Here’s How Much More Gen Z Pays For Rent Than Millennials Did
Rent is one of the biggest expenses in life, and new research by apartment search website RentCafe indicates that Gen Z will be putting more money toward it than millennials did.
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Leveraging data from IPUMS, RentCafe sifted through “historical housing costs and earning and spending patterns in nearly 200 metro areas in the U.S.” The company noted that it examined how much millennials paid for housing when they were between 22 and 29.
RentCafe uncovered that while Gen Z will make 14% more than millennials prior to their 30th birthdays, they’ll also be spending $145,000 on rent. By contrast, millennials “spent $127,000 during the same stage of life (14% more).” The amount Gen Z will spend on rent in their 20s, RentCafe added, “account[s] for 27% of their income from ages 22 to 29” — the same percentage that millennials had. The reason the percentages are identical, RentCafe explained, is “because Gen Z’s wages are higher today.”
Moving to a less expensive rental could be an option for Gen Zers looking to lower their renting costs. But if they don’t want to move, there are other avenues they can pursue, such as signing a multi-year lease agreement and getting a roommate.
Then there’s the path of saving up to make mortgage payments instead of rental payments. For Gen Zers considering buying a home, RentCafe found that due to their greater income, the “gap between renting and owning is smaller than it was” for millennials. Home ownership “for eight years leading up to their 30s would cost Gen Z around $165,000.” But for millennials, the price tag for that time range was $172,000.
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Gen Zers who want to buy a home with a single income can take several steps to save up and make their dreams a reality, including automating their savings and getting side hustles.
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This article originally appeared on GOBankingRates.com: Here’s How Much More Gen Z Pays For Rent Than Millennials Did
