For most millennials, renting a place of one’s own is way too expensive. High rents in expensive markets — including Miami — mean not only less space but also less privacy.
A just released report by the real estate website Trulia reveals that the generation of 18- to 35-year-olds is willing to give up personal space to save money. Sixty percent of today’s young adults are living with their parents, relatives, or roommates — a near-historic 115-year high.
Other key findings from Room For Rent: Where Getting A Roommate Pays Off the Most:
▪ The typical renter can save 13 percent of his/her income by splitting a two-bedroom with one other roommate instead of renting a one-bedroom alone in the top 25 markets. Miami millennials aren’t as lucky, though. Miami is the only rental market where sharing a two-bedroom with a roommate does NOT lower rent payments below 30 percent of income. However, sharing a three-bedroom rental with two roommates can lower housing costs so it only eats up 30 percent of total income.
▪ A typical renter in Miami would need to spend almost 50 percent of income to rent a one-bedroom. A typical Miami millennial renter spends even more — 54 percent of income. That’s a larger bite out of the budget than in other high-rent cities, including New York, Los Angeles and Boston.
60 percentof young adults live with family or friends
▪ Expensive markets afford the biggest savings, unless you live in Miami. For example, New York renters can cut up to 51.8 percent of their housing costs when they share a three-bedroom instead of renting a one-bedroom rental. In Miami, splitting a three-bedroom home saves a renter 39.6 percent of housing costs. Splitting a two-bedroom could save an amount equivalent to 17.7 percent of the median household income or $640 per month in Miami.
▪ Housing continues to take a big chunk of a millennial’s income, particularly in the top 12 rental markets, where millennial households must spend more than 30 percent of the median household income on a one-bedroom apartment. If renters are willing to share a two or more bedroom, however, rent becomes more affordable in 11 of those 12 markets.