Millennials have caused a wave of change in society in numerous ways. In terms of industries, the real estate market is no different from any other business that has witnessed a shift in mentality and buying habits. Unlike people born in the previous eras, millennials are a pro-renting generation. They aren’t the keenest lot when it comes to buying property and while most businesses and agents are aware of this, many are confused about where this behavior stems from.
Millennials are comfortable with renting good quality products and services in nearly every section of their lifestyle. From renting rooms instead of buying vacation homes to hiring cabs with just one tap instead of buying a car, this age group prefers renting as a way of life. This preference extends to homeownership too, making them choosing rent over possession in the long term.
Unlike some older generations, younger kids have shunned the idea of considering homeownership as a status update on their success. This pushes them further away from investing money in a home and placing their bets on a comfortable, rented accommodation. They are also less likely to attach property with the idea of lineage and don’t feel the need to make such major purchases – an opposing notion from that of their grandparents or great-grandparents.
Be it property taxes, mortgage installments, or home insurance – buying a house does not work out to be a cheap sweep. Millennials are unable to earn significant amounts as most of them are still struggling in the initial stages of their careers, resulting in smaller savings. Simultaneously, basic property rates are soaring sky-high and the market tends to lose its stability quickly in some countries and situations. This further makes their buying power much weaker than what is required to purchase and uphold a home in a safe neighborhood with decent amenities.
Whilst discussing millennials, convenience cannot be left out of the conversation. Younger age groups need flexibility in leases as they are more likely to move cities for better opportunities, further studies, and income. Several millennials find it a hassle to participate in the expensive maintenance of an owned house, making them choose rented apartments where that aspect is usually taken care of. Everything from newly moving into legalizing things with a roommate is more convenient when the homeowner is someone else.
Millennials want to save time in their busy lives and furnishing a place from scratch or painting the walls does not help with that. In the case of millennials experiencing a major move in their lives, the after-effects of buying a house don’t help either. It takes a large portion of time, effort, and more finances to put up a pre-owned house on the market and find a buyer for the same.