Earlier this year, LendingTree published its findings on the most popular cities for millennial homebuyers. They found these ten cities by analyzing the mortgage requests made on their platform across the nation’s 50 largest metros from January 1st to December 15th, 2020. They define millennials homeowners as individuals born between 1981 and 1996.
Top 3 Best and Worst Metros for Millennial Homeowners
The top three most popular metros among millennial homebuyers were San Jose, California, Boston, and Denver. At No. 1, San Jose had almost 62% of mortgage requests coming from millennials, with an average age of 32.12. The average requested loan amount was $704,318, with an average down payment of $158,040 and an average credit score of 730. The least popular metros for millennial homebuyers were Las Vegas, Tampa, and Phoenix.
Out of the 50 largest metros ranked by their millennial homebuying popularity, Austin ranked No. 8. A little over 57% of purchase requests were done by millennials, with an average age of 31.41. The average requested loan amount was $288,461, with an average down payment of $47,940 and an average credit score of 687.
Tips for Future Millennial Homeowners
If you’re a millennial wanting to buy a home in Austin, follow these tips to be financially prepared!
Improve Your Credit Score
Your credit score will determine your mortgage interest rate because this shows lenders how you manage debt. A higher score will give you a lower interest rate which means you’ll be saving money long term. You can improve your credit score by making on-time payments and not utilizing the entire credit line available to you on credit cards.
Decrease Your Debts
Lenders also look at your debt-to-income ratio. This is the percentage of your gross monthly income that goes toward recurring debts like mortgage and all debt payments. Ideally, you want this to be at or less than 36%.
When you’re buying a home, you’ll spend at least a couple of thousand on a down payment and closing costs. And once you own the house, you’ll have maintenance, property taxes, and several other homeowner expenses that you didn’t have to account for before. Start saving early by making regular monthly deposits so you’ll have a healthy amount of savings when it comes to making your home purchase.
If you need help purchasing a home in Austin, contact us!