Wealthy, urban-living millennials are more likely the rent in the city and buy vacation homes outside urban areas, according to financial website TheStreet.com. Some are looking at a second home as an investment opportunity without owning their primary residence.
The National Association of Realtors (NAR) says the average age of vacation home buyers is 43, compared to 2003, when the average age was 61. The NAR says buyers of all ages are taking advantage of lower interest rates in the second home market.
Rising real estate costs affect starter home purchases
The costs for first-time homeowners have been steadily increasing. The median home price in Denver at the end of 2018 was $383,000, according to Kiplinger, making it one of the most expensive markets in the U.S. For millennials, especially those with higher income and wealth levels, there are three critical takeaways for buying vacation properties:
- Renting longer and buying later: Millennials are waiting longer to buy, while homes are 39% more expensive than they were 40 years ago.
- Buying more expensive properties when they are ready: Many millennials are waiting until their mid-30s before buying and are more likely to look at high-end homes.
- Using vacation homes as rentals: While some millennials may live at the property for a portion of the year, many are renting them out as an investment opportunity.
Seek legal advice for your real estate investment
Buying a high-end property as your primary residence, for retirement living, or as a source of income can be a complicated and confusing process. An experienced real estate attorney here in Colorado will make sure you understand all your options from making your initial offer to closing, and help avoid complications, including lawsuits.