Even though home-ownership rates for the Millennial generation have now passed 50 percent nationally, the Washington region is among pricey locales where the figures are trailing.
And, according to a new survey, many of those in the generation born roughly between 1980 and 1998 who do not currently a home do not expect to ever own one.
“Over time, millennial renters have become more likely to say they will rent forever, almost doubling from 13 percent in 2010 to 24 percent in 2022,” said analysts with Apartment List, which commissioned the survey.
“The large jump in ‘forever renters’ between 2019 and 2020 shows the immediate impact of the pandemic, when an already-challenging housing market reached a new level of unaffordability,” the analysts noted.
(Many Millennials aren’t doing much to help themselves enter the homeowner ranks; two-thirds of respondents said they had saved absolutely no money to put toward a down payment.)
Washington’s home-ownership rate among Millennials stands at 45 percent compared to the national average of 51.5 percent, according to the data. Millennials trail Generation X (69.7 percent of whom own homes), while both Baby Boomers and the Silent Generation that preceded them each have rates of more than 75 percent.
Led by the Grand Rapids, Mich., metro area, where 63 percent of Millennials own their homes, the markets with the highest rates are concentrated in the Midwest and Great Lakes regions, which offered some of the country’s lowest cost of living and highest residential vacancy rates (at least before the pandemic shook up the housing market).
Expensive coastal markets dominate the other end of the spectrum. California is home to the four metros with the lowest millennial homeownership rates: Los Angeles (27%), San Jose (31%), San Francisco (33%) and San Diego (34%). The New York City metro comes in fifth, also at 34 percent.
Notoriously pricey coastal markets like Miami, Portland, Seattle and Boston also find themselves towards the bottom of the list. Despite offering relatively high incomes, these regions remain unaffordable to a majority of Millennials, the analysts noted.
The pandemic drove an even deeper wedge between Millennial homeowners and Millennial renters, the analysis revealed.
On one hand, Millennials purchased an outsized share of homes during the first two years of the pandemic, when mortgage rates fell below 3 percent. On the other hand, housing inventory dropped to all-time lows and for-sale prices skyrocketed more than 40 percent.
For Millennial renters who could not afford to buy a home in the earliest stages of the pandemic, home-ownership opportunities waned dramatically in the years that followed. Mortgage rates spiked, pushing monthly ownership costs even higher.
What has resulted is a starkly bifurcated generation, where more than half of Millennials have achieved home-ownership and the remaining renters are finding it increasingly out of reach.
Millennials have had the slowest transition from renters to homeowners. By age 30, 42 percent of Millennials owned their homes, compared to 48 percent of Gen Xers, 51 percent of Baby Boomers, and nearly 60 percent of Silents.
