Millennials, as you probably know, are the generation of Americans between 18 and 30. They own smartphones, tweet, and use Facebook whenever they get a chance. They have become the poster children of the digital revolution with tattoos, piercings and college degrees, but don’t be surprised if you find them living in their parents’ basements. That’s right, the people of this digitized generation are more likely to be squatters or renters than homeowners. With mountains of student debt, low employment rates and high alcohol consumption, Millennials are opting for more cost-effective solutions to sheltering themselves.
Student Debt
Education is important to Millennials and it is becoming abundantly clear that this generation will soon be the most educated group ever. Though only 19 percent of Millennials have a college degree, 44 percent of them plan to graduate with a degree. This is great news, except for the fact that the cost of college has skyrocketed since Gen Xers and Baby Boomers were last in school. The costs of a college degree have grown almost 500 percent since 1985, leaving recent and future graduates with a mountain of debt.
If the facts stated above fail to paint a clear picture, let me help. The Millennial generation is so overburdened with student loans already that it is difficult for many of them to get a loan for a house. And why would they get a home loan? Their bags are already filled with debt and I’m sure the idea of another loan seems quite off-putting.
Low Employment Rates
Jobs are hard to find these days. And I’m not talking about the type of jobs where you end up flipping burgers at McDonalds, because those aren’t what Millennials need. I’m talking about the type of jobs that lead to careers and a stable, comfortable life. And it has become very clear to Millennials that their overpriced education may not aid them in this search.
Now you’re probably asking why these intellectual individuals are having such a hard time finding a job. Well, other than a bad job market, it might have something to do with the fact Generation Xers and Baby Boomers (the ones making the hiring decisions) dislike working with Millennials. In a survey conducted by Ernst & Young, it was quickly found that the standard Millennial was a lazy, blundering money vacuum with tendencies to be a lone wolf (my words, of course).
Alcohol Consumption
Millennials…like…alcohol. They like alcohol more than previous generations and are more likely to buy higher-priced liquor or wine based solely on the fact that they think high price means good quality. Purchasing alcohol might not relate directly to a Millennial’s tendency to buy a house, but think about it. They have no job and mountains of loan debt, so a good portion of what they earn will probably go to alcohol.
So Millennials are definitely not the first group you should approach when selling a house. Even if they had a job and could acquire a loan, the instability of the times coupled with student debt will direct them to more flexible solutions. Also, why would they buy a house when they could just drink themselves into comfort?
Byline
Joseph Patty, a freelance blogger and former real estate agent, recommends Protect Your Bubble renters insurance for those who opt to rent rather than own.
Image credit goes to CityOfCincy.
