“The amount of money being spent on rent is at generational highs. High rents make it tougher for potential home buyers to save for a down payment and this trend has impacted Millennials greatly.
Over the last decade we have gained 10 million renter households while netting out at close to zero for actual homeowners.
Americans who own a home with a mortgage are spending a smaller share of their income on the mortgage payment. But what you will also notice is that renters are spending a lot more of their income on rents.
While nationwide people that have a mortgage are spending less, in Los Angeles people are now spending more (nearly 50 percent of income on mortgage payments). And it is worse for renters: between 1985 and 2000 the average amount of income spent on rent was 36 percent for the L.A. metro area. Today it is at 48 percent–nearly half of income is spent on rent or mortgage payments.”
Should be interesting to see how this plays out long-term.
