Until quite recently, millennials have been known as being averse to putting down roots and buying real estate, preferring to rent so they can relocate for new work opportunities. Indeed, this preference led to a growing rental property market.
However, a new trend has emerged as millennials take a different view of property ownership. Many have begun investing in real estate by purchasing a residential home or buying rental homes to join the lucrative business of being a landlord. Why has this happened?
Looking beyond borders
Millennials have expressed their interest in buying property since the market recovered from the 2008 Financial Crisis. They understand that real estate is a smart investment. Many are still not choosing to commit to buying a residential property. Instead, they are focused on becoming rental property owners. Some are looking further afield and investing in homes outside America by looking for Costa Rica properties for sale, according to Blue Water Properties of Costa Rica
Many buy such homes, intending to rent them out to facilitate repaying their mortgages. They are also a safe long-term nest egg and can be sold once their owners stop working and are utilized as retirement homes.
Lessons from years gone by
Most millennials are stock market skeptics. Watching their families weather the 2008 Financial Crisis growing up or starting out as young adults had a profound impact on their view of stock market trading. Indeed, many millennials avoid stock investments because they do not trust them. Having witnessed how people’s life savings can be eviscerated in a matter of seconds has left millennials wondering if stocks are the best place to invest their hard-earned money.
This has made real estate investment an attractive option for millennials. They understand that the housing bubble played a significant part in the Great Recession but believe that lessons learned from it will ensure it does not happen again with such ease.
While statistics on millennials investing in property might seem impressive, one should view them in the context of America’s population demographic. The millennial generation is currently the largest economically active population group in America. This makes them the most active in the housing market. Indeed, their preferences wield great power over real estate trends because they dominate buyer numbers.
This fact means that any property investors that fall within another age group should be watching millennial property investment trends. They are significant and drive market performance, causing impacts and changes for property owners of all age demographics.
Like older generations, millennials understand the value of tangible assets vs. the uncertainty of intangible assets like stocks. Seeing the fruit of their investment before their very eyes is comforting to a generation that came of age in such trying economic times.
As most investment experts advise, buying property is a surefire way to make money long-term. Even if the housing market dips, values appreciate over time, and few people who invest in real estate wind up selling at a loss in the long run.
An attractive side hustle
Millennials were the pioneers of the side hustle as a way of making extra money. At its core, this generation believes in working to live and not living to work. Therefore, they always look for ways to earn extra income from other sources instead of seeking jobs that require impossibly long hours.
Online real estate investment opportunities, such as crowdfunding, mean that millennials do not need to make their first foray into the real estate market an overwhelming one, such as purchasing a home individually. They use online investment opportunities to learn about the market before making such substantial commitments.