Tampa Bay millennials' secret to a down payment: family money

Many Tampa Bay young people buying homes now can only afford to with help.

Why it matters: A Redfin report on "nepo-homebuyers" found 38% of recent buyers under age 30 received family money in order to afford their down payment.

Zoom in: Azlyn Canchola and her husband bought a three-bed bungalow in Tampa Heights in April 2022. They saved for a few months, and family gave them cash for the rest of the down payment.

What they're saying: "We wouldn't have been able to buy at the time we did it without help," Canchola tells Axios.

• Mortgage rates were still relatively low and rent kept climbing, Canchola says. They decided to buy to lock in their monthly payment and build wealth.
• "We specifically picked our neighborhood for its future value," she says. They bought their house for $326,000, and homes nearby are currently on the market for $450,000.

By the numbers: While many millennials want to buy a home, nearly three-quarters of them say affordability is a major obstacle, according to a Bankrate study.

• Among U.S. millennials who don't already own a home, 44% say income is the No. 1 barrier to buying, per the study. That's closely followed by downpayment and closing costs (43%) and high home prices (42%).
• Mortgage rates and poor credit were among other top responses.

What's happening: Millennial mortgage applications were down in the Tampa metro for the first half of 2023, compared to the same time last year, according to figures LendingTree shared with Axios.

The intrigue: Roughly 20% of millennials say they want to buy but they're just not ready yet. And 8% of millennials say they never want to own a home, per the study.

Yes, but: Waiting to buy isn't a bad thing.

Be smart: "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 improve your financial picture, 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 No. 1 reason millennial homeowners have buyers' remorse.

Go deeper: Extreme weather could raise insurance rates nationwide, hiking the cost of homeownership even higher.