Millennials don’t fully understand what they’re in for from a cost-perspective when buying a home, nor do they do much searching or comparison when it comes to choosing a real estate agent, according to an online study from Nobul Corporation.
Nobul is a digital marketplace that connects home buyers and sellers with more than 400,000 real estate agents for free.
For this study, it surveyed more than 400 millennials who are part of the Angus Reid Forum between Sept. 12 and Oct. 2, including those who plan on buying a home within the next two years, and current homeowners who used a real estate agent to buy their home.
The study revealed some concerning findings:
- 75% of millennial homeowners went with the first real estate agent they met. “This stat is put into context when you consider that the average millennial Netflix user browses 10-20 titles before making a selection,” Nobul’s news release reads.
- 38% of millennials looking to buy a home “know nothing, or very little,” about the average commission their real estate agent will collect when they’re looking to buy or sell.
- One third of millennials looking to buy a home said that housing prices are affordable in the area they plan to live in (the specific areas weren’t revealed). But Nobul says, this confidence is “despite the average bungalow costing $521,250 nationally and an average millennial after-tax household income of $44,093.”
“The study clearly shows that while millennials value home ownership, with many planning to purchase soon, they don't completely understand the costs,” Regan McGee, CEO of Nobul, said in the release.
“Industry stakeholders need to take more responsibility in creating transparency in real estate transactions, especially as it relates to the costs associated with buying and selling a home.”
Buying a home comes with all kinds of extra costs, such as home insurance, land transfer taxes, appraisal fees, and title insurance, that many don’t think about until the closing process actually gets underway.
“Study findings suggest research is poorly lacking,” the release states, “and that while many millennials have confidence in the process of buying or selling a home, they don't fully understand all of the costs which could result in regret and disappointment in what will likely be one of the largest purchases they ever make.”