Millennials have grown accustomed to being the most hated and most often misidentified generation, according to an unscientific poll of millennials in the salty group chat.
We’re taking it from both sides with Gen Zers slamming millennials’ middle parts and skinny jeans while Gen X and Baby Boomers get on us for being too sensitive. But the older generations seem to think millennials are still college-aged, when in fact the youngest millennials will officially reach their mid-20s this year and the oldest millennials will turn 40.
While most millennials are well out of college, we’ve been saddled with massive amounts of student loan debt, leaving us with higher debt-to-income ratio than previous generations. And according to the Urban Institute, just a 1% increase in student loan debt can hurt someone’s homeownership odds.
Saving for a down payment for a house has become trickier for millennials, but debt consolidation could be a good idea to help pay off debt faster while also saving money on interest. Once you lock in a mortgage, there’s a good chance your monthly payment will be lower than whatever astronomical amount you’re paying for rent in That Expensive City, USA.
The cost of being the most educated generation
If you point out to a Boomer that it’s mostly Gen Zers who are in college now, they’ll probably make a snide remark about millennials still being in college well into their 20s. But the average college graduation age for traditional full-time students who start college at 18 (i.e., right after high school) is 23.
Millennials have dealt head-on with the rising costs of college, plus we are more likely to go to graduate school than previous generations. The oldest Gen Xers had an average annual cost of a little over $18,000 for a four-year private school from 1983-84 compared with the oldest millennials’ almost $29,000 from 1998-99, per the Department of Education.
So, while being the most educated generation in U.S. history has some advantages in the job market and income range, it certainly has its downsides. The median debt among millennials ($19,000) was significantly higher than the median debt among Gen X ($12,800) in 2019, according to Pew Research.
Millennials are living at home longer
Not all of that millennial debt is for lack of financial responsibility, though. In fact, many are making the responsible decision to delay fleeing the nest for the big city.
Many millennials entered the job market smack in the middle of the Great Recession, making it not only difficult to find a job but also hard to afford moving out.
Millennials are prolonging their time at mom and dad’s house as they delay traditional next life steps of marriage, having kids, and home buying. (Normalize singlehood and living on your own!)
In 2019—before the pandemic—more millennials were living at home than at any other point in the 21st century, according to Zillow.
As of July 2020, more than half of young adults ages 18-to-29 were living with their parents, up 5% from February 2020, according to Pew Research. That’s higher than at any other point since the Great Depression.
How the COVID-19 pandemic affected the housing market
The coronavirus pandemic has been extremely devastating in many ways, with more than half a million Americans losing their lives.
It also crushed the economy, kept kids out of school, and lost people their jobs, among other heartbreaking outcomes.
But the pandemic did have one bright spot (or perhaps many for introverts)—it lit up the housing market. With interest rates hitting record low after record low and stay-at-home orders hitting most major cities last year, many flocked to the suburbs to capitalize on the opportunity for more space. With student loan debt relief extended through the end of September, millennials may be more willing to take on the added debt of a mortgage, if we can find a home for sale.
Demand has been through the roof—get it?—with nearly one-third fewer new listings and 50% fewer homes on the market the week of March 7, per Realtor.com. Not to mention, homes are selling more quickly by an entire week.
So, if you see something you like, you better try to snatch it up if you can afford it—home prices also have risen by nearly 15%. Pro tip: You may need to go quite a bit over asking, like maybe your student loan debt’s worth.