Is homeownership on the horizon for American millennials this year? MABA MassachsuettsRealEstate FirstTimeHomeBuyers MaBuyerAgent

More than three quarters of American millennials say owning a home is still a part of the American dream but according to a new survey from Clever Real Estate, forty eight percent say homeownership is not affordable for the average millennial. The real estate company surveyed 1,000 American adults who are looking to make a home purchase before the end of 2024 to gauge their homebuying attitudes and preferences.

Nearly all millennials ninety three percent say a volatile market is to blame for wrecking homebuying plans, with another seventy six percent saying they expect the market to get worse before they’re able to make a purchase themselves. Of those who do own a home, thirty three percent feel guilty for owning a property when so many of their peers are unable to afford to do so.

For millennials who still plan on making a purchase, forty two percent say they expect to make concessions on the characteristics of the home they purchase, while twenty nine percent say they’ll probably have to make financial concessions, like paying a higher interest rate, making multiple offers, maxing out their budget or paying over asking price. As a result, ninety six percent of millennials are concerned about making such a large purchase that doesn’t fit their ideal “dream home” image for one reason or another. Thirty-five percent worry that they’ll need to make major repairs, while twenty five percent worry they won’t be able to afford their mortgage payment.

Unsurprisingly, half of millennials say high interest rates have affected their homebuying plans, with sixty six percent saying current interest rates make it an overall bad time to buy a home. That said, 78% would consider accepting an interest rate higher than the national rate of about seven percent. An additional sixty five percent would accept an interest rate of ten percent or more, while twenty three percent would go as high as fifteen percent or more. For comparison, forty nine percent of baby boomers would only consider an interest rate of seven percent or less. However, about one in four millennials have less than $10,000 in savings, and one in eight have less than $1,000 in savings. An additional five percent have no savings at all.

It makes sense, then, that forty seven percent of homebuying millennials plan to put down less than twenty percent when they purchase a home. On the flip side, seventy nine percent said they would pay over asking price if it meant beating out the competition last year, that number was significantly higher at eighty five percent. Furthermore, one in nine millennials say they’d go as high as $100,000 over asking price to secure their dream home. All in all, millennials are feeling pretty desperate to find homes sixty seven percent shared that they’d be willing to buy a fixer-upper, and sixty seven percent say they’d even be willing to purchase a home with asbestos.

Another sixty two percent would buy a home with mold, while fifty eight percent would buy a home with foundation issues. Unfortunately, ninety percent of millennials who already own a home have some regrets about their purchase, with the most common regret being bad location (twenty seven percent), followed by bad neighbors (twenty six percent). Even so, millennials are way more likely than boomers to accept living near an airport, railroad track, busy highway or landfill.

With all this in mind, many millennials are adjusting their expectations when it comes to finding a home in 2024. Half say they plan on saving more money before purchasing, while 40% say they’re increasing their budget. One-third of millennials say they’re going to save a bigger down payment, buy a less expensive home, or put off their plans to buy a home for a while, while thirty two percent say they plan on shopping around for mortgages.

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