How long does it take for millennials to save money to buy a house?

8 out of 10 young people dream of having their own home. How much money do they have to save to make this dream come true?

The American dream

A recent survey in the US has showed that 80% of millennials (people born between 1982 and 2004) would like to buy a house. Most of them hope to afford it in five years time. Meanwhile, 68% of the respondents have less than $1,000 in their bank account and 44% have no savings whatsoever.

Many have student debts and limited career opportunities: most young people who have just started working don’t have any funds left after paying all their monthly debts.

Wages vs. Prices

According to the survey, the real estate sector is gaining twice as fast as wages. Moreover, millennials tend to believe that they will have to pay a smaller down payment than they actually do. The majority of the respondents estimated it at approximately $37,000, which is less than half of the actual amount.

How long does it take to save enough money to afford a house?

Given the complexity of the economic situation and the lack of affordable housing in the country, the situation is alarming: at best, it will take 10-15 years to save enough money to buy a house. If choosing a slightly more advantageous location and amenities on the other hand, one should get ready to wait for about 25 years.

The bestselling author and motivational speaker David Bach warns: "If millennials don't buy a home, their chances of actually having any wealth in this country are little to none. The average homeowner to this day is 38 times wealthier than a renter."

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