As it turns out, buying at the market top can quickly lead to feelings of remorse.
With prices of single-family homes soaring the most on record...
...one recent survey found that millennials who decided to take advantage of low mortgage rates and buy a home during the COVID pandemic have mostly come to regret their decision.
As the survey from BankRate pointed out, buyer's regrets are even more of a factor in the pandemic, as agents compete even more ruthlessly for deals. Leave it to the millennial generation to normalize buying a home sight-unseen, and waiving contingencies that might allow them an escape hatch once problems emerge.
Unsurprisingly, the rush to buy is leading some to settle for properties that aren't quite right for them. Homebuyer regrets fell into two broad categories: financial and physical.
Also of interest: the survey found that, generally speaking, older buyers had fewer complaints about their purchases. Perhaps that's a reflect of the fact that older people have a better idea of what they want.
In total, 64% of millennial homebuyers, aged 25 to 40, have some regrets about their purchase compared with just 33%of baby boomers, aged 57 to 75.
By far the biggest regret among recent homebuyers was being unprepared for the cost of maintenance. More than 20% of millennial homeowners said they felt the costs of homeownership were too high, and that number jumped to 26% among those ages 25-31.
Millennials, well known for being fickle trend-followers, also reported finding that their home wasn't a good fit for them.
That those who buy during a market boom end up disappointing isn't surprising, since they have less time to make decisions, and are competing against a much larger pool of potential buyers.
"Because the market is so competitive, you have less time to make a decision on a homebuying purchase than you do on a laptop at Best Buy," said Olmsted. "You’ve already had, possibly, a couple of offers not accepted, you feel that pressure to make a decision and put an offer in."
For those looking to avoid being similarly dissatisfied, BankRate offered a list of helpful tips:
- Work with an agent who understands the market.
- Be ready to make some concessions, but stick to your guns on must-haves.
- Focus on whether a home is somewhere you’d be comfortable living, even if it’s not your dream property.
- Make a budget and keep it.
- Don’t rush into a deal just because you’re frustrated.
Another suggestion: remember, those who own their own homes are in the minority in the millennial generation. They should be grateful they aren't being forced to move back into their childhood bedrooms with their partner - because that's what some millennials are being forced to do to save for a down payment.