As it turns out, millennials aren’t the generation that rents apartments. According to Mynd’s 2022 Consumer Insights Report, some millennial and Gen Z homebuyers are pursuing homeownership to increase their wealth. However, this may be different from how earlier generations did it. According to the survey, they are entering the market as follows:
Younger generations of Americans do not have the same level of belief in that goal as older generations do. More and more Americans are deciding to buy their first piece of real estate as an investment.
Some young purchasers are acquiring a property, so they may use it as a rental rather than buying one and moving into it themselves. This strategy may become more popular due to the difficulties with affordability brought on by today’s increased mortgage rates. How many members of this group are contemplating this strategy is mentioned in the report above. It reads:
“Only 9% of Baby Boomers and 27% of Gen Xers are contemplating owning an investment property, compared to almost half of Millennials and Gen Z (43%).”
Why Younger Buyers Are Purchasing a House to Rent Out
This method enables purchasers to stay in their existing residences where they couldn’t afford to buy, such as the busy metropolitan apartment complex or their beloved neighborhood. They buy a house in a more inexpensive area to rent rather than abandon their dream of owning a home.
They are, in a sense, obtaining the best of both worlds. They still own a property where they can afford it and live where they choose.
Both passive income generation and asset diversification are priorities for them. The equity they develop in their home will increase their net worth over time and provide them with a rental income stream.
To sum up
If you’re considering purchasing a house as an investment plan to increase your wealth, get in touch with a real estate agent to discuss your alternatives and potential neighborhoods where you could find properties that meet your criteria.
The Real Estate Edge 