Soaring Costs Force Young Americans to Get Creative: Co-Buying Explodes, Even Mom Can't Help in New Jersey
As soaring home prices and interest rates continue to make homeownership an uphill battle, a recent survey by Credit Karma reveals that younger Americans are open to exploring less traditional routes to achieve this milestone. The survey found that over a third (35%) of non-homeowners would consider jointly purchasing a property with someone other than a romantic partner, such as friends or a friend group. This figure soared to a staggering 59% among Gen Z respondents, highlighting their willingness to think outside the box.
Courtney Alev, a consumer financial advocate at Credit Karma, attributes this trend to the perception that homeownership may be out of reach for many young people on a single income. "There's this new openness to other forms of ownership," she explains. While acknowledging potential complications with multi-party property ownership, Alev commends the creativity and determination of those seeking alternative paths to their goal.
Beyond co-buying, younger aspirants are also embracing sacrifices to save for a down payment. Many are cutting non-essential expenses like travel and dining out (35%), working longer hours (28%), delaying major purchases (27%), or even moving back in with family (16%, rising to 35% for Gen Z).
Parental financial assistance is another avenue being explored, with 18% of overall non-homeowners planning to seek help from their parents for their first home purchase. This figure skyrockets to 44% for Gen Z, dwarfing the 16% of Millennials and 12% of Gen X respondents with similar plans. Among existing homeowners, 19% admitted to receiving parental aid, including 38% of Gen Z and 27% of Millennial buyers.
Alev emphasizes the importance of patience and focusing on controllable factors like responsible financial habits and maintaining a strong credit score. "Try not to get discouraged by market conditions," she advises, acknowledging the cyclical nature of interest rates and housing market challenges.
Here in New Jersey
New Jersey, with its proximity to major job markets like New York City and Philadelphia, presents a unique landscape for aspiring homeowners. The state boasts a median home price of $437,500 according to NJ Realtors, significantly higher than the national average. This high cost, coupled with property taxes that rank among the highest in the nation, intensifies the challenges faced by younger generations. Face in young New Jersey residents & aspiring home owners, you might be living in mom’s basement for awhile.
Conclusion
While the road to homeownership may be unconventional for many young Americans, their determination and willingness to explore creative solutions demonstrate resilience in the face of adversity. As Alev notes, "There is a lot of unpredictability – what's most important is that you make that move when you're ready." In the case of New Jersey, with its specific challenges and opportunities, thorough research and a willingness to explore alternative paths can increase the chances of achieving the dream of homeownership.
