Rising rent costs are straining early career professionals, particularly in the Gen Z cohort, born between 1997 and 2012. A Zillow study reveals that 60% of Gen Z renters allocate over 30% of their income to rent, a slight decrease from millennials in 2012. Notably, certain cities display an increase in rent-burdened young residents compared to a decade ago, according to Zillow’s economist Kenny Lee. This financial trend potentially hinders young renters from affording essentials and saving for future goals.
Zillow’s data highlights the top five cities facing this challenge. In Houston and San Antonio, 66% of Gen Z renters are rent-burdened, a rise from 54% and 59% of millennials in 2012. Denver and Minneapolis also show increases to 61% and 62%, respectively, from 55% and 56%. San Diego sees the highest burden, with 73% compared to 67% of millennials ten years prior.
Interestingly, high-cost cities like New York, Los Angeles, and San Francisco are absent from the list. Researchers attribute this trend to the COVID-19 pandemic, which sparked a demand surge for suburban housing as professionals moved away from major cities. As the housing market struggled to meet this demand due to longstanding supply issues, rent prices spiked in these locales.
Despite these challenges, Lee provides a glimmer of hope, noting recent stabilization in rental markets, potentially easing the financial strain on Gen Z renters. For those seeking salary increases amid high-cost living, CNBC offers an online course on negotiation, promising skills to secure higher wages. Additionally, subscribing to CNBC’s Make It newsletter can provide insights for success in work, finance, and life.
Original Story https://www.cnbc.com/2024/11/17/cities-where-more-gen-zers-are-rent-burdened-than-millennials-were.html
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