Millennials’ Debt Continues to Impact Their Homebuying Dreams
By Kelly Leighton | Aug. 18, 2022 | 2 min. read
Millennials’ debt is continuing to prevent many of them from becoming homeowners.
As the generation ages, their trouble with debt continues. According to a recent report from Clever Real Estate, 72% of millennials have some form of debt (non-mortgage), owing on average, $117,000. While 71% are confident that they can pay it off in five years or less, 9% said it will take more than a decade and 6% reported they will never be able to pay it off. Not surprisingly, 41% of millennials said they feel pessimistic about their finances.
As for regrets, millennials said they have a few. More than one-third said they regret not saving enough, 32% regret going into debt and 32% regret not investing sooner. Nearly a quarter said they wished they choose a higher-paying career and 22% regret their student loans. Nearly half (48%) of millennials have student loans, owing $126,993 on average. Credit card debt is another issue for many millennials, 67% report they have it. Twenty-nine percent said they do not pay their credit card off every month. The average amount millennials with credit card debt owe is $5,349.
The cost of housing is another deterrent to millennials. As both home prices and rent prices continue to grow, the average millennial is spending 47% of their monthly income on housing. While 53% of millennials are homeowners already, 40% of those homeowners do not think they could afford a home in today’s market. About 30% of millennials who are not homeowners do not think they will ever be able to afford to buy a home.
However, there are millennials who are debt-free, about 28% of them. More than one-third (34%) said they have never had debt, while 40% have paid everything off in the last two years or less. Of those who have paid off their debt, 83% said they think they can stay out of debt.
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