The home values in the Seattle area are at an all time high. The median price for a single-family home in Seattle is $777,000 and $950,000 on the Eastside. The Seattle Times recently reported that "Both Seattle and the Eastside have smashed home-price records as the region's market continues to be brutal for homebuyers even before the peak spring season kicks off."
Winter in real estate is notorious for lower inventory, and often lower prices, but it may just be one of the better times of year to buy. Most real estate news during the winter is akin to lowering median prices, a slow in construction, and a dip in overall housing inventory. However, even with all of these things popping up in news headlines across the nation; Seattle's housing market continues to come out on top.
What are the hottest cities for Millennials to buy homes in for 2016? A recent Realtor.com article outlines, "Where's Hot - and Where's Not - For Home-Buying Millennials" in the coming year. As Yuqing Pan writes millennials are making their presence known in the housing market: "numbering 43.5 million, the older group of millennials (aged 25 to 34) makes up 13.6% of the U.S. population but fully 30% of the current population of existing-home buyers."
Rather than try to move to "trendy" cities with high price tags such as New York City and Los Angeles, "young home buyers are increasingly turning to cities that are relatively affordable and have lots of jobs and maybe even a trendy atmosphere all their own." And one of those more affordable cities for 2016 is likely to be Seattle.
With a median listing price of $398,000 and a 14.9% population share of older millennials, Realtor.com places Seattle 7th on their list of 10 cities, writing that "the headquarters of Microsoft, amazon, and many other tech companies large and small" mean that there has been "an influx of educated, young tech workers, which contributes to its uniquely cool culture." And of course, don't forget about Starbucks of course!
It's no secret that rents are on the rise; it can certainly feel daunting to even think about purchasing a home when so much of your income goes to paying rent. Fear not! Realor.com, recently came out with a way to be able to start stockpiling and saving, even amidst growing rents.
Every little bit helps! Some of your everyday expenses add up; limiting some expenses that could be deemed 'frivolous' can easily be put towards saving. Other actions such as finding places to rent that don't have such limiting rental obligations are also essential!
In a recent letter to millennials, Jonathan Smoke of Realtor.com describes the biggest obstacles preventing millennials from homeownership. He nailed down four factors that are giving millennials the most cause for concern:
- Student Loan Debt - This can cause problems when trying to secure a mortgage, because "in order to get a qualified mortgage, you need a DTI of no more than 43%, so a very large student loan balance could disqualify you right off the bat."
- Credit Score - Given that history is one of the largest factors in determining credit scores, caution is necessary because "the average FICO score for a millennial with a mortgage this year is 714" whereas the average score of an American is 695.
- Down Payment - While having that 20% down payment is ideal, "the average millennial this year could only put 7% down." Smoke suggests aiming for a 10% down payment and saving as much as possible.
- Rents Are Rising - Many millennials are concerned with rents that keep rising faster than incomes: "the majority of renters in the U.S. now have to spend more than 30% of their income to rent a typical home, and that means they're starting to sacrifice spending in other areas such as food and health care."