Is it Worth it for Millennials to Buy a Home?


For decades, homeownership has been key to the American Dream. Buying a house has just been a natural part of adult life—and everyone’s always known it. In recent years, though, the concept of homeownership has been besieged, in particular among younger folks who may be wary of making such a major financial commitment.

So what’s changed? It’s likely that much of the blame for this shifting perception belongs to the Great Recession, where members of the millennial generation saw the worst-case-scenario for homeownership. This shakiness about homeownership has led many to conclude that maybe buying a house isn’t the wisest of investments.

Risk and Reward

Let’s be clear about one thing: Buying a home is risky. There are things that could potentially go wrong. Then again, renting is also risky—and, well, you’ve got to live somewhere.

What makes renting such a risky decision? While you’re in your youthful, working prime, you’re essentially throwing money away; you could spend $1,000 on rent every month for 40 years and, when all is said and done, not have anything to show for it. And what happens once you are out of your working prime? What happens when you retire? You’ll have a more limited income stream and no home to call your own—hardly an ideal position to be in.

In other words, there are always going to be risks, always going to be things to be afraid of. So don’t let fear make the decision for you. Instead, think it through: Are you in a safe stage of life where you can make a responsible decision about investing in a home?

Are You Ready for Homeownership?

Here’s a checklist to help you make that decision. To approach home buying from a smart vantage point, make sure you can check off each of these boxes.

  • You have a steady/stable job, and plan to remain there for at least a year.
  • You work in a field where you can find new employment if things go badly.
  • You can take on a mortgage without it sending your debt-to-income ratio to about 30 percent.
  • You have a backup plan for paying off your mortgage—either sharing the burden with a spouse or bringing in a roommate.
  • You plan to stay in the area for at least three to five years.
  • You’re okay making some household repairs by yourself.

It’s important to emphasize the point about staying put for three to five years, something you will need to do to have enough equity in the home to move on without taking a big loss. If you plan on moving around a lot, then renting really may be better for you—but if you meet all of these criteria, it’s time to think seriously about buying your own place. The Minges Cline team can help. Contact us today to start viewing some homes in the greater Charlotte area.