Millennials wanting to buy homes in the U.S. will find it the process of owning properties to be a difficult path, as they face tough competition from experienced buyers.
Data from software company Ellie Mae showed that mortgage loans from the millennial generation accounted for the biggest group of home buyers in January. Their share of purchase loans in the month rose to 45% from 42% year over year.
The influx of young house hunters will definitely make it hard for them to close deals, as they compete with repeat buyers.
Most of the millennial buyers are looking to buy homes for the first time, and that places them at a disadvantage when going against others with more experience and funding leverage. Higher home prices due to a ballooning demand will also make it harder for younger home buyers to find properties that match their available funding resources.
While millennial buyers may find that their budget will only align with prices for starter homes, some states such as Utah are resolving the issue by advancing affordable housing.
As mortgage rates in Utah are expected to increase further, the state legislature has supported HB36 to provide incentives to property developers and landlords. It aims to use loans and better tax credits to encourage them to lower rates on rentals and leasing for tenants.
The bill will complement the state’s efforts for creating more affordable homes to address homelessness. Some experts, however, believe that the construction of new homes serves as a bigger solution to the problem.
It’s not only millennials that face challenges in buying homes, as many people also find it hard to own properties due to high prices. Fortunately, there are financing options that you may consider to help in making your path to homeownership to be less difficult.