Millennials have finally made their way into the housing market with very little hope for an easy transition into the status of homeowners. Inventory is lacking, sales prices are hitting record highs, and mortgage rates are rising. According to the National Association of Realtors, millennials—anyone born between 1980-1998 — make up 43% of current homebuyers. Let’s take a look at some of the challenges this generation might be facing in their pursuit of homeownership.
Inventory continues to decline as we journey through 2022 compared to last year. March active residential listings were down 21% year-over-year and down 59% compared to March 2020. Local industry experts don’t see an end to the inventory problem in sight. The only hope for a cool-down would be for interest rates to rise at a rapid pace, which could price some buyers out of the market. Time will only tell if that will help the inventory problem for eager millennial buyers.
What do you get when you combine baby boomers looking to downsize with millennials looking for starter homes? A competitive bidding war for the ages. The already lacking supply along with two generations looking for the same type of home makes for an even more competitive market. Baby boomers seem to be crushing most of the competition simply because of the wealth they have built in comparison to millennials who are just starting to get their footing on their finances.
Rising Home Prices
In March, homes in Hampton Roads hit a median sales price of $300,000 — a record high only matched by July of last year. That’s a 3% increase compared to February 2022 and a 9% increase compared to last year. With demand still being strong and inventory decreasing, buyers shouldn’t expect to see home prices take a sharp dip any time soon.
Looming Student Loans
Many millennials are walking into the homebuying process with student loan debt slung across their shoulders weighing them down. Some have accumulated so much debt that it could potentially kill their homebuying dreams. A high loan balance coupled with high monthly payments could hurt your chances of being approved for a mortgage. Understanding your loan options despite your student loan debt will be key in overcoming this particular hurdle.
Is this particular time in the housing market the worst-case scenario for millennials looking to buy? Maybe for some, but there just might be hope for this budding generation. Get an edge on the competition and keep a pulse on the market by using REIN.com. REIN.com is powered by REIN MLS, the Hampton Roads Multiple Listing Service, so you have access to the exact same information that real estate professionals use every day. Because REIN.com’s listing data comes from the local MLS, you’re getting the most accurate information from a reliable source. Here are some additional benefits of using REIN.com in your home search.
- View the freshest listings as soon as they hit the market by searching for properties listed within 24 hours.
- Take a virtual tour.
- Browse open houses.
- Prioritize your search results so you see the best possible matches first.
- Fine-tune your search by eliminating listings that don’t meet your wants and needs.
- Track home price increases and decreases.
- Take REIN.com with you wherever you go with the REIN.com mobile app, and gain access to augmented reality search capabilities, calculated commute time from work or school, and in-app chat ability.
If you’re a first-time buyer looking to get into the market, check out our first-time homebuyer checklist to help you plan. Connect with one of 8,000 agents today to help you successfully navigate the market. To find out what you can afford, check out our mortgage calculator to help estimate your monthly payments. Download the REIN.com app and put the power of fresh and accurate listing data in the palm of your hand. Available in the App Store and Google Play Store. For local listings you can trust, start with REIN.com.
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