The Bellingham Real Estate Podcast
The Bellingham Real Estate Podcast
EP: 0048 - From Renting to Owning: Gen Z's Path Home Ownership with Irena Kolbert
Generational trends highlight the pressing challenges facing Gen Z in homeownership, with only 3-4% of all homeowners represented by this Generation. John L. Scott Real Estate broker Irena Kolbert shares her story of financial discipline, sacrifices made during early career years, and essential tips such as consulting lenders and maintaining the right mindset to achieve homeownership dreams.
• Defining Gen Z and discussing homeownership statistics
• Challenges faced by Gen Z in the housing market
• Personal sacrifices made for saving money
• Importance of mindset in achieving financial goals
• Need for open conversations with lenders and real estate agents
• Strategies for future home purchases and leveraging opportunities
You can reach Irena at irenakolbert@johnlscott.com.
Hello and welcome to the Ballynam Real Estate Podcast. I'm Paul Balzatti. I'm here with Irina. Welcome, Irina.
Speaker 2:Hello, hello, thanks for having me.
Speaker 1:You absolutely, and so this is your second time on the podcast. It is yeah, yeah, which I'm excited to have you on again. And today we are talking about Gen Z, because you're Gen Z, I know Well seriously, though, and we're talking about Gen Z and kind of a little bit about Gen Z and their homeownership rates and challenges and getting into homeownership and everything like that, and so we'll get right into it. So, first off, I mean, how old are you?
Speaker 2:So I'm 26.
Speaker 1:You're 26. And so, and you've been in real estate now for Four years Four years, yeah. And what was really cool about when you were getting going, starting your career, is you actually started in property management, which was and that's what we talked about last time is property management. Is you started in property management at a young age so that you kind of had that experience going into real estate? And so now you have property management experience and now almost four years now in real estate and sales as well, so very experienced, and you also own what two homes.
Speaker 2:Yeah.
Speaker 1:Two homes, so a good person to talk to about Gen Z and how to help Gen Z make it happen. So first off, let's define, if you want to, about Gen Z and how to help Gen Z make it happen. So, first off, let's define, if you want to define Gen Z for everybody.
Speaker 2:Yeah, so Gen Z is basically as of 2025, you're looking at the folks that are 13 years old up to 28 years old. So I'm right at the end there being 26. And then my husband's 25. So we're both Gen Zers and when it comes to the years, I think it's actually 1997 through it was 2012. So you're looking at anybody between 13 and 28. But I think that, with being 26, it's kind of a mixed feeling. I feel like I'm more of like the older generation, but I'm actually Gen Z. But I had a little bit of the best of both worlds, with a mixture of people in my life who are able to guide me into homeownership.
Speaker 1:Yeah, and do you want to share any statistics about Gen Z?
Speaker 2:Yeah, I mean, when it comes to Gen Z, it's really unfortunate for my group of folks, but we only make up three to 4% of homeowners here, so it's a very small puddle, but on the good side we are 26%, I like how you change it from a pool to a puddle. Pool to a puddle. Yeah Well, same thing Potato, potato right?
Speaker 1:Well, it's only three to 4%. It is kind of a puddle, you're right.
Speaker 2:It is a puddle, more like a drop at that point, um. But on the positive side, um, it looks like 26% of Gen Zers do still have of adults of adults. Yes, because you can't buy a house at 13. I mean, ideally you shouldn't be doing that so they must be.
Speaker 1:If it's adults, it must be 21 to 28.
Speaker 2:I'd imagine 21, 27, something like that I mean legally, you're allowed to buy a house at 18, right? So?
Speaker 2:yeah, that group that's 18 to 27, right 26 percent yeah, so 26 percent of those folks between 18 and 28 own a house, which is great. That's a really good stat. However, if you look at the overall picture of who actually does own a house, we only make up three to 4% of homeowners, which is unfortunate, but it's okay. Hopefully that number grows. You know, especially after this podcast, I would love to see that number grow, if we could get it from 3.5 to 3.6,.
Speaker 1:You know just that little, every little bit counts. Every, every individual family that you can get into homeownership, because we know that. Um, you know, wealth grows, the individual wealth grows with homeownership. The difference between your net worth when you're a homeowner versus not, over your lifespan is massive, and so the sooner you can get in, just like the sooner you can set up a retirement account, obviously the better, right. So you've managed to. You and your husband have managed to buy a home and then buy a second home, so you guys own two homes. So what would you? I mean? There's obvious ways to identify the challenges when you're younger, as far as you know, you have to have a good job, you've got to save money. What are some of the challenges? What are some of the challenges? What are some of the general challenges and like, and then for you, how did you guys do what you did at an early age? Like, what was? I mean? What was your? What was your story on how you guys pulled it off?
Speaker 2:yeah. So it was not easy. I will say that we both, like my husband and I we both come from very low-income families. So when it comes to buying a house and being financially capable of buying a house, we were able to lean on our parents for that, which was really unfortunate. I do know some folks who can do that, which is great, but for us we really had to just figure it out ourselves. Both of our parents are immigrants as well, so they don't really know much about buying houses or like the whole process with getting a home loan, none of that. So we really had to do our own, you know, research and saving. But what we did that really helped us was making sacrifices.
Speaker 2:So for a whole year after we got married, we made so many sacrifices just to save money. So we didn't buy any like luxury bags, we didn't go on vacations, we didn't eat out like that. Like for a girl, like I couldn't get my hair done, I couldn't get my lashes done or my nails done None of that. Like I cannot do anything. I rather save money and just, you know, just put in your bank account and after a year I was able to save up our down payment, which was really nice.
Speaker 2:However, it's not just a down payment that you have to save up for. You have to also save up for closing costs and all those little miscellaneous things. So what we did was, at the end of our lease when we were renting an apartment, we actually moved out of our apartment three months early and we lived with my mom and dad, which was hard, as you can imagine. But, again, sacrifices. You have to make those sacrifices just to save up money, and we did. After that, one year, we got all that money finally saved up. We were able to buy our first house and it was amazing.
Speaker 1:It was such a stress-free process at that point because we had everything there and it was just a matter of finding the right home. And but, by the way, we didn't talk about this before, but did you guys follow the dave ramsey program?
Speaker 2:yeah, that's who it sounded like.
Speaker 1:It sounds like a dave ramsey program, because that's you know I. I was thinking in my head rice and beans, rice and beans. Have you ever listened to Dave Ramsey? And if somebody hasn't listened to the Ramsey program. What ramen as well yeah, I mean, you see, melrop is there um, ramen.
Speaker 2:So he used to always talk about like, when you're saving up money, you're supposed to eat, like the rice and beans, and then you're also supposed to eat ramen, but you're talking about ramen yeah sorry, I think he said Robin Robin ramen.
Speaker 1:Yeah, um, but's, yeah, that's something they talk about and you're so. You did all those things. So you literally were not eating out, you were not getting your hair done as much, you weren't going on vacation. You had a full year of just like. Let's just stash money away and including let's even move in with our parents for a little bit.
Speaker 2:And it was actually nice for us. By the way, we were known as DINKS, which is D-I-N-K-S, so dual income, no kids that's what people call us. So we had dual income, no kids. It was super easy to save up for our situation. I do know some Gen Zers who do have kids and it kind of sets you back financially when it comes to saving up, but it's not impossible and I still want to encourage those people that you know do have kids. They still can, in fact, buy a house. It's just for our situation to kind of sped things up when we're dual income, no kids. That really helped out for sure.
Speaker 1:That's an important distinction though. That did it. It did clearly. It did clearly help. So but I think the reason why that's important to still bring up is, yeah, if you have kids, maybe it's a two-year runway instead of a one-year runway to save all that money, because you can't save at the same rate. But if you're a Gen Z-er and you haven't had kids yet but let's say you're in a partnership or you're not, or whatever, but you want to have kids eventually, well that's a good reminder that, hey, it's much easier to save before you took that step.
Speaker 2:So, and to make those sacrifices, and I do like how you said that with you know no kids, it's usually about a year, and then with kids, it's two years. That is actually exactly what happened to my husband and I. The first house that we bought took us a year to save for it, but then, right when we bought the house, we ended up having our first child and since you now have a kid, it did take us two years to buy the second house.
Speaker 2:It was exactly two years. Well, I think it was like a less than 30 day difference, but almost two year difference, so twice as long to save up, but it was so worth it.
Speaker 1:You know, it's still possible even with having kids, so Well and what's really impressive about what you did and what you guys did which is something that should be hopefully inspirational to others which is something that should be hopefully inspirational to others is you did what is even difficult for any generation to do, which is you bought a home and then normally most people they take that first home, which you did. You bought a home that was um, it was a newer build but needed some work, but it needed some work and so you bought something that was like a light fixer. That, you know, was something that you could, you could, live in, but you knew that cosmetically you could improve it to be better and it's nicer. A lot of people move into that home for three to five years and then sell it to get into the next home and kind of, instead of saving, saving, saving more and more and more to buy the next one, they let their equity build essentially over, which is nothing wrong with that process.
Speaker 1:That's what most people do you just like, went ahead and you guys just save more money so that you could keep that house as a rental, which is even more impressive. So now you have a rental and you have a new home. That's nicer that you upgraded to.
Speaker 2:So it sounds very straightforward, but the process was a lot more complex. When we bought the house, it was moving ready, like you said, but it could have taken, you know, some cosmetic updates here and there, you know. So what we did was we ended up doing those cosmetic updates. We got the new countertops, new cabinets, flooring, all that it was about 30 to 40 grand into the house, just making it look prettier. And then at that point we saved up for those two years for the second house.
Speaker 2:But while we were saving for those two years, we were fixing the house, making it look pretty and, being in property management for a couple of years prior to real estate, I knew the market for rentals at the time, and so I was keeping that in the back of my head like, hey, what are we going to rent out the house for and what is our mortgage payment? Is it going to make sense to rent it out or is it more appropriate to sell it? So our goal is to break even on our rental. You know, just get rental income that covers our mortgage. That was our goal. That way, at least, it makes sense to keep the house, because if you're not breaking even, you're losing money and it's kind of scary to do that.
Speaker 2:So we ended up figuring out a way to get the rental income to match our mortgage payments. So, and that's fine for us, we are more than happy with that because we want to hold the property and it's going to build equity, which it has been. It's probably, I think, think, I want to say like $150,000 worth of equity as of today, and so we were able to buy our second house without touching that equity, by the way, which is super, super. I'm super thankful for that. It's still there, it's sitting there. But we ended up buying that second house and, yeah, we're just going to do the same thing with the next house, and just every two years.
Speaker 1:You know, buy, not flip, but make it cute, buy make it cute, buy, make it pretty and then rent it out, go to the next one every two years. What's great about then, when you pull that off is, with rentals, your mortgage payment is relatively fixed. Yeah, property taxes, insurance can go up a little bit every year, but rental rates on average tend to go up faster than your mortgage payment ever would, because your actual principal and interest payment are not going down If anything. Over time, if rates go down, you're actually going to refinance into a lower payment. Yet every few years you know you'll be able to actually raise the rent just with inflation.
Speaker 1:And so if you can pull off, a lot of people keep their places of rental and even feed it a little bit. But if you're able to pull that off where you can get the rent to match your mortgage, then over time it does turn into a cash flow property as either with higher rent or refinancing into lower rates. So that's a really, really fabulous thing that you're pulling off. As far as if you are talking to a Gen Zer, if we have anybody listening or watching that is sending this to a Gen Zer in their life or is listening and is in that spot, and they just are like, okay, yeah, I got to make sacrifices. Tip number one was clearly your story, which is the rice and beans for a year, moving out with the parents, the making the sacrifices to save the money. Um, beyond starting to stash away cash and make those sacrifices, what other tips do you have for those people that are trying to get into a home?
Speaker 2:Yeah. So it's all about your mindset. It truly is about the mindset. So if you are focused on trying to buy a house and if you are in a situation where it's going to take a little bit longer to save money because you don't have a family to move in with or you don't have family to help you with your down payment, and if it's truly up to you, then you need to change your mindset. You have to convince yourself that you're broke, you can't do anything, you can't buy anything. You have to just convince yourself that you're broke temporarily, just for the sake of saving up money.
Speaker 2:And then it usually works, as what we did I remember, especially with our family. They would invite us all the time to, like you know, some family gatherings, birthday parties, whatever it was, and we would always say, sorry, not, not this year, we're broke. You know in our head like we're not going to be able to afford it. So and of course we were able to. But we made it clear to our family and friends. We're like, hey, guys, we're trying to, we're trying to save up. We can't just for this year, next year, sure.
Speaker 2:So once your mindset changes and you convince yourself that you are in a position where you have to make those sacrifices for the sake of a down payment and buying a house. It's going to be worth it, I promise it's going to be worth it, but it's going to be hard for that first year, up to even two years, like you said. If you have kids, it could take a little bit longer, but it's always worth it. So my biggest advice change your mindset and then always, always, just keep in mind at the end of the day, that this is temporary.
Speaker 2:You're going to make those sacrifices temporarily and in the next year or two, it's going to be the best decision that you'll make, because you'll be walking home to your own house that you own. It's not going to be a rental, it's not your parents' house, it's your own house. It's your safe space. And then you'll look back to those days where you had to, you know, drink water and eat ramen on your, you know, on your floor for a couple of weeks, just to make ends meet. You're going to look at those days and you're going to laugh. You can be like, okay, it was worth it, it was worth it.
Speaker 1:Yeah, that's a. That's a really kind of uh, interesting way to look at it. I like that because I mean, I know, um, this is not completely related, but, um, you know, when I first got into real estate, you know, with our business, you have this situation where you know we're commission based and there could be people out there that are in commission sales, you know, that are trying to, you know, build up money too. And it's like. You know, I was on pace my first few years to make X amount of money. But I kept trying to convince myself okay, I have to live like I'm only going to make this much money and even if and then any additional sales is just going to be bonus. Yeah, and you know it's just essentially budgeting. But even if you don't feel like you're good at budgeting, if you create this mindset like I got to live off this amount of money because in anything extra is going to go here, it really is. Even if you're not really good at you going, I'm only going to break out the Excel sheet or whatever.
Speaker 1:Quickbooks well, they wouldn't use. Well, I guess they'd use QuickBooks online. No one would. I don't know if people Do you write anything down these days, or you just do everything on your computer, right?
Speaker 2:Writing down for the sake of goals and stuff. Yeah, I mean, we actually do that. Only actually, specifically, my husband and I were very good at keeping everything in writing when it goes to our goals, cause you will forget you will forget your goals if you don't write them down.
Speaker 1:So it's like, yeah, so it's like, whatever methodology you use for saving, you know, you do like write it out and say, okay, this is how much I'm pulling in right now, or how much I could make this year, and here's how much I got to live off of, but then, beyond that, okay, so now I'm saving the money. What are the next steps? Because you know, obviously there's also somebody, somebody could be making enough money right now and they may not even realize that they qualify for a home right now, or maybe they, maybe they the program they're going to use doesn't necessarily require, um, a huge amount down. So, like, what are the other steps that they could take?
Speaker 2:You know, that's a great question and, um, I actually want to specify that this, the answer to that question, is going to be the biggest reason why people in the Gen Z group will become homeowners. And the answer to that question is talk to a lender. Talk to a lender, do not be scared of them. Um, I know that a lot of people, especially you know, in the Gen Z little puddle, like we said, we are very, very scared of talking to lenders and real estate agents. They feel like there's going to be some sort of, like you know, hidden strings attached to that conversation. There could be with, depending on who you're talking to, but I have connections to lenders who are not going to have that pushy, like you know, having some strings attached to your conversation vibe. They will genuinely just inform you and educate you and that's the end of it. So talking to a lender is going to be the biggest reason why people get into homeownership. And that's also why I truly feel like we were ahead of the game, my husband and I, because when I was 19 years old, I got accepted to Western and I remember that feeling like, yay, I'm going to Western, I'm going to get my bachelor's.
Speaker 2:It's going to take exactly two years to get it. What's the next step after graduation? And I sat in my room that day and I was like, ok, what is going to happen after I graduate? Do I just get a job? And that's it. Like what, if, what if I want to buy a house, like all these thoughts started to rush in.
Speaker 2:So I took a really bold move and I made this really bold move to just call a lender that I know and he's actually still in the field to this day. But I ended up calling him and I'm like hey, I, I'm 19 years old, I just got accepted to Western and I'm going to be there full time for two years. I want to buy a house. What, like how? How is that going to help me? Should I even go to college? Is that going to set me back? I really want to become a homeowner. And the thing that he told me that day blew my mind. I had never known this, but he told me that you can actually get pre-qualified for a home loan based off of that two years of college. As long as you're full-time the entire two years, it can actually qualify you for a home loan.
Speaker 1:It can help. It can help qualify you.
Speaker 2:Right, because usually you need two years of like work experience to get qualified. In this case, as long as you go to school for two years full time and then you get a job right afterwards within like a couple of weeks that's, in the same field of the education that you just got you can get pre-qualified, and that's exactly what I did. So I went full time for those two years, got my bachelor's it was a bachelor's in business, so I ended up getting a business position right after college. Like two or three weeks I had a job Property management.
Speaker 2:Property management, yep, and it's a manager position, right. So, same field and within a month, I want to say, of working there. I was pre-approved.
Speaker 1:That is a really good insight.
Speaker 2:And I would have never known that had I just not called the lender that one day when I was 19 years old. Like who would have known?
Speaker 1:That's so good and so, yeah, when you talk to a lender, not only do they educate you on those programs and opportunities, but they also run the math for you. All these different ways, these different ways. And if you're just using a mortgage calculator at home, that can be really debilitating because it's not giving you all of the information. Um, and then it depends on the loan officer. So if you go to one loan officer and they don't seem to give you clear answers or give you a pathway that seems feasible, then you should talk to another loan officer, because you know you talk to the right ones. And there are certain loan officers who really do specialize more in working with first-time homebuyers and, um, and have and lenders that have more programs available.
Speaker 1:Um, you know, there's state bond programs, there's things that might money that might be available, um down payment assistance down payment, assistant programs that might be available for you, and so those are some of the big things also that you have to, you know, be aware of.
Speaker 2:And the thing is exactly when it comes to like the first time home buyer situation, you have to just keep in mind at the end of the day, if you talk to a lender, you will know all of your options, but you have to just simply take that leap of faith and talk to a lender. They will not only tell you all these like first-time homebuyer programs that are available for you, but they will also tell you, like what they told me, which is, hey, you want to go to college right after you graduate. You can get pre-approved within like a month of graduating. Like I would have never known that had I just not called that lender. It's not that serious of a conversation. I promise it's not like any strings attached, it's just educational purposes. Only just call a lender, get some. They will inform you about what your options are and it will be the best decision you'll ever make.
Speaker 1:Yeah, absolutely, and I think that also the realtor you talk to, like obviously if you're in Bellingham, you obviously want to talk to you, you know, in another part of the country and you happen to listen to this or another part of the state, you know, not all realtors are like, let's say, you only qualify for this kind of lower price range where it's more challenging, you know, unfortunately there's realtors who kind of don't necessarily give you the energy and time that you need as well.
Speaker 1:So it's also important to have a good lender. But also not all realtors are created equal either. Where there's realtors that will really put the time in, because sometimes when you're at those really tough price ranges, which most Gen Zs will be, they're going to be in that low to median price range area where you need to find kind of a good deal and those deals can emerge even in a hotter low inventory market. But it's just a little bit more of a grind and more of a patience and more of a process and it can take time, like to for those deals to emerge or for you to, you know, get the listing, like maybe you write an offer and you get beat out because you need closing costs help and then you just have to keep going. And so you know it really is also having having a lender that helps you with the right programs, educates you, gets you going, but then also a realtor that's willing to be patient with you.
Speaker 2:Who actually understands your situation is because I actually I've been there so I understand how it feels and having a low, having a low budget it does, obviously it's. It's stressful for home. You know those home buyers who are trying to buy a house because that budget is very popular the 400 to 500 dollar, uh, 45,000, yeah, it's a really, really popular budget. Um, and so a lot of buyers are trying to get houses in that price range and I've been there, I've done that, um, and so it's not easy, but I have that experience, my firsthand experience with being in that price range in the first, you know, when I was buying my first house, so I can relate to first time home buyers. But also I am not I'm not exclusive to the people that I help. I work with everyone.
Speaker 2:I just recently sent a Sun Valley listing to one of my buyers. That was $9,000. Like, I listings a lot, it was a lot. Yes, it was a little tiny, small 0.2 acre lot in sun valley for 9 000, and then I'm over here doing 1.4 million dollar sales as well. Like it's, I don't have any sort of like restrictions on who I help. I want to help everyone because not only have I been there and I understand people that are in the like the lower budget but um higher budgets, like it does not matter, I don't care I want to just help, that's my goal cool, cool.
Speaker 1:I like it okay. Well, I think that, um, that was all really inspiring and helpful, irina, and I'm really proud of of your story so far and um, and thank you for sharing and thank you for all the advice and input here, and obviously you can reach out to Irina if you need anything. Thank you for watching or listening you guys cheers thank you for having me.