Majority Of Millennials Regret Buying Homes During The Pandemic
Almost 65% of millennials now regret their home purchases according to a new Bankrate survey.
This may be a shame for all of those who got caught up in the home buying frenzy of the past year. Yet, it also signals some new opportunities for real estate investors as well.
Homebuyer Remorse Grips Millennials
According to the data the majority of millennials now regret buying homes.
Some of the top reasons they are giving for this distress include:
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Additional homeowner expenses like maintenance costs
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Buying a home that is too big or too small
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Home mortgage payments and rates too high
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Buying in a bad location
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Overpaying for their homes
It seems millions just jumped into the market on a whim, without really thinking the decision through, doing a budget, analyzing what was important in a home, or educating themselves about the market.
How Wholesalers Can Help Out
In many scenarios these homes have quickly become a burden for homeowners. It’s now just a big payment each month. One that prevents them from enjoying the life and freedom they really want. It’s stressful. For a lot of homeowners it may be unsustainable.
As a real estate investor you can help them out. Even if they bought at the peak of the market in the past year, soaring inflation and frenzied competition means those properties could easily have 20% more equity in them now. For some, that is enough money to make a decent profit on wholesaling them.
All many of these owners probably want is enough money out to go move into a nice rental.
Some won’t act in time, and unexpected maintenance, repair and property tax bills will bankrupt them. That can turn into nonperforming loan notes and REOs. Both of which can be buying opportunities for investors.
Wholesaling To Landlords
Equipped with this information and facing a changing market, investors may want to expand or change up who they are reselling properties to.
Many retail buyers are getting priced out of the market. It is true that interest rates are low. Yet, recent data shows that it will now take South Florida homebuyers 17 years just to save up a 10% down payment. That’s 34 years to save a 20% down payment. That could certainly lead to a decline in homeownership.
While many rehabbers have been sitting on the sidelines during the pandemic according to ATTOM Data, and will continue to due to hyperinflation of construction materials, other types of buyers are scaling up.
Buy to rent landlords are growing as fast as they can with cheap money, and in anticipation of a new wave of renters coming to the market. These end buyers may have lower profit expectations, and are likely to be bulk or repeat buyers too.
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