Why Columbus millennials can't afford to buy homes
It's getting harder to buy your first house in Columbus.
The big picture: Among U.S. millennials who don't own a home, 44% say income is the top barrier to buying, per a Bankrate study. And 43% say they can't afford the down payment and closing costs.
Threat level: Franklin County home values are poised to rise after being reappraised this year, which could further squeeze buyers' budgets.
Zoom in: First-time buyers are increasingly unwilling to pay over asking price or spring for a house that needs major renovations, according to Patti Brown-Wright, president of Columbus Realtors. It's one reason homes are sitting on the market longer, she tells Axios.
What's happening: Many who do buy get financial help. A Redfin report on "nepo-homebuyers" found 38% of recent buyers under age 30 nationwide received cash from family or an inheritance in order to afford their down payment.
- Brown-Wright says a small percentage of her clients end up renting for another year so they can keep saving.
Reality check: You don't need to put 20% down. The typical down payment in the Columbus metro area was 8.3% in April, according to Redfin.
By the numbers: Millennials make up more than 53% of mortgage requests in Columbus, per figures LendingTree shared with Axios.
Yes, but: Waiting to buy isn't a bad thing. "You can build wealth just fine by renting," says Bankrate chief financial analyst Greg McBride.
- Taking time to save, invest, build your credit and advance in your career can meaningfully grow your bank account, he says.
- Homeownership "sucks the cash right out of you," at least at first, McBride says. You need to save beyond the initial down payment to weather unexpected additional expenses — the top reason millennial homeowners have buyers' remorse, per Bankrate.
The latest: Housing industry groups are urging the Fed to stop raising interest rates.
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