4 Out Of 5 Millennials Who Do Not Own A Home Intend To Buy Within The Next 5 Years

4 Out Of 5 Millennials Who Do Not Own A Home Intend To Buy Within The Next 5 Years

 A recent study by the HSBC  found that 80% of millennials in the United States who don't own a home intend to buy in the next five years. This is an independent consumer survey of 9,000 people in nine countries worldwide including 1,009 respondents in the U.S. Millennials in the study are defined as being born between 1981 and 1998.

 Millennials around the world say slow wage growth and housing price inflation as the greatest barriers to purchasing a home. The report indicates that along with these reasons, better financial planning as another obstacle for millennials to overcome.

David Gates, U.S. head of mortgage origination and sales for HSBC is quoted saying: "This study highlights that young people strongly value home ownership, yet there are significant challenges to making the dream a reality for millennials around the world. The perfect storm of stagnating salaries and rising house prices, paired with the need for improved financial planning can make buying a home a deferred reality."

The report found that 71% of millennials are saving more money for a deposit and waiting to earn a higher salary before buying a property

With an expected 1.9% increase in salary growth expected in 2017 and average property prices climbing by 4.8% last year, the dream of owning a home remains a challenge for many millennials.

Of the 71% who are saving for a deposit, 49% feel they are being held back because they cannot afford to buy the type of property that they would like. More than half of millennials who bought a home in the last few years ended up spending beyond their initial budget.

Among non-owners intending to buy a home in the next two years, 32% have no overall budget in mind and a further 54% have only set an approximate budget. 

These millennials who were surveyed say they are willing to make sacrifices. Among non-owners intending to buy, 55% would consider spending less on leisure and going out, 41% would consider buying a smaller than ideal place, and 27% would even be prepared to delay having children.

Of the millennials who have bought their own home in the last few years, 28% had to turn to their parents for funding to help with the purchase.

HSBC research identifies four actions that millennials can take to help make their home ownership dream a reality. Plan early and don't underestimate the deposit. Budget beyond the purchase price, in case of any extra costs. Consider sacrifices you can make to save more faster. Get a full view of your finances and find only a home loan you can afford.

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Dante Escobar Headshot
Phone: 863-259-9307
Dated: March 31st 2017
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