Our 20-something son just bought his first home – a studio condominium. I assisted with a few tasks he couldn’t accommodate in his work schedule. Each week of the hunt, and after his offer was made and accepted, I made a list (of needed work) and checked it twice. Let’s just say the previous occupant, a renter, was not the cleanest, most careful person; several repairs had to be bid and managed.
Our son knows he’s lucky to have some family help and a solid job, which made this move possible. Many of his friends are un- or underemployed, living with their parents or in small, shared apartments. Others, back in school seeking an edge in the job market, live in student housing. They’re the norm: A Gallup economic survey conducted last year found that only 21% of Americans ages 18-29 are homeowners. Still, 7 in 10 young Americans who don’t own a home told Gallup they want to buy a home within the next 10 years – assuming they find a home they can afford.
While Gallup found that income has a positive correlation with the ability to buy a home, it’s not a cut and dried equation:
“… the hope of being able to buy a house is relatively strong even in the minds of those with below-average incomes, given that between 35% and 40% of Americans making less than $50,000 a year say that while they currently don’t own a home, they plan on buying one in the future.” – Gallup 2013 Economy and Personal Finance survey, April 2013
Even if you find a reasonably priced home you love, have the down payment, and can afford the payments at prevailing interest rates, buying isn’t always right for you. The New York Times has a nifty online calculator you can use, that considers such factors as how fast prices and rents are predicted to rise, and how long you plan to stay in your home. The calculator doesn’t account for personal preferences or emotional factors, but it’s a good start if you’re analytically minded.
I’m excited for our son. It’s a milestone in his life. Fingers crossed no appliances blow up after his warranty expires, before he can afford to replace them.