Young adults saving up for down payment
Roseville, Calif.- New data shows that young individuals living at home with their parents are ready to purchase. This age group, 25 to 34, saved enough while staying with their family to move out independently.
During the pandemic, a record number of young adults moved back home. Now it appears they are ready to move out. According to the National Association of Realtors, 15.6 percent of adults aged between 25 and 34 lived at home with their families. This is down from 2020 when it was reported that 17.8 percent lived at home. Looking at Census Bureau information, the historical percentage of 25 to 34 adults living at home is less than 10 percent.
High rents, remote work
In recent years, high rents and the opportunity to work remotely have prompted many young adults to move back home. Moving home allowed these young adults to improve their finances. This may have allowed them to save, pay down debt and improve their credit score and debt-to-income ratio.
Rents also are up by double digits, jumping 14% from 2021 to 2022, which may be prompting more young adults to move straight from their parent’s houses into their own homes. According to the NAR, the share of first-time buyers who moved directly from a family member’s home grew significantly, reaching 27% in 2022 compared to 15% in 1995.
Living at home may not be ideal for many people, but if prospective first-time buyers can move home before purchasing, it might help them save to buy a home. In addition, the added flexibility of living with family allows a buyer to navigate the tight housing market with limited affordable inventory.
