Staring down home prices that in the Bay Area and elsewhere have soared into the millions, more millennials are expecting to rent forever.
That’s especially true in and around San Jose, San Francisco and Oakland.
More than 18 percent of millennials — currently between the ages of 23 and 38 — in the San Jose metro area are planning to always rent, according to a new report from Apartment List. In the San Francisco area, which covers Alameda, Contra Costa, San Francisco, San Mateo, and Marin counties, 17.1 percent expect to rent for their entire lives.
While fewer millennial renters in the country as a whole — 12.3 percent — are expecting to make rent payments forever, the percentage who are abandoning the long-held ideal of homeownership is growing. A year ago, just 10.7 percent said they would always rent.
Affordability — or the lack thereof — stands out as the biggest factor behind the numbers. Almost half of millennial renters have no down payment saved, with just 13 percent having more than $10,000 put away. In the Bay Area, a young person would need to have more than $200,000 to put a traditional 20 percent down on many properties.
Delma Hernandez would love to buy a home in San Jose someday.
“That’s always been my dream,” the 26-year-old said.
But now, Hernandez said, “that dream doesn’t seem realistic.”
Hernandez, who belongs to the San Jose Renters’ Rights Coalition, is especially worried that with companies like Google deciding to build large office complexes in the city, home prices will go up even more.
Millennials also point to bad credit and student loan debt as key obstacles to homeownership. In addition, the level of financial support some young people expect from their families is declining. And as a stark reminder of the …read more
Source:: The Mercury News – Business