The real estate market has been redefined by the global COVID-19 pandemic. With historically-low interest rates and newfound remote work options, people are considering new housing options unlike ever before. While each real estate transaction is unique, experts continue to weigh in on generational styles. Millennials appear more comfortable in the fast-paced, tech-savvy environment while Gen-Xers and Baby Boomers remain careful and holistic. It’s easy to assume the older generations are simply unable to keep up, but here are several areas where Millennial homebuyers could learn from their parents.
Interest Rates Should be Kept in Perspective
Even while the Fed is pushing mortgage interest rates higher in order to minimize inflation, interest rates are still historically very, very low. The lowest mortgage rate was recorded in December of 2020 at 2.68%. In comparison, Baby Boomers and Gen-Xers have experienced rates six times that in their adult lives. During the 1980’s Freddie Mac’s 30-yr fixed mortgage rates ranged between 10-16%. Millennials may have trouble keeping current interest rate hype in perspective, but rates have truly never been more affordable than they are right now.
Buying a Home Provides Security
Some Millennials are staying on the sidelines because home prices are too expensive. Historically speaking, homeownership has been one of the largest investments for families. Past generations would argue that owning a home provides families with safety and security. Monthly rent prices are soaring, making homeownership a viable option for first-time buyers. Understanding available loan options are the key to encouraging entry-level homebuyers to get into the market.
Your Home is Part of a Larger Financial Picture
Yes, the post-pandemic real estate market is creating competition unlike anything we’ve seen before. But as first-time homebuyers rush into bidding wars, they could take note of their parents’ cautious mindsets. Baby Boomers often balance risks with rewards whereas Millennials are more comfortable making quick decisions, sometimes without seeing the larger financial consequences. Owning a home can be an investment that appreciates over time, but it often means carefully choosing the right property at the right time. While advantageous during such a hot market, Millennials’ winning attitudes may benefit from a dose of Baby Boomer risk management.
Real Estate Professionals Provide Value
Contactless real estate transactions are the new normal in the post-pandemic world, but Baby Boomers would argue against doing it yourself. Working with a trusted real estate partner when researching, financing, and making an offer on a property can not only help Millennials learn the finer points of a local market but can also avoid costly mistakes. This is especially true when purchasing investment properties or second homes. Resort areas, for example, may have strict rules that could complicate the transaction. Often, there is simply no substitution for a trusted advisor.
Committed to Professional Real Estate Service
Beazley Realtors was built on personalized customer service and is a Berkshire Hathaway HomeService’s network team. We are dedicated to helping clients from all generations find homes that suit their needs. Contact one of our agents today for a complimentary Lifestyle Planning Guide.