first time homebuyer

Young Buyers Prefer Walkable Communities, Says REALTOR Survey

Most potential homebuyers are not only looking for the perfect home, they are also looking for the perfect neighborhood. According to the National Association of Realtors® 2015 National Community and Transportation Preference Survey, when Americans think of their dream neighborhood they often think of a mixed-used, walkable community.

Realtors® are community builders and understand the complexities that go into creating a strong and successful community. “While there is no such thing as a one-size-fits-all neighborhood, more and more Americans, especially younger ones, are being drawn to mixed-use communities with a combination of homes and business and walkable areas.

Walkability is defined as a measure of how friendly an area is to walking. Can someone go grocery shopping on foot? Are there shops and restaurants within walking distance? Are there plenty of sidewalks, and are they well maintained? These are all factors taken into account when determining an area’s walkability.

According to the survey, millennials, those aged 18 to 34, prefer walking as a method of transportation by 12 percentage points over driving. Millennials are also the generation most likely to make sacrifices to purchase a home in these types of communities, such as buying a smaller home or buying a house without a backyard.

Younger buyers are looking for communities where they can walk to a restaurant and don’t have to drive to pick up their weekly groceries. However, it is not only millennials who are hoping to move into walkable neighborhoods; these preferences are seen across generations.

Based on the survey, women of all generations are more likely than men to show a preference for walkability, with 61 percent saying that the availability of sidewalks in a community with stores and restaurants to walk to is very important to them. And 48 percent of all respondents answered that they would prefer to live in communities containing houses with small yards but within easy walking distance of the community’s amenities rather than living in communities with houses that have large yards but are driving distance to all amenities.

As their preferences shift from the suburbs to urban centers, homebuyers continue to rely on Realtors® to help them find their dream homes and neighborhoods. Realtors® are the most trusted resource for real estate information and have unparalleled knowledge of local markets and conditions, helping their clients to fulfill their real estate goals.

Tips for Buying a Home with Friends

With housing inventory low and prices going up, some people are making the decision to partner with friends and buy a home together. This scenario allows people who otherwise would not be able to afford a house to share expenses and achieve the dream of becoming homeowners. But how do you know if buying property jointly is the right move for you?

It is important to remember that this is a business transaction, so you and your friends will have to approach it as such. You are going to have to have a very open, very frank conversation with your friends about their finances, their plans for the future, what to do if someone wants to sell, etc.If these are conversations you are uncomfortable having or you are worried about the effect they might have on your friendship, then buying a home with friends is probably not the right choice for you.

However, if you and your friends can come to terms, owning a home while sharing the burden of all the costs can help you build your savings while gaining equity in a home.

Here are some tips on purchasing a home with friends:

Review your friends’ finances. This is most likely the largest financial decision of your life, so now is not the time to hem and haw on questions of finance. You will need to be aware of everyone’s credit scores, income, savings and any other relevant assets. It is important to make sure that you and your friends are financially prepared to become homeowners.

Decide how payments and costs will be split. Questions to consider are how much each person will contribute to the downpayment and if that will affect how you and your friends divide the mortgage payments? Will the utilities be split evenly every month or will you alternate who pays? It is important that these details be worked out and understood by everyone involved before the home is purchased.

Decide on the type of house. Are you planning on buying a single-family home or a multi-family home? Do you see yourself sharing a kitchen and bathroom, or are you looking to buy a place where you will each have your own private residence? You should also decide ahead of time on everyone’s must-haves for the home. Knowing that your friend will only buy a house with a big backyard or that they will not buy a house on a corner lot can save you a lot of time house hunting.

Get everything in writing. It is important that all of the co-purchasers keep written documentation of all of your agreements regarding financial and other responsibilities. So many people think that because they are dealing with friends that there is no need to write up a contract, but it can help you to avoid conflicts and surprises down the road.

Work with a Realtor®. Buying a home is an important decision, and whether you are doing it on your own or with a friend, using a Realtor® is a smart move. A Realtor®, a member of the National Association of Realtors®, can provide counsel, discuss listings, show you homes in person, negotiate on your behalf and help you stay focused on the issues that are most important.

If you enter the arrangement educated and prepared, co-purchasing a home can be a great way to get your foot on the first step of the homeownership ladder.

Younger Buyers More Optimistic, Confident About Homeownership

The Millennial Generation

Despite an uncertain future, the Millennial generation – those 32 years old and younger – have more optimism and confidence about their recent home purchase than any other age group.

According to a recent National Association of Realtors® study that evaluated the generational differences of recent home buyers and sellers, 85 percent of buyers under age 32 believe their home purchase was a good financial investment. That is compared to just 50 percent of buyers ages 88 and older.

The oldest of the Millennial generation are starting to buy their first home. They understand that homeownership is one way to accumulate wealth, especially for younger families in today’s world. Currently, they might be facing an uncertain job market, mounting debt, and tighter mortgage lending rules, yet homeownership still matters to them, and they still aspire to one day become homeowners.

The study found that 79 percent of Millennials were first-time home buyers and 65 percent of them previously rented a home. Half of respondents said the reason for buying a home was their desire to own a home of their own. Twenty-two percent said the affordability of homes made them want to purchase. The Millennial generation is also the second largest group of recent buyers, accounting for 28 percent of recent purchases. They follow Generation X, those born between 1965 and 1979, who made up 31 percent of recent purchases.

The Millennial generation is the largest in history after the baby boomers and they are expected to give the housing market a boost. However, there are some significant challenges that might hinder their ability to purchase homes. Buyers with student loan debt may find it difficult to access mortgage credit, as well as save for a down payment.

The impact of student loan debt is a concern for future generations and their ability to become home owners, since those burdened with growing monthly debt payments will have restricted access to mortgage credit and could find it harder to save for a down payment.

The Greater Louisville Association of REALTORS (GLAR) agrees today’s young home buyers are facing challenges, yet those hurdles aren’t changing younger buyers’ attitudes about homeownership. There is still tremendous affordability in the market and interest rates are still low. Today’s market presents opportunities for young buyers to own a home and they recognize that. Realtors® are committed to making sure those who are willing and able to own a home have the opportunity to do so. Everyone should have the ability to pursue the dream of homeownership.