Despite an overwhelming percentage of millennials wanting to own homes, nearly half of the demographic cohort don’t think that homeownership is affordable for the average millennial.
That’s according to the Real Estate Witch 2024 Millennial Home Buyer Survey, performed in October last year by Real Estate Witch and Clever. The study found that 78% of millennials still say that a home purchase is part of the American dream, but the difficult buying environment has impacted would-be millennial buyers practically and psychologically.
Ninety-three percent of millennials in Clever’s study said that the market has impacted their homebuying plans, while 76% are concerned that it will get worse before they buy a home. Many have acknowledged that compromises will have to be made once they are able to buy, with Clever’s survey finding that 42% of millennials expect to make concessions on the characteristics of a home and 29% expect to make financial concessions.
Additionally, 30% of millennials anticipate maxing out their budget, and 29% expect to pay more than a home’s asking price. Twenty-nine percent foresee having to take part in a bidding war, while 28% are preparing to have at least one offer rejected. Sixty-seven percent of millennials would be willing to buy a fixer-upper, although 18% who did said that they regret doing so. Some potential millennial buyers would be willing to bite the bullet on some extreme problems: 67% said they’d buy a home containing asbestos, 62% would buy a home with mold and 58% would purchase a property with foundation issues.
Prospective millennial buyers are also cognizant of the harsh interest rate climate, with 50% of millennials saying high interest rates are a barrier to homeownership and a whopping 96% indicating that high interest rates have affected their homebuying plans. Thirty-nine percent expect to pay a higher interest rate than they would like, and 67% regret not buying a home when interest rates were lower. However, millennials are so determined to buy that 78% — more than three in four — would consider accepting an interest rate that’s higher than the national average. In fact, 65% would accept an interest rate of at least 10%, while 23% would accept an interest rate of 15% or higher.
