[Editor’s note: as we strive to make personal finance more relatable this year, you’ll see more joint commentaries offering different takes on hot topics. We kick off 2019 with Millennial and Gen X takes on real estate. Below is Spencer’s Millennial take, and here’s Julian’s Gen X take.]
I’m basically a “Failure To Launch” millennial. I’m 26 and live with my parents.
Two of my younger siblings have moved out ahead of me. For most of my career, a third of my income has gone to student loans, and the fact that I’m bad with money on top of that hasn’t helped me. My creative, journalistic, and musical mentality basically make me the living embodiment of this Metallica lyric:
Oh, but I’ll take my time anywhere
Free to speak my mind anywhere
And I’ll redefine anywhere
Anywhere I roam
Where I lay my head is home, yeah
And while I never intend to shake this mentality because it’s needed out there and it serves me well in all professional pursuits, I am using this new year and my new position here at The Basis Point to start thinking more strategically about my long-term housing plans. Here are my New Year’s housing resolutions from a millennial.
My longer term goal is to own a home, but I want to identify the smaller goals that can get me closer to that goal in 2019.
1. Decide on renting versus buying. I know buying a house is the way to build wealth and saves me money in the long run, but going from my parent’s couch to home ownership right away seems like too big of a leap for me. I still have a lot of adulting to figure out how to do, after all.
2. Save, save save. I’m mentally scarred from paying a thousand bucks for student loans each month for over three years, so I want to put as much down on a house as I can to get the best monthly payment. I’m going to set a goal to save at least 10% of my income every month, and my savings account will eventually be the base of a down payment fund.
3. Figure out the right market conditions for me to enter. Zillow says that the median sale price for homes in the US has risen for 81 straight months. Since I’m in no position to get into the market in the near term, I’m going to have to wait for the macro winds to shift to really get into the market. Like I alluded to last week, a housing correction could create the right conditions for me to get a good deal and get into the market.
I’m laying myself bare here, so stay tuned to The Basis Point—and keep me accountable—as I move toward these goals. Happy new year.