Are You a Member of Gen Z Spending Too Much on Your Housing?
by Jeff Housenick May 5, 2018
I’ve been a real estate agent for over 20 years and in that time, I’ve learned one thing about our industry – you’re dealing with people. Some people make a conscious choice — others fall into the trap of spending all their money on their homes, only to become frustrated by the process and make bad decisions about how to maintain them.
A recent survey of members of Generation Z (Gen Z) shows they are making all types of mistakes that are impacting the homeownership.
According to the report by Urban Land Institute, “Gen Z is now home to more than 36 million people who began living in the U.S. in 1997, who have been living in the U.S. for more than two years, and who are projected to increase by over 40 million by 2060.”
The report’s findings are quite startling. Almost 40 percent of the study respondents have spent more than half of their budget on housing. One in five respondents said their spending was equal to or exceeded their budget.
I would argue that these numbers are not limited to Millennials, as nearly 75 percent of Gen Z spend more than half of their budgets on housing. This can be a real problem for many, as the report illustrates that they have a high propensity for home-related debt.
The survey also showed that nearly a quarter of respondents have not yet saved enough money for a down payment to help cover the cost of buying a home. And, most respondents spent more than half their budget on housing in the last year, indicating a high degree of spending in the past year.
What can be done to avoid costly mistakes in the housing market?
First, there are important lessons to learn from the survey’s report that can help homeowners avoid costly mistakes.