The American dream has become too expensive: Most millennials want to own a home one day, but they sure can’t afford one now.
During the pandemic, housing prices have climbed, with the nationwide increase moderating to 2.6% year over year in November. The frenzy became so intense last year that some houses sold for more than double their listing price.
On top of high prices, many millennials also have to contend with high student debt and stagnating wages.
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“There are closing costs with purchasing a home. There are fees, there are a lot of unknown factors. It’s not just a down payment,” she said. She added that many people have moved to more affordable areas in Northern California or left the state entirely.
Jermaine Toney, an assistant professor at Rutgers University, said that “wealth begets wealth.”
“There’s a very strong connection between intergenerational networks and asset-building wealth — including homeownership. Generational wealth matters,” Toney said. “A substantial portion of grandparents with the lowest proportions of wealth are likely to have grandchildren who possess low levels of wealth.”