Chicago Tribune |
Mar 26, 2021 at 10:57 AM
Chanelle Bell is looking for a single-family home in the Beverly neighborhood after spending seven years in Hyde Park.
The native Californian said she’s looking to start a family within the next year, but she’s realized buying in her area is not feasible.
“That’s been really hard for me to really reconcile because I’ve never known living in Chicago, outside of this neighborhood, but I’m out-priced,” she said.
Bell, 28, is one of many millennials making moves toward homeownership earlier than planned due to the pandemic. And she’s not alone. According to a recent survey by St. Louis-based Clever Real Estate, an online platform that refers homebuyers and sellers to agents who charge less commission, 30% of millennials say COVID-10 pushed them to begin house hunting earlier than originally planned.
Chanelle Bell, 28, is seen in her home March 7, 2021, in the East Hyde Park neighborhood of Chicago. Bell, a millennial, is looking to buy her first home in the Beverly neighborhood. (Armando L. Sanchez / Chicago Tribune)
The survey of 1,000 people on Jan.15 also revealed:
Nick Libert, CEO and owner of Chicago-based Exit Strategy Realty, agrees with the findings. He said millennials have been a huge part of the market, as older clients move out of the area for retirement and millennials buy their homes — their first home or a move-up property.
Libert is helping Lakeview East resident Josh Green, 32, find his first home.
“They’re realizing they can afford a lot more than they could a year ago. They’re feeling more confident in their jobs than they were at the beginning of COVID and they have saved up money,” Libert said of millennials like Green. “It’s just a whole different dynamic than it was before.”
Green said he’s leaning into buying a home because it has to serve more purposes than it did before, including his newfound love of baking.
Josh Green, 32, left, looks at a remodeled junior one-bedroom condominium March 12, 2021, at the Park Place Tower in Chicago with real estate agent Nick Libert of Exit Realty. (Jose M. Osorio / Chicago Tribune)
“I’m just more sensitive to how my home needs to look and feel,” Green said. “Now my home has to be my office, sometimes my gym and sometimes my dance floor and sometimes my safe space for friends, so I need to accommodate many other facets of my life and more space is definitely necessary.”
Bell can relate. The pandemic changed a lot for her and her husband — from increasing their savings to reducing their credit card debt. Bell said they were able to save money more rapidly because repayment of her student loan debt was put on hold. The Education Department suspended federal student loan payments through Sept. 30.
President Joe Biden has expressed support for forgiving $10,000 in student loan debt per borrower. And earlier this month, Education Secretary Miguel Cardona announced a policy shift that forgives $1 billion in student loans for thousands of students who were scammed by for-profit institutions.
Chanelle Bell, 28, is seen March 7, 2021, in her home in the East Hyde Park neighborhood of Chicago. Bell, a millennial, is looking to buy her first home in the Beverly neighborhood. (Armando L. Sanchez / Chicago Tribune)
“It just seemed like possibly the perfect storm to take buying seriously,” Bell said. “But it is scary. Houses are selling super fast. That gives me a little bit of anxiety, of feeling like you have to make your first huge purchase like this super quick, in an unstable economy.
“We’re still moving forward with it, but it is stressful and trying to figure out is this the right gamble, is this the right risk to take? Do we just take a hold of the moment right now and potentially get a smaller house with what we have, or do we wait a year and be able to maybe buy a bigger house in a better neighborhood that we would be able to afford if you waited a year versus going with what we have now?”
Francesca Ortegren a data scientist at Clever Real Estate, said Bell’s anxiousness is not uncommon. The pandemic marks the second big economic disaster that millennials have been through since graduating college, the first being the 2008 recession.
Josh Green, 32, left, tours a remodeled junior one-bedroom condominium at the Park Place Tower with real estate agent Nick Libert on March 12, 2021. (Jose M. Osorio / Chicago Tribune)
To be sure, homeownership is out of reach for some millennials. But others are taking the plunge and the fact that some millennials are willing to buy a home sight unseen or solely looking at online pictures was a bit surprising, Ortegren said.
While Green and Bell said buying a home without seeing it first was beyond their comfort threshold, Ortegren links the higher number of sight unseen first-time homebuyers to the switch from a buyer’s market to a seller’s one.
“After a year dealing with these lockdowns and navigating and existing in this space, I think people are a little bit more comfortable buying and selling right now,” she said.
The percentage of millennials who are buying because interest rates are low or who said that was a motivator was about 40% this year, compared with 11% last year.
“We also saw some changes in what millennials are looking for in a home,” Ortegren said. “We found that about 30% of millennials who live in an urban area right now are looking to relocate to the suburbs. Thirty percent is pretty significant when we think about how many millennials live in urban areas right now.”