It’s a common misconception that younger generations simply don’t want to buy and would prefer to rent or lease for longer. But most statistical insight points to lack of savings for a down payment, or other financial considerations – such as a substantial amount of student debt – as key factors that delay buying a home.
According to a Zillow Housing Aspirations Report, a majority of Millennials believe that owning a home is necessary part of achieving the “American Dream”, and boosts their community standing. On average, first-time homebuyers are three years older and rent longer than previous generations. New findings have shown that ballooning student debt is a key reason for Millennials delaying homeownership.
Currently, borrowers under age 30 make up a larger percentage of borrowers than any other age group. Additionally, the majority of outstanding loan debts fall in the same age group, and those debts have risen almost 260 percent – $147.8 billion to $383.8 billion – since 2004.
For the portion of Millennials that did not attend college – or did not finish their degree – many still have financial burdens due to lower paying jobs, little savings and higher credit card debt. Without a stable base of financial awareness and a lack of savings discipline, they are in an equally tenuous situation but still want a home of their own with little to no resources.
In 2019, it is estimated that new homes will cost on average around $300,000 – about $150 per square foot according to HomeAdvisor. With an average income of $54,000 – and the average student loan debt per borrower at $32,731 – being able to afford a new home can seem like a pipe dream. Younger generations still want the benefits of homeownership, and affordability will remain a key concern when they are ready to buy. Factory-built home provide a balance of affordability and stylish options.
These homes are built in climate-controlled factories, which helps speed up the construction process and lessens the cost associated with its construction. In some cases, the average cost of a manufactured house can be almost half that of its site-built counterpart. And there are many federal, state and local codes and regulations that keep these types of homes high quality and regulated.
In some areas in the United States, such as West Virginia, South Dakota and New Hampshire, where the percent of residents in debt exceeds 70 percent, prefabricated homes may be the answer to many looking to own their home.