Seven in 10 Gen Z and Millennial renters struggle to afford their regular housing payments, as do 41 percent of homeowners in that age group, according to a new report from Redfin.
Forty percent of Gen Z and Millennial renters are eating out at restaurants less frequently to make their monthly rent payments, making it the most common sacrifice among that group. The next-most common sacrifice is taking no or fewer vacations. Additionally, 27 percent of renters in these age groups borrowed money from family or friends and 25 percent worked extra shifts.
Also, 22 percent of young renters report skipping meals completely to make their monthly payments and the same percentage have sold their belongings. And 19 percent of young renters have delayed medical treatments to afford monthly payments.
“Many Gen Zers and Millennials are making real sacrifices—picking up side gigs, selling their possessions, even delaying doctor’s appointments—just to pay for the basic need of housing,” Daryl Fairweather, Redfin’s chief economist said in a statement. “At the same time, a lot of the young people who can easily afford housing can do so because they have major financial support from their parents, with roughly one-quarter of the young Americans who recently bought a home using family money for their down payments. With the cost of buying a home rising much faster than wages, people without access to family money are much more likely to struggle to pay for housing—which could widen the gap between the haves and the have-nots in the future.”
Struggling Millennials and Gen Zers who own their homes are more likely than those who rent to sacrifice luxuries, namely eating out at restaurants (43 percent) and taking vacations (36 percent). But they’re less likely to sacrifice necessities: Just about one in 10 (11 percent) report skipping meals completely to make mortgage payments, and 13 percent have delayed medical treatments.
Along with struggling to afford housing payments, there is also a lack of job security. 44 percent of American workers are delaying or canceling a major purchase like a home or car due to their feelings about job security, according to a Redfin report. 49 percent of working renters are delaying a major purchase while 27 percent of working homeowners are delaying major purchases.
If these individuals were to lose a job, they would further struggle to make housing payments. 36 percent of American workers do not have an emergency fund to cover their monthly mortgage or rent payments in the event they face a financial crisis, like losing a job.
