With Homeownership Out of Reach for Many, Millennials Explore Co-Buying

With buyers are seeking smaller mortgages, and "house hacking" quickly becoming the new norm, Pairadime conducted a survey of 1000 millennials in the US around their outlook on home buying, with the results revealing more millennials are looking for smart solutions to achieve their home ownership dreams.

The average purchase mortgage request has shrunk by 10% since March, —to $413,500— as demand has picked up for FHA, VA, and USDA purchase loans favored by many entry-level buyers. Co-Buying has also gained popularity in the past few years, but with housing prices at an all-time high, and a recession looming, the profile of today's average homebuyer has drastically changed.

Historically, people who purchased homes were married couples and single people. Meanwhile, with marriage rates declining, home prices out of reach, and interest rates increasing, there hasn't been a solution to address the new norm as homebuyer sentiment continues to change. According to Pairadime recent study, the survey only 4% of millennials say they are waiting to buy until they get married to purchase.

According to a recent Zillow survey, half of new homebuyers said the process "left them in tears," with Gen Zers and Millennials "far more likely to cry at least once during their home-buying journey.According to Pairadime's findings, 36% would be willing to surrender their independence and move home to save money for their dream home. And those who did buy a home with an unmarried romantic partner and then broke up, realized they had no legal recourse and went through a "Millennial Divorce".

The value Pairadime provides to prospective home buyers includes:

• Finding compatible co-buyers
• Creating clarity and building consensus across the group
• Protecting finances and relationships through legal agreements
• Connecting with a co-buying certified real estate agent
• Pairing with an experienced co-buying mortgage specialist

Despite such hurdles, Millennials aren't the freeloaders they are perceived to be. While recent reports suggest that financial help from parents or close relatives has been the only source of saving grace for many when it comes to buying a home. Pairadime's study revealed that 2.5x more millennials said they would prefer to receive financial assistance from their parents as a co-investment rather than a gift —51% versus 21%.

While many Millennials aren't looking for a handout from their parents, 45% said they are looking for a real estate agent who is experienced in co-buying to help them through the process, while 36% say they would co-buy with someone they weren't married to if it meant they could get a bigger mortgage. When it comes to who Millennials are willing to live with, 60% say they would prefer to co-buy with a family member, friend, or a person they matched with from an open marketplace, —compared to only 25% who said they would prefer to work with a corporation who took equity in exchange for financial assistance.

To read the full report, including more details on co-buying and tips from Pairadime, click here.