A growing number of 20- and 30-somethings in Greater San Jose, Greater San Francisco and other cities across California find homeownership far beyond their means.
The Golden State has seven of the nation’s largest metro areas with the lowest rates of homeownership for 25-to-34 year-olds, with less than one in four who own their home, the San Jose Mercury News reported.
The vast majority of young adults in the Bay Area and other metro regions now rent rather than own their home, with many saying they have no hope of buying.
The Los Angeles-Long Beach-Anaheim metro area, where 19.9 percent of young adults own their home, scored lowest in the nation, according to a Bay Area News Group analysis of Census Bureau figures from 2017 to 2021.
Santa Maria-Santa Barbara was a tad better with a young adult home ownership rate of 21 percent.
The Central Coast cities were followed by Santa Cruz-Watsonville at 22.5 percent, San Jose-Sunnyvale-Santa Clara at 22.8 percent, Salinas at 23.3 percent, San Francisco-Oakland-Hayward at 23.4 percent and San Diego-Carlsbad at 23.8 percent.
The BANG study filtered out young people who live with their parents. It only included young adults identified as the head of their household or were married to the head of their household.
When compared to California, other parts of the U.S. fared far better.
Young adults in the Denver-Aurora-Lakewood, Colorado, metro area had a home ownership rate of 39.7 percent, with 37.8 percent in Jacksonville, Florida, and 42.9 percent in Baltimore-Columbia-Towson, Maryland, owning their own houses.
The Lake Erie city of Monroe, Michigan, with 20,000 residents halfway between Detroit and Toledo, had the highest rate of young adult home ownership at 70.8 percent.
Many young adults who have searched for a starter home in the Bay Area say they’ve given up in the wake of rising interest rates and soaring housing prices that just keep getting higher.
Experts say that although declining young adult homeownership rates are a national trend, it’s especially bad in the Golden State. One recent study by UC Berkeley’s Terner Center for Housing Innovation found that by 35, most U.S residents had become homeowners. In California, it wasn’t until age 49.
They blame the student debt crisis and a delay in when people get married as important reasons for why youth homeownership is on the decline from coast to coast.But there is no surprise what’s behind California’s spectacularly low young adult homeownership rate – housing costs, and wages that don’t keep up. Homes in the Bay Area, where the median single-family house costs $1.25 million, are unattainable for most young adults.
— Dana Bartholomew
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