If splurging on a daily iced coffee isn’t your budget, the days of homeownership probably feel lightyears away. Besides mortgage payments, homeowners must cover home maintenance costs, invest in homeowners insurance, and spend thousands furnishing their new living spaces. This is one of the many reasons why millennials aren’t buying houses.
Approaching the homeownership milestone is exciting, but you may be wondering how it’s humanly possible to reach it. Is it possible to buy property when you’re flailing in student debt and clipping coupons to cover weekly runs to the grocery store?
Unfortunately, the harsh reality is that millennials are struggling more than prior generations to buy their own homes. Here’s a list of just a few reasons millennials aren’t buying houses in this day and age:
Affordability of a Mortgage
Housing prices have risen to the point that millennials must violate their budget boundaries to make monthly mortgage payments. That said, many 20 and 30-somethings are forgoing homeownership altogether.
As a millennial, it would be safe to guess you might be overwhelmed by debt. Between student loans and credit card debt, it’s understandable that buying a home seems impossible.
Student debt payments make additional payments overwhelming or even unmanageable. If you are struggling to pay off your loans, read our article Is It Worth It To Refinance A Student Loan? to find a way to help.
If you want to be happy in the long run, you can start today by making lifestyle choices that’ll enable you to pay off your debt faster, bringing the potential of a home closer to reality.
Living by a budget
Despite the importance of budgeting, many aspiring millennial homeowners still don’t know how to draft a budget. Not surprisingly, most financially successful people swear by keeping a personal budget.
The most basic principle of budgeting is to put everything down on paper. Once you see the truth about your financial situation, you will see straightforward ways to cut spending and increase your savings.
Learn more about the basics of budgeting with our article Why You Need To Create A Money Saving Chart Now.
Because many people still wait for marriage to buy their first homes, those millennials delaying their nuptials typically opt to rent rather than buy.
Many millennials primarily focus on their careers, making home lives a secondary consideration.
The good news is millennials are not doomed to live in their parents’ basements or rented apartments for the rest of their lives. As you climb the career ladder, you’ll earn more income and reach a place where you’ll be comfortable making the investment of buying a house.
Tiny house Trend
Tiny houses are a growing trend, especially with millennials. For many, owning a 2,000 square foot home isn’t possible. Not only do tiny houses save you money, but there are also several other benefits. Including:
- Lower costs for property taxes and insurance
- Tremendous savings on energy costs
- Living a simple life not tied to possessions.
- Lower rent and mortgage costs
- Increased ability to travel
You might want to shop for small house plans and ditch your dreams of three bathrooms and multiple walk-in closets (for now).
Relying On Multiple sources of income
The idea of working a second job is never pleasant, as they often interfere with relationships and other activities. If you work two jobs, managing a house can sound completely overwhelming.
If you can find work related to a hobby or focused on personal growth, you might get more out of a second job than you expected. That way, your second shift won’t inflict undue stress.
However, it’s undeniable that many millennials spend far more time working than did previous generations. Thinking about keeping up with a house on top of it is not appealing.
Don’t give up on your dream of homeownership. You’ll get your chance when the time (and your financial situation) is right!