About 75% of first time homebuyers would prefer skip their starter home in order to obtain more long-term options, according to Bank of America’s Homebuyer Insights Report.
Here is a breakdown of what first time homebuyers prefer:
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Source: Bank of America
Of these first time homebuyers, about 35% said they would like to retire in their first home purchase, according to the report. About 69% would prefer to wait and move into a nicer home in the future, as opposed to the 31% who would like to move into a starter home now.
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Source: Bank of America
On the other hand, buyers who have a plan in place are more likely to purchase a starter home, as opposed to buyers who want a home someday, but have not solidified when. Among buyers with a plan already in place, 41% would prefer to buy a starter home, however 23% of buyers without a plan would buy a starter home now.
Of the reasons given for not purchasing a home, 56% said they don’t think they can afford the type of home they want, 34% said they are paying off debt and 28% said they don’t need a home yet.
The study showed that more Gen Xers have put off purchasing their home than Millennials because of debt. Whereas 32% of Millenials, aged 18 to 34, have put off buying a home due to debt, about 43% of Gen Xers, aged 35 to 49, have postponed due to debt.
The Bank of America Homebuyer Insights Report also showed that it's a good time to buy a home, but no one cares.
