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One of the top reasons the youngest millennials have put off homeownership longer than previous generations comes down to graduating in an economic recession with high student loan debt. Many see buying a home as too big of a commitment, financial and otherwise. But buying a home in your 20s is, in fact, attainable — it may even be a wise financial decision, depending on your circumstances and your goals.

If you're in your 20s and interested in homeownership, here are some tips for first-time homebuyers to keep in mind:

1. Rent Before You Buy

Spend time living in a rental to get a better sense of the kind of house you want to buy. Even if you only rent for a year, you'll come to know your likes and dislikes as well as any deal breakers. Maybe you envision yourself buying a big house now, but after 12 months of living in and maintaining a four-bedroom rental, you might realize a smaller home better suits your lifestyle.

Renting also gives you the benefit of trying out different parts of town. Getting to know the neighborhood (and the location of things like grocery stores or local restaurants) and what traffic is like in the area are factors you'll want to know before you invest in a long-term home.

Trying on different homes, so to speak, will give you clarity as you look at properties to buy.

2. Starter Home or Not?

In the past, young people purchased starter homes first, assuming they'd move into larger houses once they had higher incomes or as their families expanded. Recently that trend seems to have shifted, though. Now it's common for millennials to stay at home longer and save money so they can buy a larger, more expensive house right off the bat.

Consider both options and weigh the pros and cons for you. For example, if you stay at home and save money to skip a starter home, you won't have to worry about moving when your life changes. Alternatively, buying a starter home in a stable area can be a great investment as it could appreciate in value — potentially even providing the down payment for your larger, forever home down the line.

Take some time to consider which path sounds more appealing to you and your situation — there is no one size fits all solution.

3. Consider Your Financial Circumstances

Buying a home is a financial commitment, and not just because of the upfront expenses. Depending on the type of property you purchase, there are certain cost differences you should keep in mind. For example, a $200,000 condo might cost you more than a $200,000 single family home due to the monthly association fees. But, that extra cost might be worth it when you consider the benefits you'll be able to take advantage of (like a community pool or snow removal).

But even with the costs associated with buying a house, having your own home can be one of the best and most rewarding decisions you ever make. If you're able to make a down payment and you're confident in your ability to make your monthly payments, owning a home can provide a sense of stability and pride. For one thing, you don't have to think about renewing your lease every 12 months or scrambling to find new roommates once a year. You're also spared the stress of potential rent increases. Assuming you have a fixed-rate mortgage, you know exactly how much you'll owe each month for the duration of the loan.

4. Think About Where You Want to Live

Buying a home can be especially attractive if you plan to live in a given area for the foreseeable future. Maybe you anticipate being at your current job for several years or you want to put down roots near your family. Or, maybe you just really love your current location. However, if you expect to switch careers or you're considering traveling or relocating in the next several years, you may be better off renting until you're ready to commit to one location.

5. Organize Your Finances

To qualify for a mortgage, you'll need decent credit, a down payment, and a favorable debt-to-income ratio. Specific requirements vary by lender and loan type, but it's always a good idea to pay off any debts you can and make all payments on time. Some loan programs offer down payments as low as 0 percent, but the more money you can put down, the less you'll pay for the house over the duration of your mortgage. Investigate first-time homebuyer programs in your area, too. Some states and cities offer down payment and closing cost assistance, as well as homebuyer education courses. These resources make it more feasible to achieve homeownership in your 20s.

Talk With a Trusted Financial Advisor

There are many factors to consider if you're thinking about buying a house. You want to ensure that you're thinking holistically about your finances and that you can truly afford to buy a house. A fiduciary financial advisor can guide you through the decision and help you understand what you can comfortably pay for a house while leaving enough money available to cover taxes, maintenance, and other expenses. Head to your local KeyBank branch for a financial wellness review or schedule an appointment with a Mortgage Loan Officer to talk about your financial readiness to buy a house. Ideally, your property should enhance your financial stability, not jeopardize it.

If you're considering becoming a homeowner, know that you're embarking on an exciting and worthwhile journey. These tips for first-time homebuyers should help you think through the decision, but don't discount your own instincts. As your professional and personal life stabilizes, you'll know when it's time to create a permanent place for yourself.

This material is presented for informational purposes only and should not be construed as individual tax or financial advice. KeyBank does not provide legal advice.

By selecting any external link on, you will leave the KeyBank website and jump to an unaffiliated third-party website that may offer a different privacy policy and level of security. The third-party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend or guarantee any product or service available on that entity's website.

NOTICE: This is not a commitment to lend or extend credit. Conditions and restrictions may apply. Information and offers are subject to change without notice. All loans are subject to credit and collateral approval. Not all loans or products are available in all states.

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