Millennials in Arizona: Top Concerns & Tips for Success
Home prices across the U.S, and much of Arizona, have seen steady increases over the last several years. The market in Scottsdale is experiencing increased demand as many people are looking to escape from over saturated cities. Home affordability has been especially difficult for millennial home buyers, which has resulted in many of them to stick to long-term rentals.
There are a few different factors that are deterring younger buyers from entering the housing market. According to a recent Redfin study, more than half of millennial buyers are concerned about the amount needed for a down payment. Other millennials cited difficulty of desirable location (45%), rising prices (41%), and increased competition in the market (28%) as top concerns.
These hesitations are not only discouraging younger buyers from getting started, it’s lessening the chances of millennial buyers submitting a winning offer on a home. Although the average down payment in Scottsdale was only 18% last month, the median prices are still upwards of 17%. This type of down payment requires a substantial commitment from someone who may not have the available income. With prices expecting to rise even further, what can millennials do to improve their buying power?
Here are a some financial tips for millenials hoping to improve their buying opportunities:
Watch Your Credit Score Like a Hawk
Less established buyers can be a riskier bet for lenders – this is why it’s particularly important to have a strong credit history. One way to improve your chances of qualifying for a mortgage is to keep close tabs on your financial history. Here are a few different things you can do to improve your eligibility:
* Pay off your accounts in full each month – make sure you have a balance of zero
* Consider your debt-to-income ratio and avoid taking out large loans before applying
* Check your score regularly and make sure you don’t have any outstanding debt
Save As Much as You Can
Even with loan options that require less money down, investing more upfront is a way to relieve higher payments and interest rates. Additionally, having a larger down payment will open up a variety of mortgage opportunities. Lenders are more inclined to approve a mortgage if the total amount of the loan is lower.