I hear it time and time again… I wish I would have bought a house last year, I wish I would have bought a house 5 years ago…I’ll just wait for the market to crash. There is not a foreseeable crash or slow down in sight for the Denver market. So don’t keep waiting for that one day. The best way to participate in Denver’s real estate market is to get started. As you see in the example below, if you had bought a house in May 2019 by May 2020 you’d have about 30,000 in equity and grow from there. Then, you’ll easily have the equity to roll forward into your next home.
Generation Z renters will spend more money on rent before they buy a home than any previous generation, according to a report from HotPads.
Gen Z will spend an average of 11 years renting before becoming a homeowner, one year less than millennials.
The top four cities where Gen Z renters are projected to spend the most money on rent are all in California.
It’s no surprise that rent is more expensive for millennials than it was for baby boomers.
But soaring rent costs will hit Generation Z the hardest, those born between 1998 and 2016, according to new analysis from HotPads, a Zillow Group site.
Even when adjusted for inflation, today’s youngest adults will spend more on rent in their lifetime than their predecessors, according to the report. Members of Gen Z will spend an average of $226,000 on rent before ever owning a home.
That tops older generations, surpassing the $202,000 millennials will end up spending on rent, and the average $148,900 baby boomers spent on rent before becoming homeowners after adjusting for inflation.
But while Gen Z will spend more money on rent in their lifetime — paying a median of $1,710 a month — HotPads estimates the younger generation will be quicker to buy homes than millennials. Baby boomers spent an average of 10 years renting before buying, Gen Z will spend 11 years, and millennials will spend 12 years renting.
“While there are a lot of unknowns about how the American economy will evolve over the coming decades as Generation Z grows into adulthood, if historical trends hold, the long-term forecast right now suggests that Generation Z is likely to benefit from a stronger job market than millennials,” said HotPads economist Joshua Clark.
Clark also said that “while rising rents and home values mean that it won’t be as easy for Generation Z to become homeowners as it was for baby boomers, they should get there sooner than millennials did.”
HotPads analyzed government data and its own rental data to determine how much total rent each generation paid or will pay in their lifetime before becoming homeowners, as well as how many years they spent or will spend renting. HotPads based their projections on data for the average person in the median birth year of each generation — 1954 for baby boomers, 1987 for millennials, and 2002 for Gen Z. They also assumed renters begin paying rent at age 20.
Below, see the 10 cities expected to be most expensive for Gen Z renters, plus how much the average millennial and baby boomer renter spent or will spend there before buying a home.
10. Miami, Florida
- Generation Z total rent paid: $305,100
- Millennials total rent paid: $258,400
- Baby boomers total rent paid: $180,700
9. Denver, Colorado
- Generation Z total rent paid: $320,300
- Millennials total rent paid: $251,200
- Baby boomers total rent paid: $169,500
8. New York, New York
- Generation Z total rent paid: $323,800
- Millennials total rent paid: $318,700
- Baby boomers total rent paid: $194,700
7. Washington, DC
- Generation Z total rent paid: $328,400
- Millennials total rent paid: $311,100
- Baby boomers total rent paid: $232,800
6. Seattle, Washington
- Generation Z total rent paid: $358,200
- Millennials total rent paid: $265,900
- Baby boomers total rent paid: $162,210
5. Boston, Massachusetts
- Generation Z total rent paid: $367,100
- Millennials total rent paid: $311,000
- Baby boomers total rent paid: $192,200
4. San Diego, California
- Generation Z total rent paid: $405,700
- Millennials total rent paid: $333,500
- Baby boomers total rent paid: $236,300
3. Los Angeles, California
- Generation Z total rent paid: $470,400
- Millennials total rent paid: $359,600
- Baby boomers total rent paid: $225,200
2. San Jose, California
- Generation Z total rent paid: $560,300
- Millennials total rent paid: $429,200
- Baby boomers total rent paid: $281,700
1. San Francisco, California
- Generation Z total rent paid: $570,900
- Millennials total rent paid: $399,400
- Baby boomers total rent paid: $230,000
If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. I’m here to help.
