Generation Y Floods Housing Market
Bryan Hollermeier is a good example of the new generation of home owner. He paid $273,000 for his first house when he was 23 years old.
He took out an interest-only, 30-year mortgage with no money down and planned to keep it for no more than five years. To enhance its resale value, he spent as much as he could afford on upgrades that would make the home attractive to families.
“What I would pay in principal I’m putting into mutual funds and investment accounts that make returns,” said Hollermeier, now 26 and a mortgage banker with Merchants Mortgage. “Equity just sits in your house.”
Hollermeier represents Generation Y, the group born between 1979 and 1984 that is now coming of age and buying homes. Demographers estimate about 65.3 million people fall into that age group, and they’re changing the way moderately priced homes are sold.
“Several years ago, the average first-time homebuyer was 30 years old,” said Justin Juarez, broker/owner of Metro Brokers Liberty Home Group LLC. “Nowadays, there are people who are 18 or 19 years old.” Generation Y buyers - roughly 22 to 27 years old - are more technically savvy than the Gen-X buyers who preceded them. Generally, they’ve done their homework online before physically inspecting the house. That’s where they find a lot of their Florida home loan information.
Gen-Y homebuyers also aren’t afraid to borrow money. Taking out a mortgage doesn’t bother them, said Angela Burdick, broker/owner of Metro Brokers Angela Burdick Real Estate.
“They’re optimistic because they’re highly educated,” she said. “They’re moving around and getting better jobs.” They’re also willing to sacrifice, either living with their parents to save for a down payment or taking a roommate to help with the mortgage.
Burdick also states that location is important to this group. They value their recreational time and don’t shy away from smaller spaces. Those that fall into this sector and are contemplating a Florida home loan should make sure they understand the process of making an offer.
