That gap is driving some first-timers out of the most expensive cities and pressuring them to buy something before they are completely priced out of the market.
SALT LAKE CITY — For millennials looking to buy their first home, the hunt feels like a race against the clock.
In the seven years since the housing crash ended, home values in more than three-quarters of U. S. metro areas have climbed faster than incomes, according to an Associated Press analysis of real estate industry data provided by CoreLogic.
That gap is driving some first-timers out of the most expensive cities as well as pressuring them to buy something before they are completely priced out of the market.
The high cost of home ownership is also putting extreme pressure on 20- and 30-somethings as they try to balance mortgage payments, student loans, child care and their careers.
“They do want all the same things that previous generations want,” said Daryl Fairweather, chief economist for the brokerage Redfin. “They just have more roadblocks, and they’re going to have to come up with more creative solutions to get the homes that they want.”
A Redfin analysis found these buyers are leaving too-hot-to-touch big-city markets — among them, San Francisco and Seattle, where the tech boom has sent housing prices into the stratosphere. The brokerage found that many millennials are instead buying in more reasonably priced neighborhoods around places like Salt Lake City, Oklahoma City and Raleigh, North Carolina. That, in turn, is driving up housing prices in those communities.
Jake and Heather Rice, both 35, moved to Utah last year from Mountain View, California, where the biggest employers are tech giants such as Google, Symantec and Intuit and the median home price is a dizzying $1.4 million or so.
The couple and their three children settled into a 4,500-square-foot house in fast-growing Farmington, just far enough away from Salt Lake City to feel rural but minutes from a major shopping center and Heather’s sister. They did not disclose the purchase price for the sake of privacy, but they said their monthly mortgage payments will be $3,000, roughly the same as the rent for their former two-bedroom, 1,000 square-foot apartment in Mountain View.
