Why Millennials are struggling with Real Estate:
If you’re a millennial and are discouraged to enter the Real Estate market, you are definitely not alone!
As you can see in the graphic above, Millennials across the country have different barriers when it comes to home ownership. The North East suffers from credit card debt, the South East has credit score issues and is not well informed, in the Midwest we have student loan debt, and the Southwest and West coast we have issues with coming up with a down payment.
Being native to California and having lived in all 3 major hubs (San Francisco Bay Area, San Jose (Silicon Valley), and the Greater Los Angeles Area, I am familiar with the staggering price of Real Estate. However, given that rent has never been higher and will only continue to increase, I find true value in becoming a home owner; not only for personal reasons but financial as well. It may seem like a daunting task to be able to afford a home some day, but with a little research, it is possible if you are willing to work for it. But how can we come up with 20% for a down payment when the average price in California is $400,000?
There are a few ways Millennials can get into a home on the West Coast without putting 20% down while avoiding Premium Mortgage Insurance (PMI). One such way: 80/15/5, First loan at 80%, second at 15%, and 5% down. With this example, your down payment would go from $80,000 ($400k x .20) to only $20,000 ($400k x .05). A good credit score always helps, but where there’s a will, there’s a way!
Make a plan today to be ReadyForTheKeys tomorrow!