Renters in this market won’t have a down payment for 35 years

by Steve Randall16 Jul 2018

College leavers in some US housing markets may just have saved enough to buy their first home by the time they retire!

The hottest housing markets – including California’s San Jose and Los Angeles – have prices so far outpacing average incomes that it would take renters more than 35 years to save a 20% down payment for a median value home.

And that assumes that wage rises tracked home price appreciation, which has not been the case for years. It also relies on renters saving 20% of their monthly pay cheque, which isn’t easy in markets where rents can swallow up 55% of income.

An analysis from HotPads shows that the average renter in the US faces six years of saving for a down payment with Detroit, Cleveland, and Indianapolis providing the shortest wait to become a first-time buyer at around 4 years.

"Home prices are outpacing incomes in many of the country's largest markets, which makes saving for a home more difficult. On top of that, the current generation of first-time buyers is dealing with unprecedented levels of student debt, making the down payment a major factor keeping young renters out of the housing market even though many young people say they have ambitions to buy,” commented HotPods economist Joshua Clark.


More market update:

Industry news

Submit a press release

Poll

Do you do commercial deals?