Even as they get set to surpass Baby Boomers as the nation's largest generation, millennials are delaying many of the traditional markers of adulthood, which includes buying a home, according to a study by Apartmentlist.com.
The study indicated that despite recent increases, the rate of homeownership among millennials still lags the previous generations at a similar age due to macroeconomic trends that are making it difficult for this generation to take the plunge and buy their own abode.
For the study, Apartmentlist surveyed 6,400 millennial renters on their plans for homeownership or buying a condo. It found that while the majority of respondents said that they would like to purchase a home at some point in the future, the number of millennials who were prepared to do so in the near term were "far fewer."
One of the biggest factors in this delay, the study found, was down payment. Forty-eight percent of the respondents surveyed for the study said that they had nothing saved for the down payment. Looking at the future, the study projected that two-thirds of this population would require more than two decades to save a 20 percent down payment based on their current savings rates.
" Just 11.1 percent of millennials have saved more than $10,000 for a down payment, while an astounding 48 percent have saved nothing at all," the study said.
The survey for this study had also asked respondents about their ongoing savings rate and found that 43.3 percent were "putting none of their monthly income towards down payment savings."
The larger question, that many millennials were not prepared for was whether the down payment they were saving up for, would be enough, according to the study. It revealed that millennials were likely to need a larger down payment than they thought.
Giving the example of San Francisco, which is also "the nation's priciest market," the study said that average survey respondents said they would need approximately $99,300 for a down payment to buy in this area. However, the study revealed that an actual down payment of 20 percent here was estimated at $175,180. "We see this trend even in more affordable markets. In Phoenix, for example, a 20 percent down payment on the median-priced condo amounts to $33,400, but our survey respondents in the area expect to need $17,610, on average," the study said.
Click here to read the full study.