A new study has found the majority of Millennials are looking at homeownership as the primary strategy for building their investment portfolios. However, the study’s authors warn that approach might have greater costs than benefits.
According to the Bank of the West 2018 Millennial Study
, 56 percent of surveyed Millennials cited homeownership as the key to their financial endeavors. Following homeownership, 51 percent cited paying off debt and 49 percent cited having the financial means to retire comfortably as the second and third most important factors in their future.
However, the American Dream may not be entirely rosy for this youthful demographic. Sixty-eight percent of the study’s respondents admitted they had buyer's remorse after acquiring a home, adding they should have been more prepared going into the purchase. Forty-four percent had issues with space itself, while 41 percent said the purchase frayed their finances.
“The fact that nearly one in three millennials who already own their homes have dipped into their retirement nest eggs to finance their down payment is alarming,” said Ryan Bailey, head of the Retail Banking Group at Bank of the West. “A white picket fence can certainly be a smart investment. To help avoid buyer's remorse, millennials should consider covering their bases and kicking the proverbial tires—reflecting on their physical and financial wishes for their home before they sign on the dotted line.”
Still, all of the data is not gloomy. Four in 10 Millennials polled for the study are homeowners already, while 92 percent of the remaining respondents expressed interest in someday owning a home.