Published by REALTOR.com on October 7, 2020
The nation’s largest generation has been helped by record-low mortgage interest rates, according to a recent Realtor.com® survey.
This year’s coronavirus pandemic and the accompanying recession have turned a lot of people’s financial plans upside down. But those millennials who’ve been lucky enough to hang onto their jobs are fast-tracking their plans to buy a home, in part because the pandemic is helping them do so.
The nation’s largest generation has been helped by record-low mortgage interest rates, according to a recent Realtor.com® survey. Those low rates are helping to offset home prices that are at an all-time high in many places.
In addition, the survey results show that stay-at-home orders have helped these 20- and 30-somethings save money they might otherwise have spent going out, thus helping them amass a down payment.
“For those who have weathered the pandemic well by keeping their jobs, there have been some opportunities to become homeowners. They can take advantage of low mortgage rates, they may be able to save more for a down payment because they’re not spending as much going out.”
“But with unemployment rates very near record highs, we know that other millennials are likely struggling and may have to delay homeownership,” says Realtor.com Chief Economist Danielle Hale.
Almost half of millennials, 49%, pushed up their plans to buy a home due to the pandemic, according to the survey. Of the roughly three-quarters of millennials surveyed who are now working remotely due to the threat of contracting COVID-19, nearly two-thirds hope to buy a home because they can now telecommute.
Many are motivated to move because their current home doesn’t fit their needs anymore (26%), according to the survey. A big backyard, a home office, and space for the kids to do schoolwork never sounded so good! The second most popular reason for wanting to buy was to accommodate a growing family (23%), while taking advantage of low interest rates and living in a safer community accounted for the rest.
“Wanting to capitalize on low mortgage rates and buy before prices go up even further is accelerating the buying timeline,” says Hale. The average rate for a 30-year fixed-rate mortgage was just 2.88% in the week ending Oct. 1, according to Freddie Mac.