“For Millennials, there will be no American Dream—with a home of their own at the center of it—unless we take thoughtful, comprehensive action starting now”
You may be a Millennial who is wondering why you’re thirty-years old and haven’t yet purchased a home. The truth is, many Millennials can barely afford housing at all.
There is no shortage of statistics related to the financial struggles of the average American. It’s easy to get buried in a cascade of numbers related to income inequality, the shrinking middle-class, lack of retirement and savings, and just about every other indicator of how impossibly expensive life has become for most Americans. So consider this simple proof instead—the target amount to spend on housing is roughly 30% of your monthly income. The latest U.S. census puts the average worker’s annual salary between $31,099 and $46,550—a total income of about $2500 to $3800 a month before taxes. Sticking to the 30% equation, that leaves about $750-$1,100 respectively for housing before related expenses like utilities.
Go ahead and try to find a reasonable rent in that price range in most markets, never mind a mortgage payment for your first home. Indeed, only 64.3% of Americans own homes, as of July 26, 2018.[6] The number of Millennials, specifically, is 37%.[7]
Yet Millennials make up the largest segment of America’s workforce, despite struggling with unemployment—or underemployment—because they began looking for their first “adult” jobs in the aftermath of the 2008-2009 recession. After nearly being shut out of the job market, Millennials are now being shut out of the most crucial element of the American Dream. But the problem goes beyond dreams. Housing is a basic human need, like food and clothing. People don’t feel secure without access to those essential things. And without security, they are less likely to do things like start a family.
