing costs and down payment but keep in mind the credit must be good here so no "late or missed" payments or even foreclosed cars.
PLAN- Get on a budget and start saving money. Talk with a Realtor and Lender and make a plan going forward to save for that new home.
Remember- Buying a home is the American Way!