Previously, older generations used to save up their money to buy their houses and invest in the stock markets. Millennials on the other hand, decide to rent instead of purchasing a house. Many Millennials decide to rent instead of buy because of the large amount of debt that they have. Instead of taking on more debt, Millennials decide to forgo a mortgage.
A popular trend that we are seeing within real estate is that older generations are selling their homes ad renting apartments or condos while the younger generation, the Millennials, are continue to rent and invest in real estate properties. In this blog we will take a look at why millennial real estate investors are on the rise.
Millennials are the most populous generation in the United States.
The Millennial generation is the group of people born between 1982 and 2000. With over 75.4 Millennials in the United States, they have have the greatest impact in housing market shifts. This is why it’s important to understanding Millennials’ real estate and investment strategies.
Millennials are skeptic about the stock market.
Many of Millennials believe that real estate investments have a better return than investments made in the stock market. A lot of Millennials have this mindset because many of them were in college during the 2008 recession and found it challenging to find a job. Back in 2007, over 65% of Americans were investing in the stock market. Today, half of that percentage has left the stock market and is instead investing in real estate.
Real estate is on the up and up and Millennials have noticed.
One study shows that 86% of Millennials are planning on buying a house one day even if they are renting now. Some Millennials are known for being entitled and lazy, but they are actually pretty savvy investors. In general, they are producing a greater return on their investments. Millennials have been able to identify areas of population and job growth and track real estate market areas that are on the rise.
Millennials are investing in real estate online.
In recent years, there has been an increase in crowdfunding investments. Online crowdfunding lets anyone invest in real estate for a smaller initial investment. A lot of crowdfunding companies will require an initial investment of anywhere between $500 to $5,000.
One of the benefits of investing in real estate online is that you don’t have to deal with the hassle of being a landlord. Usually the crowdfunding or syndication companies will outsource property management.