According to Zillow, it’s actually more affordable to buy a home now in most U.S. cities than it was 15 years ago, while rental rates continue to soar. On average homeowners making the nation’s median income and purchasing the typical U.S. home spend 15.3% of their income on their monthly mortgage payment while renters are now spending close to 30% of their monthly income on rent.
Of course, smaller down payments mean young buyers are spending 17.4% on their monthly payments. Low interest rates and their willingness to shop for less expensive homes are allowing more and more millennials into the buying market.
Rising rentals make it more difficult for young people to save, at the same time as serving as the prime inducement to buy.