Gen Z has started buying homes: They love Salt Lake City and Louisville

Twenty years ago, enterprising young people dreamed of living in The Big Apple or The City of Angels. Now they are settling in Salt Lake City and Louisville.

A new report from the LendingTree Loan Market reveals that Gen Z made up 10% of homebuyers in America’s 50 largest metropolitan areas last year. Their favorite cities to buy are mid-sized and inland.

From deposit to Z

The oldest members of Gen Z – those born between 1997 and 2012 – are finishing their education, leaving the nest and starting a career. But they haven’t exactly had a welcome economic introduction into adulthood, starting to work amid the biggest rise in costs in forty years.

Then you have to find accommodation. Rents in major cities have soared — according to Zumper, the median monthly rent for a one-bedroom apartment in New York City is $3,420, up 38% year over year. Buying is even more daunting: the median price of an existing home in the United States hit a record high of $391,200 in April. Gen Zers are find homes – in non-coastal towns that haven’t been gentrified into overpriced oblivion:

• At 16.6%, Salt Lake City holds the largest share of mortgages offered to Gen Zers. Louisville, with 15.9%, is second and Oklahoma City follows closely, while the coastal centers of New York (4.4%) and San Francisco (3.6%) are second to last and dead last among the 50 largest metropolitan areas in the United States.
• The difference between the average down payment of Gen Z homebuyers in New Orleans ($13,060) or Louisville ($14,268) compared to San Francisco ($42,000) or New York ($32,000 $) speaks for itself, and so do home prices: in Salt Lake, an average mortgage requested by a Gen Z homebuyer is $291,952; in San Francisco, it’s $408,000.

“While the results don’t reduce how difficult it can be to buy a home…they help dispel the myth that home ownership is impossible for all young Americans,” writes Jacob Channel, senior economist by LendingTree.

Loan at maturity: The average Gen Z home buyer in San Francisco has a credit score of 723 — but head to Louisville, Indianapolis or Birmingham, Alabama, and it’s just 699.