The One Obstacle Preventing Millennials from Homeownership
A new study exposes some surprising trends in Millennial savings and attitudes towards ownership.
For all the noise about Millennials moving out to buy homes, new data released from Apartment List says they still may not be ready yet.
Apartment List surveyed 24,000 renters born between 1982 and 2004. It found that 80 percent of them want to buy a home. But saving the money for a down payment remains a huge obstacle, according to Apartment List’s Andrew Woo and Chris Salviati.
“68 percent of Millennials said they have saved less than $1,000 for a down payment,” Woo and Salviati wrote. “Almost half, or 44 percent, of Millennials said they have not saved anything for a down payment. Nearly the same amount, or 40 percent, said they aren’t saving for a down payment on a monthly basis. Only 15 percent have saved $5,000 or more, and only 29 percent are saving $200 or more each month.”
Those low rates of savings could conspire to keep Millennials out of home ownership for a while. The Apartment List survey found that Millennials in several large metros would need at least a decade to accumulate enough for a 20 percent down payment on a condo.
In 2014, when Apartment List last surveyed Millennials, 25 percent said they plan on purchasing a home within the next two years. In the most recent survey, which occurred between October 2016 through April 2017, only 16 percent of respondents said they plan to purchase a home within the next two years. In the 2014, 53 percent of respondents said they expected to wait three years or more to buy a home. In the most recent survey, that number jumped to 67 percent.