For the past decade, America has been dominated by the generation of Baby Boomers. But as their generation descends, the current generation of Millennials are claiming their spot as being the largest group of Americans currently. Millennials are defined as the generation born between the early 1980’s and early 2000’s. There are currently 4.7 million 23-year-olds; the second most populous group being 24 years old and then third is 22. What this is communicating to us is that Millennials are soon to be graduating college, landing their first job, and searching to buy a home. Here’s why they’re prepared:
1. They learned from the market crash
Millennial’s have witnessed first hand the tragedy of the market crashing and are now able to strategically plan differently. Kristen Robinson, Fidelity senior vice president of women and young investors, says in a money.us news article that Millennials have taken away valuable lessons from watching their parents struggle through the recession. Being apprehensive when it comes to taking on homeownership is common.
2. They are moving up and out
Being the largest generation in America right now, they are boosting the housing market by gaining responsibility and taking on a mortgage. Forbes claims, roughly 42% of them say they want to own a home within the next five years.
3. They are frugal with their cash
Millennials are a group that holds a lot of responsibility. According to money.usnews.com in a survey, Fidelity found that this group tends to worry a lot about their money, with 4 in 10 being uneasy about money at least once a week. What this means is money management comes as natural to them as a sixth sense.
4. Technologically more savvy than most
This generation is always on their phones. They have access to banking and budgeting apps that some older generations do not take advantage of. They can check their bank account with a few quick taps of their fingers and use apps like Venmo in order to make or receive payments. The current technology keeps them constantly up to date regarding their financial status, therefore aware of their spending habits.
5. They are aware that rent is sky high
Being new graduates from a college town, most of these people most likely rented from an apartment complex or homeowner for the past four years or more. Meanwhile, realtor.com claims rent is only going up and is rising 4% annually. Buying a home would stop them from shoveling their money into monthly rent and instead turning those payments into an investment.
Buying a home is an exciting life event! It can be complicated and stressful, however the Millennials are ready, emotionally and financially. Their knowledge and excitement makes them potential buyers knowing what is going on in the housing market. With so much information at their fingertips, they are educated. They do not think twice about working online to search for homes, pre-qualify requirements, or to fill out applications. Communication through technology is done without a second thought. In my opinion, this makes my job as a mortgage expert streamlined. Millennials are a great group to work with!