SAN FRANCISCO, May 18, 2018 /PRNewswire/ -- Generation Z can
expect to spend $226,000 on
inflation-adjusted rent in their lifetime -- about $24,000 more than millennials and $77,000 more than baby boomers, according to a
new HotPads® analysis.i
HotPads analyzed U.S. governmentii data and HotPads
rental data to determine how many years each generation spent or
will spend renting in their lifetime, as well as how much total
rent each generation paid or can expect to pay.
While Generation Z can expect to pay more in rent than past
generations, they may become homeowners slightly sooner than
millennials. If historical trends hold, Generation Z is on track to
spend less time renting than millennials. Baby boomers rented for
about 10 years before half the generation became homeowners,
millennials will rent for 12 years to reach that point, and
Generation Z will rent for 11 years.iii
Though the oldest members of Generation Z are just entering the
housing market as renters, they have a high regard for
homeownership -- more than half of Generation Z renters say they
considered buying during their search, and they are just as likely
as older generations to consider homeownership part of the American
Dream.iv
However, saving for a down payment on a home has become more
difficult as rents rise, making it harder for younger generations
to buy a home. Nationally, the current median rent was about
$1,418 in March 2018, up 1.6 percent over the past
year.
"Millennials entered the workforce during the Great Recession –
a period of scarce job prospects and strong demand in rental
markets across the country – making it harder for them to keep up
with rising rents and still put money aside for a down payment,"
said Joshua Clark, economist at
HotPads. "Millennials have also delayed major life decisions that
typically coincide with homeownership, like getting married and
having children, adding on to the total number of years they've
spent 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. 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."
Rising home values can also affect renters' ability to save for
a down payment. The current median home value in the U.S. is about
$213,100, up 8 percent
year-over-year.v In order to put 20 percent down on the
median home, renters would need to come up with $42,600. In 1974, when many baby boomers were
just entering adulthood, the median home value in the U.S. was
equivalent to $182,800
today.vi
The gap between Generation Z's total lifetime rent and
millennials' total lifetime rent is widest in San Francisco, San
Jose and Los Angeles --
median rent in these metros is more than double the national
median. Cleveland, Baltimore and Cincinnati have the smallest gap in lifetime
rent paid between Generation Z and millennials.
HotPads is a Zillow® Group-owned apartment and home search
platform for renters in urban areas across the United States. For more information on the
U.S. rental market, visit HotPads.com.
|
Generation
Zvii
(11 years
renting)
|
Millennialsviii
(12 years
renting)
|
Baby
Boomers[ix]
(10 years
renting)
|
Metropolitan
Area
|
Total Rent
Paid
|
Median
Monthly
Rent
|
Total
Rent
Paid
|
Median
Monthly
Rent
|
Total
Rent
Paid
|
Median
Monthly
Rent
|
United
States
|
$226,000
|
$1,710
|
$202,000
|
$1,390
|
$148,900
|
1390
|
Los Angeles,
CA
|
$470,400
|
$3,560
|
$359,600
|
$2,400
|
$225,200
|
$2,130
|
Chicago,
IL
|
$270,000
|
$2,050
|
$239,700
|
$1,630
|
$164,500
|
$1,370
|
Dallas, TX
|
$251,300
|
$1,900
|
$216,100
|
$1,480
|
$189,200
|
$1,570
|
Philadelphia,
PA
|
$252,900
|
$1,920
|
$234,500
|
$1,640
|
$170,200
|
$1,450
|
Houston,
TX
|
$238,600
|
$1,810
|
$214,700
|
$1,450
|
$202,000
|
$1,680
|
Washington,
DC
|
$328,400
|
$2,490
|
$311,100
|
$2,160
|
$232,800
|
$1,950
|
Miami, FL
|
$305,100
|
$2,310
|
$258,400
|
$1,730
|
$180,700
|
$1,510
|
Atlanta,
GA
|
$216,200
|
$1,640
|
$190,700
|
$1,330
|
$165,400
|
$1,1350
|
Boston, MA
|
$367,100
|
$2,780
|
$311,000
|
$2,110
|
$192,200
|
$1,610
|
San Francisco,
CA
|
$570,900
|
$4,330
|
$399,400
|
$2,2570
|
$230,000
|
$2170
|
Detroit,
MI
|
$192,800
|
$1,460
|
$172,700
|
$1,190
|
$159,700
|
$1,340
|
Riverside,
CA
|
$291,300
|
$2,210
|
$250,700
|
$1,730
|
$186,000
|
$1,560
|
Phoenix,
AZ
|
$220,000
|
$1,670
|
$188,200
|
$1,280
|
$138,100
|
$1,160
|
Seattle,
WA
|
$358,200
|
$2,710
|
$265,900
|
$1,740
|
$162,210
|
$1,1530
|
Minneapolis,
MN
|
$252,000
|
$1,910
|
$222,600
|
$1,530
|
$162,500
|
$1,360
|
San Diego,
CA
|
$405,700
|
$3,080
|
$333,500
|
$2,230
|
$236,300
|
$1,980
|
Saint Louis,
MO
|
$181,900
|
$1,380
|
$166,100
|
$1,150
|
$120,400
|
$1,010
|
Tampa, FL
|
$220,000
|
$1,670
|
$188,800
|
$1,280
|
$137,200
|
$1,150
|
Baltimore,
MD
|
$266,100
|
$2,020
|
$254,300
|
$1,760
|
$191,800
|
$1,610
|
Denver, CO
|
$320,300
|
$2,430
|
$251,200
|
$1,1620
|
$169,500
|
$1,420
|
Pittsburgh,
PA
|
$168,000
|
$1,270
|
$152,400
|
$1,050
|
$110,700
|
$930
|
Portland,
OR
|
$297,300
|
$2,250
|
$232,800
|
$1,510
|
$158,400
|
$1,330
|
Charlotte,
NC
|
$207,500
|
$1,570
|
$177,100
|
$1,210
|
$127,200
|
$1,070
|
Sacramento,
CA
|
$290,900
|
$2,200
|
$238,100
|
$1,620
|
$173,700
|
$1,450
|
San Antonio,
TX
|
$210,500
|
$1,590
|
$185,100
|
$1,270
|
$133,200
|
$1,120
|
Orlando,
FL
|
$225,100
|
$1,710
|
$192,600
|
$1,310
|
$139,800
|
$1,170
|
Cincinnati,
OH
|
$184,600
|
$1,400
|
$169,100
|
$1,180
|
$128,700
|
$1,080
|
Cleveland,
OH
|
$177,800
|
$1,350
|
$168,000
|
$1,170
|
$156,600
|
$1,330
|
Kansas City,
MO
|
$190,000
|
$1,440
|
$171,800
|
$1,190
|
$129,500
|
$1,080
|
Las Vegas,
NV
|
$208,500
|
$1,580
|
$187,200
|
$1,310
|
$142,800
|
$1,200
|
Columbus,
OH
|
$211,800
|
$1,600
|
$188,400
|
$1,300
|
$139,600
|
$1,170
|
Indianapolis,
IN
|
$186,500
|
$1,410
|
$169,500
|
$1,170
|
$125,700
|
$1,050
|
San Jose,
CA
|
$560,300
|
$4,240
|
$429,200
|
$2,2740
|
$281,700
|
$2,360
|
Austin, TX
|
$263,600
|
$2,000
|
$226,900
|
$1,530
|
$158,500
|
$1,330
|
HotPads
HotPads is an efficient rental search platform for urban areas
across the United States, with
features designed for competitive markets such as map-based search,
real-time notifications and detailed information on landlords and
property managers that help renters spend less time searching and
more time feeling excited about their next home.
Launched in 2005, HotPads is based in San Francisco and is owned and operated by
Zillow Group, Inc. (NASDAQ: Z and ZG).
HotPads is a registered trademark of Zillow, Inc.
i For this analysis, HotPads used data from the U.S.
Census Bureau, the Bureau of Labor Statistics and their own rental
data to determine how much rent baby boomers (born between 1945 and
1964), millennials (born between 1980 and 1994) and Generation Z
(born between 1995 and 2010) paid or can expect to pay before half
the generation becomes homeowners. All figures are adjusted for
inflation to March 2018 dollars using
metro-level rental data from the consumer price index (CPI).
ii Including data from the U.S. Census Bureau and the
Bureau of Labor Statistics
iii Half of baby boomers born in the median birth year
of their generation (1954) became homeowners ten years after they
began renting, according to a HotPads analysis of data from the
U.S. Census Bureau's Current Population Survey (CPS) made available
by the University of Minnesota's
Integrated Public Use Microdata Series (IPUMS). HotPads analyzed
similar CPS data to forecast that millennials born in the median
birth year of their generation (1987) would become homeowners
twelve years after they began renting, and that members of
generation Z born in the median birth year of their generation
(2002) would become homeowners eleven years after they began
renting. This analysis assumes renters begin paying rent at age 20.
All figures are adjusted for inflation to March 2018 dollars using metro-level rental CPI
data.
iv Zillow Group Report on Consumer Housing Trends, 2017.
https://www.zillow.com/report/2017/highlights/introducing-generation-z/
v Zillow Real Estate Market Reports, March 2018
vi Data from the U.S. Census Bureau. Adjusted for
inflation to March 2018 dollars using
rental CPI data.
vii For renters born in 2002, the median birth year of
Generation Z.
viii For renters born in 1987, the median birth year of
millennials.
ix For renters born in 1954, the median birth year of
baby boomers.
View original
content:http://www.prnewswire.com/news-releases/generation-z-will-pay-226-000-in-rent-in-their-lifetime-300650716.html
SOURCE HotPads, Inc.