SALT LAKE CITY (ABC4) – A recent survey performed by Apartment List indicates that millennials are far behind other older generations as far as homeownership.
Here is what you need to know about how the housing crunch is impacting millennials in Utah specifically.
Apartment List’s survey indicates that only 48.6% of millennials own homes, which is 20% lower than Gen X and 30% lower than Baby Boomers. Even older Millennials who have reached 40 years old own fewer homes than previous generations; about 60% of 40-year-olds own homes.
Fewer and fewer millennials are expecting to own a home in their lifetime. Survey data shows that 22% of millennials say they will never own a home.
Apartment List provides some insight into why this is the case for millennials today. Their findings indicate that, contrary to popular belief, millennials don’t prefer the flexibility and short-term benefits of renting to homeownership. In fact, most millennials report affordability as their primary concern in making housing choices and would like to be homeowners at some point.
The survey data shows that as opposed to a preference for renting, millennials are not buying homes for more practical reasons. In short, down payment savings rates are very low among millennial workers. Only 16% of millennials report having savings over $12,000, and two-thirds of millennials report having no savings whatsoever.
Putting this data in a Utah context, even a $12,000 nest egg does not amount to much in our current housing market.
Millennials would need savings amounting to over $50,000 to afford a 20% down payment on a median-priced home in Utah. Faced with this daunting prospect in conjunction with high rent in Utah, many Millennials are simply giving up on the idea of homeownership.