A new report from Bankrate has found that more and more millennials are experiencing homebuyers remorse after purchasing what was thought to be that home of their dreams.
The study found that nearly two-thirds of millennial homebuyers have expressed some degree of regret. The survey found that the older the buyer, the less likely they were to have misgivings about their purchase after the fact. In all, 64% of millennial homebuyers (ages 25-40) have some regrets about their purchase, compared to just 33% of baby boomer buyers (ages 57-75).
In an ever-tightening market, many homebuyers are jumping into situations that are less than ideal, as the study found homebuyer regrets primarily fell into two major categories, financial and physical.
One of the biggest regrets among recent homebuyers was not being prepared for maintenance and other costs associated with homeownership. More than 20% of millennial homeowners said they felt the costs of homeownership were too high, and that number jumped to 26% among younger millennials, ages 25-31.
“It can cause a rude awakening if one fails to plan for inevitable expenses,” said Mark Hamrick, Bankrate’s Senior Economic Analyst. “This is yet another reminder why making emergency savings a top priority is so important. Whether it is a roof repair stemming from age or storm damage, or the need to fix or replace heating, cooling or appliances, it isn’t a question whether such expenses arise, only when and how much they will cost.”
Millennials also felt they didn’t get a good mortgage rate, or that they overpaid for property, as 12% of millennials said their rates were too high, and 13% said they agreed to overpay for their home.
While financial frustrations topped the list of regrets for new homebuyers, many millennial respondents felt their new place was not an ideal fit, with 15% of those polled said they disliked their new property’s location, and 30% felt the home was not the right size.
Many cite the competitive market leaving very little time to make a sound judgement on a new home, forcing buyers into quick decisions.
“Because the market is so competitive, you have less time to make a decision on a homebuying purchase than you do on a laptop at Best Buy,” said Angelica Olmsted, an Agent with RE/MAX Professionals Cherry Creek in Denver. “You’ve already had, possibly, a couple of offers not accepted, you feel that pressure to make a decision and put an offer in. That is an insane amount of time to have to look at a property, see if you can live there, see if you like the neighborhood, see if a house has all the features you’re interested in. If you have 15 minutes to look at it, then trying to drive around the neighborhood at different times of the night and day to see if you want to live there, you don’t have time to do that adequate amount of homework.”
Click here for more on Bankrate’s study.