MILLENNIAL HOMEBUYERS CONTINUE TO MIGRATE INLAND

Millennial First Time Home Buyers

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Millennials continue to make their way inland in search of affordable housing, with Minneapolis, Minn. experiencing the most millennial home-buying activity this fall, according to October data from Ellie Maes Millennial Tracker, a measure of millennial mortgage applications. Based on the data, Philadelphia, Pa., St. Louis, Mo., Chicago, Ill., and Detroit, Mich., comprised the top five cities for millennial homebuyers in October.

"As housing prices continue to rebound, millennials are increasingly representing a higher percentage of homeowners in the middle of the country," said Joe Tyrrell, executive vice president of Corporate Strategy at Ellie Mae, in a statement.

Millennial borrowers FICO credit scores, on average, were 722, according to the data. The Midwest has shown marked improvement in credit overall, more so than any other region in the country.  Millennial homebuyers, especially in the Midwest, are also affording more than they were just six months ago, with the average appraised value up from $212,939 in June to $223,153 in October.  Profiling millennial homebuyers, the Tracker shows approximately half of millennial borrowers, with an average age of 28.7, were single and half were married-a near-even split that underscores the growing trend toward single homeownership. 

Millennial men, however, were more likely than millennial women to be the primary borrower.
More than three-quarters of closed loans for millennials were purchases, while 22 percent were refinances, according to the data. The average loan amount was $184,733.

California and Florida experienced the least millennial home-buying activity this fall, with the Miami, Los Angeles, San Francisco, San Diego and Tampa-St. Petersburg metropolitan areas comprising the top five on the other end of the spectrum.
Source: Ellie Mae

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SURVEY: SAVING A TOP PRIORITY FOR MILLENNIALS, BUT IMPULSE SPENDING A MAJOR BARRIER

One in three millennials (34 percent) ranked saving as their No. 1 goal for the year - ahead of living a healthy lifestyle (20 percent), paying off debt (19 percent), and losing weight (14 percent). But while saving was a top priority, a majority of millennials attributed their lack of saving to impulse buying (65 percent).

According to a recent survey from the American Institute of Certified Public Accountants (AICPA) and the Ad Council, for older millennials - those born between the early 1980s and early 1990s - saving is crucial as they work toward major milestones in their lives. When asked what they were saving money toward, respondents sought to secure their future by saving for an emergency fund (40 percent), saving for retirement (22 percent) or starting a family (15 percent). They also reported saving for larger purchases like a vacation (36 percent), a new house (27 percent), a car (26 percent), home improvements (20 percent), or a wedding (8 percent).

To provide Americans aged 25 to 34 with the tips and tools to take control of their personal finances, AICPA and the Ad Council's national advertising campaign, Feed the Pig, is continuing to collaborate with new partners to deliver this critical content in a relevant and engaging way.

"Many young adults think saving is impossible," says Gregory Anton, CPA, CGMA, chair of the AICPA's National CPA Financial Literacy Commission. "While low salaries and high debt levels can certainly be barriers to saving, the key is to create a budget and stick to it. Establishing a disciplined saving strategy early in life and avoiding missteps will reap substantial long-term dividends."

In addition to impulse buying and lack of budgeting, an overwhelming majority of young adults say that their current salary (84 percent), having too many bills (81 percent), paying down debt (79 percent) and not establishing a personal budget (62 percent) are impediments to saving more. Regardless of the reason, almost half (44 percent) of those surveyed did not pay their full credit card balance each month or borrowed money from friends or family. Forty-one percent had less than $100 in their checking account, 30 percent paid a late or overdraft fee, and 23 percent missed a bill payment.

Over half (55 percent) of the young adults surveyed admitted that they were impulse shoppers, defined as making an unplanned purchase of $30 or more on a daily or weekly basis. Impulse buyers are more likely than those who never or rarely make an impulse purchase to have carried a balance on their credit card (45 percent vs. 35 percent) and have paid a late or overdraft fee (31 percent vs. 21 percent).

The Internet is viewed as a positive by millennials as an overwhelming majority (92 percent) agree that it has made it easier to get the best deal and 88 percent agree that they comparison shop for the lowest price before making a purchase. However, approximately one in four (28 percent) have seen a big ticket item they purchased for a lower price than they paid in the past year - underscoring the importance of being diligent when shopping for big ticket purchases.

"The good news is that millennials are internalizing the message that saving is important, but they still need help creating habits that stick," says Ad Council President and CEO Lisa Sherman. "We're excited to collaborate with partners like Facebook and Games for Change to create new tools and content that will help make saving easier and more accessible for millennials."

The Feed the Pig website offers a range of interactive tools, including calculators, podcasts and free subscriptions to weekly saving tips via email and text message to help foster positive saving habits.

To date, the Feed the Pig campaign has received more than $382 million in donated media through the Ad Council's model. The CPA profession launched a unified financial literacy initiative, 360 Degrees of Financial Literacy, 12 years ago. The effort brought together the AICPA, state CPA societies, and individual CPAs to address financial illiteracy.

Source: AICPA; The Ad Council

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