#Young #Renters #Disadvantage #Pandemic #Era #Boost #Homeowners
Key takeaways
- More young homeowners say they feel better financially now than they did four years ago compared to younger renters, according to a recent study by Redfin.
- The financial deficit between renters and homeowners is decreasing in older generations.
- Many young renters are struggling to catch up with their peers who have managed to build wealth as home prices have risen during the pandemic.
The financial deficit is increasing among young homeowners and renters, as young renters find it difficult to break into the housing market.
A recent study from Redfin found that 69% of Millennial and Gen Z homeowners feel better financially now than they did four years ago. Meanwhile, only 52% of renters in these generations, ages 18 to 43, said they were better off.
Young renters are struggling to catch up with their peers who bought homes during the pandemic, widening the financial gap between homeowners and renters.
Many young homeowners were able to purchase their first homes during the pandemic by taking advantage of the lower mortgage rates and home prices at the time. Since then, many have benefited from the historic rise in home values in 2021 and 2022 and have built significant home equity, Redfin said.
“Economic inequality is on the rise between young people who have broken into homeownership and young people who have not,” Chen Zhao, head of economic research at Redfin, said in a press release.
Young renters are finding it more difficult to enter the housing market now, as high mortgage rates and prices keep them out.
Rent prices also continue to rise, making it difficult for young renters to save for a down payment. Minimum wage earners can no longer comfortably afford an apartment, and in 22 states, mortgage payments are cheaper than rent.
#Young #Renters #Disadvantage #Pandemic #Era #Boost #Homeowners
