By Nia Saunders
It’s no secret that the millennials are a generation of careful spenders. Their unique upbringing and several cultural events are responsible for their spending habits, to read more about this refer to our other article How Millennials Could Affect the Economy.
The concept of investing can often be confusing and sound too risky, so millennials steer clear of taking out loans for large purchases. However, investing in large purchases like real estate is just as beneficial as saving your money. Because this generation is getting married and having kids much later than their parents and grandparents, buying a home is usually not at the top of their to-do list. The burden of student debt has also contributed to the weariness of homeownership among this generation.
Looking at a house through the lens of an investment property rather than a home, is one way to encourage millennials to invest in homeownership. Investing your money into a house can make a significant profit in the long run. It will also improve your credit score and develop credibility with the bank. Many millennials are choosing the option to rent rather than purchase to avoid taking out a loan for a mortgage. But taking a loan out to pay off a mortgage can actually help you more in the long run. Paying off a mortgage may seem like a daunting task, but these payments will add to your assets, instead of your landlord’s through a rental property. While paying monthly rent to a landlord may help increase your credit score, it does not invest in the ownership of the property or possibility of making a profit from it. On the other hand, mortgage payments invest directly into owning a larger share and the eventual full ownership of the house. By paying off a mortgage, you have an opportunity to become a landlord yourself and make a profit by renting out your property. You will also have the ability to improve and sell the house in order to make a marginal profit. These benefits are not possible without initially taking out the loan and making the decision to invest in real estate in the first place.
OpenListings makes the process of advancing into the world of real estate easier by providing resources and educational articles for potential millennial home buyers. You can view one of their articles here: https://www.openlistings.com/blog/millennial-home-buyer-first-home-2017-survey/
Taking the step to homeownership can be intimidating, but the reward is a significant investment in your future. With the help of educational resources, careful financial planning and choosing the right lender, buying a home can be more attainable than ever.
Sources:
https://www.mymillennialguide.com/millennials-should-buy-a-home/
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