Here’s Where Millennials Messed Up When Buying a House — Don’t Do the Same

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Home buying process
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Millennials get a bad rap.

Yes, we may do things differently than other generations, but we don’t all want to live with our parents forever or forego homeownership indefinitely in favor of renting.

Yet with mountains of student loan debt, wages that aren’t keeping up with inflation and all the questions that come with buying your first home, there’s good cause to hesitate a little.

When the time is right, we want to do it right. And the best way to do that is to learn from those who have messed up in the process.

Sharing is caring. Hopefully someone’s pain can be a lesson for the next person.

Millennial Regrets About Homebuying

NerdWallet’s 2017 Home Buyer Reality Report showed that 57% of millennial homeowners surveyed would do something differently if they got a do-over on the homebuying process. More than a quarter — 28% — wished they’d saved more before making the purchase.

After buying their homes, 11% felt less financially secure.

That’s not to say millennial homeowners regret their purchase overall — only 4% did, and only 10% thought they should’ve waited longer. But there are some major changes some would have liked to make.

If They Could Turn Back Time

Nearly 1 out of 5 — 19% — wished they’d purchased a larger place. Twelve percent said the amenities and features they initially appreciated have gone down in value since they bought their homes.

Almost half — 46% — found the homebuying process stressful, although 37% reported it was manageable and rewarding.

Of those who would change things if they had a second chance, 15% would research the homebuying process more; 12% would research the mortgage-lending process more; and 14% would keep better organization of all the paperwork.

Unexpected Homebuying Budget Items

While it’s easy to get caught up in the home price itself, there are a bunch of related costs that can derail homebuyers if they don’t think them through.

HSBC’s 2017 Beyond the Bricks study surveyed over 9,000 millennials in nine countries and found that 56% of U.S. millennial homebuyers exceeded their budgets when they purchased their homes.

Of those who reported overspending, 45% cited renovation costs and 41% cited furniture costs.

Of those surveyed who were not fully satisfied with their homes as-is, 45% said it would take renovations or remodeling to bring their approval up to a five-star rating.

Fifteen percent said they’d need bigger or more rooms; 10% would prefer a better location; 9% want specific features added, like a pool; and just 4% wanted more or improved outdoor space.

So before you put all your hard-earned money into your first house, make sure you fully consider all the costs involved in making it a place you love to come home to every day. Take time to crunch all the numbers — even if it means stepping away from the glory that is HGTV.

Your Turn: Do you have any homebuying regrets others can learn from?

Nicole Dow is a staff writer at The Penny Hoarder. She can’t wait to buy her first home — but will wait until she’s saved more money and done all her research.

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