More millennials are valuing homeownership these days and trying harder to gather the funds to buy a home of their own, as a recent survey conducted by Washington, D.C.-based business advisory firm the Collingwood Group indicated.
The survey, released Tuesday, showed that 65 percent of people polled between the ages of 24 and 34 were willing to forego modern conveniences in order to save for a down payment to purchase a home. Those conveniences might include cell phones, Internet, cable TV, and Starbucks, according to the Collingwood Group's exclusive survey.
About 75 percent of millennials, commonly known as generation Y, would rather apply for a mortgage loan with a traditional bank as opposed to an alternative lender or nonbank institution, according to the survey, indicating that millennials think more like their parents when it comes to obtaining financing for a first home. About 68 percent of those ages 35 to 75 said they prefer a traditional bank to handle their mortgage loan.
The survey also found that millennials were not willing to pay more for a streamlined mortgage process online despite the generation's focus on the Internet. About 21 percent of millennials polled said they would be willing to pay slightly more for a mortgage "if the application process was completely online and streamlined versus more offline and paper-based" as opposed to 24 percent of people ages 35 to 75 who said they would pay more.
"The data on millennials that own their home who would pay more for a better process is also notable. On the most expensive purchase of their lives they are willing to pay more because the current process is so God awful," Collingwood Group Chairman Tim Rood said. "Price matters to millennials who have lower incomes and more debt and the mortgage industry MUST figure out ways to become more efficient and streamline operations to reduce costs. The whole process is clearly ripe for disruption."
The survey called into question the perception that millennials prefer the city; about 70 percent of those polled said they prefer to buy their first home in the suburbs.
"It’s fascinating that millennials want to live in the city while they’re single but want the American Dream of white picket fences and yards when they are ready to buy, according to our exclusive poll," Rood said. "That is so critical given the ambiguity and fear that millennials will get hooked on urban conveniences and abandon the suburbs, leaving baby boomers and other downsizing households in the lurch."
Click here to download an infographic that includes the full results of the survey; the Collingwood Group polled a random group of 650 people between the dates of July 5 through 8, 2015, to obtain the survey results.