When it comes to whether they can afford to buy a house in the pricey Golden State of California, millennial homebuyers are becoming more resourceful and innovative.
Afford To Buy A House In California Real estate
California real estate is notoriously expensive. In the Golden State, the cost of housing has risen to levels that are almost unaffordable. The Housing affordability of real estate continues to recede further from the reach of younger generations, despite the fact that demand for housing continues to decline and interest rates continue to rise.
Millennial homebuyers can scarcely stay aware of leases in significant urban communities like San Diego, Los Angeles, and San Francisco – not to mention start to put something aside for a downpayment on a house. Home values in California have skyrocketed over the past ten years and are showing few signs of slowing down. How are millennial homebuyers still ready to buy houses in CA?
Real Estate House Hacking Millennials are house hacking in California to offset a portion of their monthly mortgage payments.
In California, purchasing a single-family home with multiple rooms with the intention of renting out empty rooms is the most common method of house hacking. This additional rental income is being used by Millennials to cover some or all of their monthly mortgage payment. House hacking a single-family home is a great way to buy a home without breaking the bank for homeowners who are comfortable living with tenants.
Multi-family House Hacking
Not every person appreciates living with flatmates. Living alone may be less stressful, particularly when a roommate smells bad. In California, millennials are looking beyond single-family homes to learn about real estate and house-hacking multi-family buildings. A triplex, for instance, can be purchased by a homeowner who wants to live in one unit and rent the other two out. Rent from the other units can effectively offset a significant portion of housing costs in this way. Additionally, having privacy is a nice perk.
Building an ADU
Despite the fact that multi-family house hacking sounds ideal, such properties are more difficult to obtain. Millennial homebuyers are aiming for single-family homes on larger lots as a countermeasure. In California, homeowners can construct an ADU and rent it out in the backyard, subject to city and county regulations and property zoning. This is a great compromise for millennial homebuyers in California because single-family homes will be less expensive than multifamily ones, but they will still be able to enjoy a private residence while renting out the ADU.
Building an ADU can be done in many different ways, some of which are less expensive and can be used to get homeowners started. Rentals and apartments continue to be in high demand close to major cities like San Diego. Single renters looking for a small, private place to live are in high demand for ADUs. Millennials are successfully compensating for a portion of their monthly housing costs by house hacking with an ADU. In California, this is making it much easier to find affordable housing. When trying to buy their first homes and become homeowners, millennials continue to exercise their creative muscles.