Tina McManus' Blog
Some of the reasons why the young ones are not buying a home are the high student debt, affordability among others. We are going to discuss the primary reasons why young people are not buying a house in this article. Here we go:
One of the main reasons why millennials are not into real estate investment is a substantial financial implication. The home affordability for first-time buyers decreased to about 92.5 in 2018 according to NAR – National Association of Realtors. The index was 109.3 in the year 2015. A value of 100 shows that a family has what it takes to qualify for a median-priced home.
High level of student debt
Another reason why many young people could not afford a home is the high level of student debt. In the United States, student debt reached $1.5 trillion, and it is one of the factors that are hindering young people from investing in real estate. Apart from high student debt, they also have to deal with meager wages. The NAR report explained that more than half of the homebuyers who are below the age of thirty-eight that student debt is one of the significant factors that delayed their home buying. Apartment list shows that graduate that does not incur student debt will save for 7.6 years at 20% down payment to get home while those with debt will have to save money for more than 11.6 years.
If you are wondering why young people cannot afford a home, one of the reasons is stricter lending conditions. Financial institutions have tightened credit underwriting to minimize risk. The rise of house prices does not favor the young ones who are planning to buy a home. They will have to accumulate enough cash over a long period to enable them to afford a house. The Bank of America noted that those within the age of 25 to 35 years commenced their career at the time of financial crises when the labor market and economy were recovering.
Not Married Yet
The delay before getting married and having children means that young people are not considering getting a home sooner. The CDC (Center for Disease Control) reports that the mean age of a first-time mother is now 26.6. They discovered these findings in 2016; they added that the average age might increase when we consider the women in urban areas as well as college-educated women. According to the Census Bureau, getting married and having children are life events that trigger buying a home.
As a young person looking to buy a home, you should speak to a financial advisor and a reputable real estate agent to plan towards owning your own home.
When considering becoming a homeowner, one of the decisions you can make that will be beneficial to you is to deposit a down payment. However, the question is how do save up that hefty down payment?
One of the biggest roadblocks for prospective home buyers is securing a down payment. Fortunately, though, technology seems to be playing a huge factor in shrinking the burden of down payment. The whole saving process has become quite a bit less rigorous.
Below is a list of how you can overcome the down payment hurdle and ensure you have enough money when it’s time for you to buy.
Save A Fixed Amount Every Month
Saving a fixed amount is the simplest and most convenient way to save money. Open a savings account and discipline yourself to pay in a certain sum into the account every month. Discipline yourself not to use the money for any other purpose aside for your down payment.
Save a lot more than you spend, review your expenses and cut down on items that are not necessary. Whatever money generated as a result of this should be added to your down payment account.
Skip Vacations for A Year
I know going for a vacation during the year is something you are looking forward to and you have it all planned out. However, if you are looking to save up enough money for your down payment, then you should consider scrapping out vacation until you have enough money for your down payment.
Reduce Your Debt
Having a credit card with a high interest rate can limit your ability to save. Pay off your interest debt starting with the highest; after that, you can close off that card while you proceed to pay off the next.
Borrow from Your Retirement Plan
You can ask human resources or your payroll officer if it’s possible to borrow against your savings to buy a home. Many profit sharing setups make provisions for employees to loan a certain amount from their retirement plan to become a homeowner.
Borrow from A Relative
When it comes to getting a home of your own, most family members and relatives would be willing to help; they can grant you loans without interest, gifts and other non-monetary items that will help you in your down payment quest.
Get Another Source of Income
Getting a second job would mean you would probably be working round the clock, but in the long run, it would pay off. Getting another job means another source of income and more money to save into your down payment accounting.
So you've found the perfect home to move to, whether it is your first home up- or downsizing, congratulations. Now it is time to pack up. The rest is exciting, but now you dread the headache of packing, knowing how much supplies that you need to get (without a million trips to the store) and making sure that your fragile items make it to the new place intact.
How many supplies you need depends on what you have
The pros have enough experience to help with estimating how much supplies you should get based on the size and the description of your home and possessions. To get a picture of what is needed, a rule of thumb to measure by is per 1200 square feet of living space. Some suggestions are one 25-lb roll of packing paper, six rolls of tape, one roll of small bubble wrap (more if you have a bursting kitchen or many trinkets), mattress covers for all your mattresses and box springs (make sure they are the right size) and 80-100 furniture blankets.
Getting and keeping your boxes sealed
Depending on the scope of the move (length, time, movers or friends, etc.) you may be used to folding the flaps of your boxes closed, but this leaves them vulnerable to moisture, insects and other stuff getting into your boxes. Not to mention that it makes it much more likely that something will fall through (cue driveway full of what was once packed nicely into the box now empty in your hands). The easiest way to ensure that nothing goes in or out of your boxes once packed place three strips of tape across the top and bottom of all of your boxes. Types and number of boxes can be determined by asking your movers or putting it into a moving supplies calculator online.
Packing paper helps protect breakable items by preventing friction between objects. It does not leave ink residue that you have to try to remove after unpacking everything. It also helps to cover knives and other such items to help keep injuries from happening while unpacking. Bubble wrap is for the more fragile items in your house. Small bubbles for smaller things and large bubbles for things like large art and such.
Mattresses and box springs need care too
Mattress covers are essential for protecting the place where you spend one-third of your life and ensuring that no stains, dust or rips affect your investment. If you have a king size bed, remember that the box spring is usually two extra-long twin size so remember to get covers accordingly.
Don't forget to protect your furniture during the move. Scratches, dings, and dents, or broken drawers and doors, especially on expensive or heirloom furniture, could put a damper on any move. If that many blankets are too many for your budget, get enough for your most important furniture and then get paper moving pads or shrink wrap for the rest.
Avoiding the headache that can accompany moving
Although moving can be stressful, there is no reason to make it any more so than necessary. Do some research or ask a professional near you to take the stress, and trips to the store, out of moving this time around and enjoy your new home.
People downsize their living-space for all kinds of reasons. Making the decision to downsize shouldn't be a negative experience and shouldn't feel like your downgrading your home. Follow these tips to level up your lifestyle and home enjoyment while downsizing your accommodations.
Find a space that works for you.
You might be moving from a large home with a big kitchen or dining area to a more compact condo or cottage and feel like you're losing a lot of space. Think about how your current home is laid out and what parts you utilize the most. If you love your big kitchen, then search for a highly functional, if smaller, kitchen space. Pay attention to how you move through your kitchen now, is it fluid to go between different cooking, prep and cleaning areas? You might find that in reality, you run around your kitchen and loose efficiency. Look for a more compact, but well-appointed kitchen in your new home search and find an even better space for the cooking and entertaining you love.
Modernize your home view.
Your current home may have significant square footage, but how is it laid out? Are there lots of walls and hallways separating your rooms? What height are your ceilings? Does your house have a plethora of windows? Many modern homes have great open layouts. Shared space—a kitchen that opens to your living room, for example—makes both areas feel more substantial. Consider a condo or loft that has extra high ceilings and employ vertical storage to give height and openness to your living space. Finally, windows, windows, windows. Look for a home with large windows, and lots of them. Opening your house up to the beautiful outdoors and letting in lots of natural light gives your home the most added feeling of enlarged space.
Make your new rooms work double for you.
- Invest in a home with open kitchen, living, and dining spaces so you can entertain and remain a part of the activity while creating a meal or prepping drinks.
- Combine your office, guest and craft rooms into one multi-functional space. Use modern storage and office systems to keep your room organized and ready to use for any purpose. Find a great sofa bed for seating and guest use or go old-school with a built-in Murphy bed with added shelving on the exterior.
- Use combination appliances like a stacking washer and dryer or upgrade to front loading systems that you can put under the countertop or build a worktable over.
- Look for outdoor space that maximizes your interior space. French doors or a big sliding door that opens your living or dining room up to your patio expands your useable entertaining space. Find a home with a balcony off the master bedroom and extend your feeling of outdoor space.
Amenities. Amenities. Amenities.
In your home search consider narrowing in on communities with amenities that improve your lifestyle. Community gyms, pools, clubhouses, dog parks, and even a golf course are great opportunities to add to your lifestyle and help you make new connections. Properties with large green areas, barbecue pits, and trees make you feel like the whole community is your backyard. Associations that take care of maintaining your yard or washing windows can reduce the time you spend on home upkeep and free you up to live your life.
No matter the reason for your downsize take the smart steps to make it work for you and help you upgrade your living. Before you start your home search consult with your real estate professional about the best way to find the right space for you.