@Benjamin Riehle @Jeff B. @Karen Lundy @Natalie Kolodij @Ryan Dossey @Ralph R. @Thomas S.
I would like to thank everyone for their posts, opinions and how they feel about why millennials are not buying homes. It's interesting to see posts from people from different backgrounds and age groups.
Here is a little background about myself, and why I, as a millennial at the age of 29, with an engineering degree, living around Boston have not bought a house.
I graduated college with an engineering degree in May 2010 with $55K (before the 4-9% interest, after scholarships and grants and that's a small amount compared to most) to pay off, a car to pay off as I could not use public transportation, and no sustainable full time position/job. I was not able to get a job until January 2011 no thanks to the economy so I was more or less broke and in a lot of debt. This full-time position had no pension otherwise known as a defined benefit plan as such a thing in most private positions is a thing of the past, I have to depend on a 401K or what is known as a defined contribution plan. I was laid off from my full-time position at General Dynamics in 2013 while I was on short term disability. I finally found a full-time position three months after that and am now living in the Greater Boston area. Now it is 2016, I finally paid off my colleges loans (2x, 3x, 4x payments) as the debt and the piling interest was too much for me to bear and paid off the car, note I did this with little help from family or parents because I do not have that luxury for them to financially assist me. I have been renting in what is now one the most competitive and low inventory areas for real estate in the country, single families, multi families, all the above.
Now to the point, why have I been renting and not purchasing a property which sounds like the financially responsible and sound decision? It's not for a lack of effort on my part, a desire for entitlements, not being capable or willing to plan for the future, a fear that our fragile economy could potentially collapse at any moment, invested in a major that may or may not have fit with the strong tech market that is today or any the the above.
It is because it's not that simple, it is not always better to purchase than rent at that given time period in that given location. The price to rental ratios in and around Boston for multi-families often are too high and or the areas are too violent/risky too me. I have lived in not such great areas so I fully know from personal experience and value my life more than wanting to get shot or assaulted. Single families are in very low inventory themselves and the prices extremely high for what they are.
I did an analysis, an analysis on purchasing a $400K single family house (w PMI as I don't have the 18-20% for down payment) and renting at $1650 per month. These prices are from the properties and rents that I am considering and by far these are not even close to the medium-high or high side for Boston and/or the surrounding area. This analysis goes over closing costs, property taxes, PMI, mortgage costs, interest on top of that, utility costs, maintenance costs, equity, potential appreciation and inflation. This analysis has lots of variables and factors where none are definitive and/or solid but I did my best and found that the cost of renting was almost equivalent to the cost of purchasing a house in the Boston area over the course of 30 years. Take that in for a moment, can that be true? I would love to see what other people's results are but do not generalize, account for different house prices, rents, locations, etc.
That's why I am going to continue to rent in the area that I am bound to and continue to work hard and smart to live, survive and conquer the situation, the world and the hand that I have been dealt.
Because generalizing is dangerous, especially to those who assume, who don't look at all the factors or don't attempt to, to those who judge 'millennials' who have never been in their shoes and judge a few million by the actions and behaviors of a few thousand.
