Many Bostonians Planning First Home Purchase, but Persistent Homebuying Myths Hold Back Others
Boston’s millennials are straying from the norm as they redefine life’s priorities, according to the latest Bank of America Homebuyer Insights Report. Sixty-eight percent of local millennials say owning a home is a top priority. Homeownership is second only to being able to retire (77 percent) and far outranks getting married (44 percent) and having children (41 percent).
The report, which explores the attitudes, preferences, and behaviors of the modern homebuyer, also finds that many local millennials equate homeownership with personal (51 percent) and financial (45 percent) success. Prospective millennial buyers in Boston also associate purchasing a home with maturity (46 percent), adulthood (44 percent) and independence (34 percent).
Additional Boston-specific highlights from the report include:
Local renters in Boston are torn on the “own vs. rent” debate, with 49 percent believing that renting long-term will be more expensive than buying a home. The other 51 percent say it will be just as or less expensive than owning.
Yet, 71 percent believe their rent will continue to rise every year or every other year. And 43 percent pay more than 30 percent of their income in rent each month.
When asked what they dislike about renting, Bostonians (54 percent) are more likely than their national counterparts (49 percent) to feel like they’re throwing money away. They’re also more likely to say “not feeling like it’s truly home” (48 percent vs. 43 percent).
Top renter misconceptions in Boston include:
- Thirty-eight percent believe that 20 percent down is required to buy a home.
- Fifty-one percent believe they must pay private mortgage insurance if they don’t put 20 percent down.
- Nearly a quarter believe they need to have a “perfect” credit score to be considered for a mortgage.
Who: While 67 percent of first-time local buyers plan to buy with a spouse or partner, others are venturing out on their own, with 30 percent planning to purchase their first home solo.
What: When thinking about their first home, buyers in Boston prefer:
- A starter home (51 percent) vs. a forever home (49 percent).
- More square footage (45 percent) vs. a large backyard (55 percent).
- A modern layout (61 percent) vs. a home with “good bones” (39 percent).
- Updated appliances (77 percent) vs. an updated exterior (23 percent).
Where: 41 percent are looking to stay in the Boston area, while 39 percent plan to buy elsewhere.
When: 37 percent of local residents plan to buy in the next two years, and 75 percent say saving for a down payment is a financial priority.
Why: Bostonians say having enough money saved (67 percent) and a higher salary (36 percent) are their top motivations to buy for the first time.
Learn more about the Bank of America Homebuyer Insights Report.
Bank of America’s Consumer Lending unit includes First Mortgage, Home Equity, Consumer Vehicle Lending and residential real estate lending for our Global Wealth and Investment Management business units. Each business is focused on delivering a distinctive and consistent client experience through competitive product offerings, quality loan production, choice of multiple connection and delivery methods, and operational excellence based on a client’s unique attributes and relationship with us.
Convergys Analytics conducted an online survey on behalf of Bank of America between January 16 and February 2, 2018. Convergys surveyed a national sample of 2,000 adults age 18+ who currently own a home or plan to in the future. In addition, an augment was conducted to reach 300 adults in seven local markets: Austin, Boston, Charlotte, Dallas, Nashville, Phoenix, and San Francisco. The margin of error for the national quota is +/- 2.6 percent, and the margin of error for the oversampled markets is approximately +/- 5.8 percent, with each reported at a 95 percent confidence level.
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Reporters may contact:
Kris Yamamoto, Bank of America