The Competitive Suburban Home Buying Market For Millennials

For the past few years, it’s been widely reported that millennials have been opting for living in more suburban areas. This certainly hasn’t changed in 2021, but the market has gotten much tighter and more expensive. Let’s discuss this intense market and what it means for millennials looking to buy!

Price Increases

Even in light of the global pandemic and economic downturns, the U.S. witnessed a dramatic increase in home prices the past year. We’ve seen 105 months straight of gains! This can be chalked up to competition for a limited number of homes alongside all-time low mortgage rates. 

What 2021 is Telling Us

Redfin, Zillow and Realtor.com have all shown that modest home price increases will maintain throughout the year. Predictions show that there will be growth of around 5%; only 1% lower than 2020. More home sellers are expected, especially as we approach the second half of the year and pandemic concerns are alleviated. 

There is currently an influx of millennial first-time homebuyers coming into the market as well, making competition even stiffer. Despite home price gains, low mortgage rates should help keep homes affordable for entry-level buyers this year

Tips for Suburban Home Buyers 

• Stick to the budget you’re comfortable with. Don’t go over just so you can win a bidding war. 
• Don’t expect to get a deal with the current market. Sellers are in control here, and you will probably have to go above asking price to get the home you want. 
• Get preapproved for a mortgage prior to making an offer; you’re just wasting time otherwise. 
• Qualify for the lowest mortgage rate you can. Be sure your credit score is looking good (ideally at least 700) and shop around for the best rates. 
• Put up the highest down payment you can. 20% or higher on a conventional loan will get you better rates and you won’t have any mortgage insurance to pay. 
• Win a bidding war by submitting an offer with fewer contingencies (such as no home inspection or appraisal), write a personal letter to the owner, or offer a rent-back agreement that allows the owner to stay in the home for a certain period of time following the sale. 

The Bottom Line

If you’re looking to buy in the suburbs or city, get in touch with me today. We’ll find you the perfect fit, even in this crazy market!