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Of course if you focus on the big coastal cities the premise registers as true. Here in Indy? All four of our millennial kids bought homes before they turned 30. 3 of 4 were still single. And we didn’t give them down payments.
The trouble with articles like this is that sometimes they are misleading as there are so many factors impacting consumers. One of the main factors is desire. By that I am implying that one must be willing to sacrifice a little. I am convinced that where there’s a will, there will almost always be a way. Many people prefer renting and see ownership as a hassle. Others cannot save money as they lack discipline. A lot of folks in this age group are waiting for rates to come down, which is unrealisitic. My wife and I scraped, saved, worked two jobs, etc, and were able to buy our first home back in 1985. A very small 3 BR, 1 BA home that was close in price to what we were paying in rent and the interest rate was 13.5%as we assumed the loan of the seller! We were happy as the mortgage rates at the time were in the 16% range. We could not buy a fancy home at that time but we made do with what we could afford. Our incomes gradually went up and we built equity and traded up over the years, and it all worked out. Many younger folks do this, yet many others blame high prices, inflation, lack of inventory, rates, etc. If I lived in an area where I had to spend $600-800K in order to buy, I would seriously look for better (more affordable) areas to buy in and make a move.
Amen. The current whining about “high” 6% interest rates is hilarious. Rates have been over 6% for most of my 40+ year adult life; the “nearly free” money of 2011-2020 was the outlier. (We bought the first house about the same time as Joe with a 12.5% FHA mortgage, and the first time I had a rate lower than 6% was 25+ years later.)
First time buyers are only priced out if the only thing they’ll consider is a newly-built 2000sf suburban house. If they’re willing to buy a less-than-perfect 20-40 year old home, or (heaven forbid) a 2/1 “cottage” under 1000sf, then the challenge of home buying doesn’t seem as daunting.
Hey, it is hard to save money when you are doing Starbucks (more than once per day), buying the latest gadgets [iPhones, anyone] dining out a lot – and when you’re not, you order from Door Dash or another take-out service… Joe F’s comment is spot on when he says, “Others cannot save money as they lack discipline”. The only think I would change is the word “cannot” to “DO NOT”.
And for some, the idea of buying a very modest starter home [a small(er) home in a less prestigious neighborhood, or without a lot of high end features, or one that needs some work to fix up] is apparently beneath them. Our first two homes needed work – a lot of it – that is how we generated the “sweat equity” to buy our next (decent, but still not luxurious) house.
Everything you described would be $400/month.
That’s meaningless when a small starter fix up 2/1 in the bad side of Irvington is $300k.
I also don’t know any millennials who go to Starbucks lol
Frankie, you’re mistaken. 2/1 moderate fixers in less than perfect neighborhoods are closer to $200K than 300, which is about $1800/month PITI with a low-down FHA loan ($10K down).
40ish years ago, we had a $550 house payment for an older 2/1 with the original kitchen and bath in a fringey area on a combined income of $30K. And some student loans too, even then.
Adjusted for inflation that would be a house payment of $1700 today on a $93K combined income. It’s doable but you do have to be careful.
Frankie I don’t know what Irvington you’re talking about but it’s definitely not Irvington Indiana because prices are nowhere near that expensive for a two bedroom one bath fixer upper.
25 n Sheridan is 3/2 fir 240K, 1439 n emerson. 2/1.5. For 200k, 48 n Bolton 3/1 210k. There are multiple other houses listed that are completely renovated for less than $300,000.
It’s not the high cost of living that’s the impediment. It’s the cost of living high.