Detroit a National Leader In Millennial Home Ownership
Detroit was one of the cities hit hardest by the Great Recession. Almost overnight thousands of home loans were foreclosed. And while other cities have slowly seen an improvement in their conditions, Detroit has struggled to get back on track. But for one group, Detroit has become an unusual haven.
Millennial homeownership in Detroit is at 40%, placing it in 19th place for home ownership in cities across the nation — second among large cities. Across the nation, home ownership for people under the age of 35 was around 33% in 2015, down 5% from 2001.
The cause of this abysmal national rating should be no surprise, considering the astronomically high student loan debt and the fact that Millennials earn a fifth less than Baby Boomers did at their age. And of course the oft-lamented propensity towards purchasing expensive coffee and avocado toast.
One of the main reasons that Detroit is seeing the higher rate of Millennial home ownership is the significantly lower cost of homes and the home buyer-friendly initiatives launched by the city’s mayor to enable more people to buy homes.
Another advantage Detroit has over other cities is that it takes much less time to raise the money for a down payment than other large markets — 8.5 years on average. Many other large cities require Millennials to save for decades in order to afford a down payment on a home.
But even despite the setbacks that have led to slower growth in Millennial homeownership, they now represent the largest share of new home purchases in the past few months. And it is unlikely that trend will stop.
With almost a third of Millennials, 31%, reporting that they plan to purchase a home within the next two years, it is no doubt that cities and neighborhoods such as Detroit, with fewer barriers to homeownership, will see the number of Millennials calling the city home explode.