MILLENNIALS ARE HOMEOWNERS (IT’S TRUE!): A MYTH-BUSTING SERIES (Part 2)
There is a popular perception of America’s millennial generation when it concerns home ownership: They’re not ready to be homeowners.
This may be because Millennials, those young people between the ages of 18 and 34, are believed to have too much student debt, still live at home with their parents, and barely save enough money to be able to afford a home.
“Even if Millennials can afford to make a down payment, they are more likely to rent a home than to buy one,” says Mike Orr, director of the Center for Real Estate Theory and Practice at the W. P. Carey School of Business at Arizona State University.
The reason for this, he says, is that the idea of owning a home can be “intimidating.”
Or is it?
Contrary to popular belief, there are young people who are buying homes and living up to the big responsibilities that come with it.
The Home Story has spoken with three Millennial homeowners who share their journey of going from home hopeful to homeowner.
In this second installment we meet Stephanie Hill, a 23-year-old homeowner in Beacon Falls, Connecticut, who took the plunge into homeownership earlier this year.
The Hill sisters' home. (Stephanie Hill)
Relatives chipped in to help renovate the home. (Stephanie Hill)
A lot of work had to be done to make the place more habitable. (Stephanie Hill)
"Everyone else thinks it’s crazy that I am 23 years old and I own a house," says Hill. (Stephanie Hill)
It was the commute to work that did Hill in. Every day, she would have to make the one-hour drive from her parents’ home in East Haven, Connecticut, to her job in Danbury, followed by the drive back home, which was more like a two-hour slog through never-ending traffic.
The commute was a small — or considerable — price to pay for living at her parents’ home after graduating from Fairfield University in 2013.
“Living at home was fine, because I was saving money that I would otherwise be spending on rent,” says Hill, who works in the marketing department at a financial services firm.
But then there was the pesky commute that was wearing her down, and she was becoming desperate to find an apartment near her work.
As she had very little money to her name, Hill was resigned to renting rather than owning an apartment in the Danbury area.
“I am not a big fan of the idea of renting, because once you stop paying the bills, it stops being yours,” she says.
Out of curiosity, she started looking at housing listings, “basically seeing if anything came along that was the right fit,” she says. Her 25-year-old sister, who was also living at home, was interested in owning a home, and suddenly it dawned on them: Why not buy a home together? So they did just that.
As they had a limited budget to play with, they focused on listings online that were for fixer uppers and recent foreclosures.
They found one such house in Beacon Falls, a tiny town in southwest Connecticut with a population of under 10,000 people. The owner was a 92-year-old man who had let the home fall into disrepair after years of ownership.
“It had all the bones, it just needed to be freshened up,” she says.
They needed to install new hardwood floors, gut the two bathrooms, replace the plumbing system, and restore the basement and outdoor porch.
“The living room was huge, the bedrooms were all good sizes, there was a screened-in porch that was huge,” she says. “It just had the potential to be really good once you put in a little elbow grease into it.”
She and her sister put in an offer for the home, and within one week it was theirs. They paid $55,000 in cash for the home, an enviable price in an area where the average listing price is above $240,000, according to Trulia data.
But then there was the matter of the repairs that the home was in dire need of.
“The work we had to put into [the home] was another $35,000 to $40,000,” says Hill. As they had little money remaining, their mother agreed to kick in the extra money needed.
Today, while the house is still a work in progress, it is infinitely more habitable than what it was before, and she is also settling into the reality of being a young homeowner.
“Everyone else thinks it’s crazy that I am 23 years old and I own a house,” Hill says with a laugh.
She admits that the financial risks that come along with it (in the event of repairs and liabilities) are “intimidating.”
She doesn’t know how long she and her sister will live in the house — “we don’t really know where the next adventure in our lives will come from” — and they are approaching this as a five-year plan.
“It’s one of those things where, at some point, everyone’s got to take on a little more responsibility in our personal and professional lives,” she says. “So if I own a house now or if I do it 10 years from now, I don’t really see the difference.”