Millennials are not only addicted to avocado toast, but to HGTV because of dreams to own their own home. While millennials contributed more than $514 billion as part of the largest generation of home buyers in the United States, experts point out many still can't buy homes. By helping the younger generation overcome the top issues that stand in the way, it's possible to reach the millennial market as a home flipper. When it comes to how to sell your flip to millennials or how to buy a home to flip as a millennial, start with a budget. Most millennials can't afford luxury homes. Aim to flip a starter home to reach the young buyers. According to an article by cnbc.com, millennials are not self-indulgent or lazy. Instead, they deal with affordability issues and other generations' home-buying habits. A recent survey of people ages 18 to 75 revealed a lot of frustration related to housing.
Qualifying for a loan with a partner
Experts say millennials feel like homes as well as apartments are too expensive because of lower wages. Also, there are not as many starter homes on the market. Today's average home buyer is 40 years old with a median income of about $87,000. They are typically married or living with a partner. To tilt the odds of qualifying for a mortgage, some millennials team up with a partner. As a home flipper, keep in mind that your buyers will possibly want two separate living spaces within the home. By adding a door and a second kitchen, it's feasible to create a home within a home. By pooling resources, buyers are more likely to have a 20 percent or better down payment. Thirty-percent of millennials buyers say they went over their budget when buying a home. With the right financial partner, it's easier to stay on a realistic budget.
Outsmarting other generations
Housing analysts also point out millennials can't buy homes as easily because of younger and older generations. Generation Z competes for the starter homes. Also, baby boomers either stay put or downsize, eating up even more of the starter home inventory. Some millennials rent out part of their homes so they can afford a higher mortgage cost. One survey showed millennials have a more optimistic attitude about home buying compared to other generations. In fact, people in their late 20s and 30s are 49 percent more likely than older people to think the American dream is within reach, a Hearth survey reports.
While some young buyers opt to live with siblings or roommates, others buyers have small families. When flipping homes, stick to the basics as far as a fenced yard, attractive landscaping, a laundry area, at least three bedrooms and two bathrooms. Buyers of all ages love an open space concept, but a split floor plan provides privacy. When it comes time to stage your fix-and-flip property, gauge the reaction of potential buyers. While you can't easily change the floor plan to respond to criticism, it's easy to alter the staging. Because so many young buyers love to watch HGTV and other home improvement shows, stick to the modern and contemporary interior colors and styles such as Modern Farmhouse that feels right to the younger buyer.
At Center Street Lending, we provide short-term loans for investors ready to turn a fixer-upper into a dream home. Whether you are a first-time investor or an experienced home flipper, contact us and we can help with financing to renovate a home quickly for a solid return.