One of the biggest challenges for first-time homebuyers is saving.
Coming up with a down payment is a hurdle for the majority of millennials, shows study after study—but, there are areas where the average earnings are enough to save sufficiently, according to an analysis recently released by RealEstate.com. The easiest market? Chicago, where the average first-timer can save 20 percent for a starter in just over three years.
1. Chicago, Ill.
Annual Household Income for Millennials: $50,500
Annual Millennial Savings: $10,821
Median Starter Value: $177,300
Down Payment (20%): $35,460
Savings Timeline: 3 years, 3 months
2. Dallas-Fort Worth, Texas
Annual Household Income for Millennials: $50,600
Annual Millennial Savings: $10,843
Median Starter Value: $185,400
Down Payment (20%): $37,080
Savings Timeline: 3 years, 5 months
3. Detroit, Mich.
Annual Household Income for Millennials: $43,100
Annual Millennial Savings: $5,388
Median Starter Value: $96,700
Down Payment (20%): $19,340
Savings Timeline: 3 years, 7 months
4. Baltimore, Md.
Annual Household Income for Millennials: $54,300
Annual Millennial Savings: $11,636
Median Starter Value: $214,000
Down Payment (20%): $42,800
Savings Timeline: 3 years, 8 months
5. Indianapolis, Ind.
Annual Household Income for Millennials: $39,400
Annual Millennial Savings: $6,567
Median Starter Value: $122,500
Down Payment (20%): $24,500
Savings Timeline: 3 years, 9 months
6. Pittsburgh, Pa.
Annual Household Income for Millennials: $41,700
Annual Millennial Savings: $5,212
Median Starter Value: $103,600
Down Payment (20%): $20,720
Savings Timeline: 4 years
7. Cleveland, Ohio
Annual Household Income for Millennials: $42,900
Annual Millennial Savings: $5,362
Median Starter Value: $109,600
Down Payment (20%): $21,920
Savings Timeline: 4 years, 1 month
8. St. Louis, Mo.
Annual Household Income for Millennials: $43,200
Annual Millennial Savings: $5,400
Median Starter Value: $119,900
Down Payment (20%): $23,980
Savings Timeline: 4 years, 5 months
9. Austin, Texas
Annual Household Income for Millennials: $50,700
Annual Millennial Savings: $10,864
Median Starter Value: $249,700
Down Payment (20%): $49,940
Savings Timeline: 4 years, 7 months
10. Washington, D.C.
Annual Household Income for Millennials: $67,900
Annual Millennial Savings: $14,550
Median Starter Value: $343,000
Down Payment (20%): $68,600
Savings Timeline: 4 years, 9 months
The analysis factored in first-time homebuyers’ household income (median), plus the cost of a down payment on a median starter. (Twenty percent is ideal, but not a requirement.)
“Contrary to popular belief, millennials want to buy homes, but high home prices, low inventory and stagnant wage growth are some of the many factors that may be driving would-be buyers into delaying homeownership,” says Justin LaJoie, general manager of RealEstate.com. “However, in certain U.S. housing markets first-time buyers can find some relief; they just need to know where to look.”
RealEstate.com is part of Zillow Group.
For more information, please visit RealEstate.com.
Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at sdevita@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.
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