What You Want To Know If You’re Pursuing Your Dream of Homeownership
If you're a young adult, you may be considering your goals and priorities for the coming months and years. And if home ownership is high on your priority list, you're not alone. Many of your classmates are also pursuing their dream of home ownership. According to Maxwell's 2022 Millennial & Gen Z Borrower Sentiment Report:
“Many young adults have demonstrated their resolve to embark on the journey toward homeownership soon. More than half of millennials and Gen Zs plan to apply for a mortgage sometime within the next year.”
Let's look at why homeownership is at the top of so many young buyers' to-do lists, and what you should think about if you're one of them.
Top Motivators To Buy a Home
Before you begin the home-buying process, you should consider why homeownership is so important to you. The aforementioned survey sheds light on some of the primary reasons why younger generations want to buy a home. It discovers:
95% believe the cost of renting is too high
35% think owning a home is an important wealth-building tool
16% seek the sense of security that owning a home provides
37% plan to use it as an investment property
No matter which of these resonates the most with you, know there are many financial and non-financial reasons why you may want to buy a home. While your top motivator may be different than that of your friends, they’re all equally valid and worthwhile.
Key Obstacles and How To Overcome Them
It can be difficult to know where to begin when looking to buy a home, whether your goals are driven by the heart or by financial aspirations (or both). It's a lot to take in, from understanding the home buying process to getting pre-approved and researching down payment options.
The same Maxwell survey identifies key challenges for prospective buyers. Fortunately, the knowledge and guidance of a reputable real estate professional can assist you in overcoming both. Here are two of the obstacles that prospective homebuyers say they face:
1. The Mortgage Process Can Be Intimidating
In the Maxwell study, 33.37% said one of their obstacles was that the mortgage process is confusing or difficult to understand.
An article by OwnUp helps explain why the mortgage process is so challenging for buyers:
“There is a general lack of knowledge about home financing. Mortgages are a complicated topic with no one-size-fits-all answer. It’s difficult to understand the space, let alone determine what the right course of action is based on your unique financial picture.”
While you may be tempted to conduct a quick online search to find instant answers to your questions, this may not provide you with the information you require to understand the entire picture. You want to rely on a true expert, especially when it comes to financial advice. Having trusted professionals on your side can help you learn what it takes to realize your homeownership dream. Not to mention, an expert can give you advice tailored to your specific situation, as opposed
2. It’s Hard To Know How Much You Need To Save
In the Maxwell study, 45.75% believe they don’t have enough saved to cover their down payment or closing cost expenses.
What you may not realize is that, today, there’s a growing number of down payment assistance programs available nationwide to help relieve this pressure. A report from Down Payment Resource says:
“Our Q3 2022 HPI report revealed a 1.6% uptick in the number of homebuyer assistance programs available to help people finance homes, raising the number of programs to 2,309, a net increase of 36 over the previous quarter.”
Furthermore, as the housing market cools, buyers regain some bargaining power, and more sellers are willing to work with buyers to cover closing costs. Understanding what's out there and your options may enable you to realize your dream of homeownership sooner than you thought possible.
If you're serious about becoming a homeowner, you should know that it may be closer than you think. Trusted professionals can assist you in overcoming obstacles and prioritizing your next steps.
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