“Right now affordability is a flashing yellow light on the housing market,” Yun says. “And I just hope it doesn’t become a red light that stops the housing recovery.”
At the same time, the recession has created lower income rates for potential millennial home buyers. As a result, millennials cannot create the wealth they need to make a down payment on a home.
“[There is] a chronic shortage of affordable homes in thriving neighborhoods, limited access to financing even with record-low mortgage rates and sky-high rents that eat into down payment savings,” says Nela Richardson, chief economist for the Redfin real estate brokerage.
Millennials are also hampered by their student loan debt, according to NAR, and their low credit scores, according to Ellie Mae’s Origination Insight Report.