Millennials should buy homes young

Nicole Christianson, a 26-year-old sales rep, was tired of writing big checks for tiny apartments. And she wanted to do more with her cash than stash it in a savings account.

One night, she and her husband Thure, 28, took a look at their newly combined finances and uncovered a pleasant surprise: Together, they had saved enough for a 5 percent down payment on the affordable fixer-upper right across the street from their Milwaukee apartment. They closed in December 2017, and Nicole Christianson says they’re happy to finally be “making something that’s ours.”

Many in Christianson’s age group are chasing that feeling. Eighty-two percent of young adults say owning a home is a priority, according to Nerdwallet’s 2018 Home Buyer Report. If they can make it happen, most will be first-time homebuyers, but that “if” looms large.

Millennials (those born from 1981 to 1997) are buying houses at lower rates than when previous generations were the same age, perhaps because they’re grappling with student debt, underemployment and high rent costs, making down payments and good mortgages harder to come by.

Still, research shows there are big rewards in store for those millennials who find a way to buy their first home sooner rather than later.

Among today’s adults, the age at which they bought their first home meant as much as $100,000 difference in housing wealth by their 60s.

Thinking about homeownership as part of retirement planning is important for millennials, says Jung Hyun Choi, a research associate at the Urban Institute.

To make buying a house more feasible earlier in life, there are mortgages with down payments far below the traditional 20 percent and programs that assist with mortgages, down payments and closing costs.