For many people, the American dream of owning a home is exactly that: a dream. The housing crisis, the high unemployment rate, increasing debt, and tougher restrictions on mortgage qualifications, make it seem especially hard for for generations like Gen Y. The millennias, as they’re also often called, are referred to as the group born between the mid-seventies to late nineties.
While this group came of age during turbulent economic times, homeownership is still a priority to them. It may, however, seem that factors are stacked against them. This group tends to be well educated –many went to college–and also have an entrepreneurial spirit that makes them creative with their money.
But for Gen Y, if they want to achieve the American dream, a few critical steps will pave the way to the road to homeownership.
Get a handle on debt. This generation likes the idea of being their own boss, working from home, tele-commuting or starting their own side business while still working full-time. They can be very creative in developing money-making jobs with the Internet and start-ups are often part of their dream job. However, sometimes these starts-ups are funded with only their credit cards, which can rack up a considerable amount of debt. If the company is profitable all is well but if not, they may be strapped with that debt which makes it very difficult to save for a home. Plus much of this generation has student loans that they’re still paying off.
Like anyone interested in buying a home, focusing on reducing debt will help prepare them to qualify for a mortgage. When possible, cutting back on major expenses is a good way to start saving for that home.
For the first time, people are keeping their cars longer than ever. Many people are opting to continue with repairs and maintenance rather than have a monthly car payment. This can be an excellent strategy to help save money as long as the repairs and gas money on the older car don’t equal more than a new car payment and cost of gas, registration and insurance.
Other ways Gen Y can save: cut the cable and home telephone cords. This can save more than $100 a month. This generation grew up with the use of computers and electronics. Many see no real need for cable or even Internet at home. Their offices are often coffee shops that offer free WiFi. They often use their smartphones and cellular data packages to watch shows and get the news. A home phone has become obsolete for many in this age group because they simply use their cell phones. Cutting household utility expenses such as these can end up saving them hundreds of dollars a year.
The more they can save, the better prepared to achieve the American dream of homeownership.
And remember, when you’re ready to buy or sell a home, contact a REALTOR, a member of the _____________________ Association of REALTORS.