ECONOMY & WORK
MONEY 101
NEWS
PERSONAL FINANCE
NET WORTH
About Us Contact Us Privacy Policy Terms of Use DMCA Opt-out of personalized ads
© Copyright 2023 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.
MARKETREALIST.COM / ECONOMY & WORK

Real Estate Agent Worries That the Next Gen Will Not Be Able to Retire as House Rents Skyrocket

"How will the millennials and Gen Zers retire comfortably if they don’t own a house and are going to have to rent forever?"
PUBLISHED MAR 11, 2024
Cover Image Source:  The next gen might not be able to retire at all | TikTok | @fmsmith319
Cover Image Source: The next gen might not be able to retire at all | TikTok | @fmsmith319

We are often told that the 20s are for hustling before you settle and slow down slightly in your 30s. However, many people who are already in their 30s are failing to afford the lifestyle they thought would. Adults in their 30s are failing to manage their finances and owning a home has become a distant dream for many. A real estate agent from Orlando Freddie Smith took to TikTok to express his concern about the current scenario. "My biggest concern with our country turning into a renters’ economy is: how will the millennials and Gen Zers retire comfortably if they don’t own a house and are going to have to rent forever?" he said in a recent TikTok. 

Image Source: TikTok | @fmsmith319
Image Source: TikTok | @fmsmith319

Smith also wonders if the next generation will be able to retire at all. He goes on to explain the math in the video and shows how it simply "doesn't add up." According to the Federal Reserve, the median price of a home in the U.S. is around $400,000 in 2024 and Americans simply cannot afford that these days, as per Smith. He says that at this point Americans need to be prepared to pay $80,000 to hit the recommended 20% down payment. According to the Bureau of Labor Statistics, the median yearly earnings for 25- to 34-year-olds is $56,160, which means that setting aside that amount is very hard for most young Americans. 

TikTok | @fmsmith319
TikTok | @fmsmith319

This is why most Americans resort to renting homes. As per Smith, renters pay an average of $1,950 per month. Then, Smith talks about what would happen if the home prices and rent continue to rise at this pace. Smith shows the rent prices will be 4.3 times higher in 2024 compared to 1994 ($1,950 per month in 2024 compared to $450 per month in 1994) and assumes that even after three decades, the rent will be increasing at the same rate that it is today. At this rate, the mean rent all over the country would be around $8,500. While the numbers are steep, Smith says that it's not long before we get to see this price as rents are already well over $4,000 in New York.

TikTok | @fmsmith319
TikTok | @fmsmith319

This is where Smith gets worried. "How do you retire if your rent’s going to be $8,500?” Smith asks. There is no denying the fact that being able to retire has become a luxury that only a few can afford in the US. Smith also talks about how many people who had bought their homes back in 1994 have been able to sell their homes at three times the original price. Smith then points out how the younger generation will not be able to do that as they are failing to reach the kind of financial freedom needed to buy a home early in their lives. 


@fmsmith319

How will Millennials and Gen Z retire in renters economy? 🤔🏡

♬ original sound - Freddie Smith

 

"This is a major concern," he says. "How can you give the millennials and Gen Z and Gen Alpha hope about the future? Lastly, Smith talks a bit about what needs to change. He places a bit of blame on institutional investors like hedge funds and says that there need to be "systems" put in place to help Americans with their retirement plans

For more Real Estate Content Follow @fmsmith319 on TikTok.

MORE ON MARKET REALIST
The person who originally listed the property later explained the logic behind the design.
32 minutes ago
Later, she finally found a way to get rid of the Tahoe after three years of paying $1,400 a month.
12 hours ago
A study highlighted the alarming number of bacteria found on a large package from Amazon.
20 hours ago
So far the recall hasn't been directly linked to the salmonella outbreak caused by eggs from another brand.
23 hours ago
The employer was overwhelmed after learning about the struggles of his employees.
1 day ago
The video gained so much popularity that some users even advised Amazon that it could be their next commercial.
1 day ago
The transit worker and her husband still haven't decided what they intend to do with the winnings.
1 day ago
Vanna White herself feels that Maggie Sajak has her father's charm and can be a fitting replacement for her.
1 day ago
Markle had even shared that she wasn't fond of her stint as the "Briefcase Girl" on the show.
2 days ago
The photographer also charged extra to edit the pictures although he too had missed the flaw.
3 days ago
The woman revealed that her aunt received the artwork as a gift to thank her for a pillow.
4 days ago
At the peak of his career, Jones reportedly made over $7 million in one season of "Two and a Half Men"
5 days ago
While it's not clear if Jay-Z was describing a hypothetical situation or a real one, the clip gained enough traction.
5 days ago
The content creator also started a GoFundMe page for the cashier to raise more money to reward her.
6 days ago
The celebrity wanted to help women in the criminal justice system who face unique challenges.
Nov 27, 2024
The rapper says people can find all the wisdom in his music.
Nov 27, 2024
The man, who bagged over $180,000 due to an HR error, was told to return the money, but he had other plans.
Nov 25, 2024
Before he joined 'The Price is Right' Carey also played a fictionalized version of himself in a show.
Nov 24, 2024
The large rock was later marked as a national treasure of Romania and placed in a museum.
Nov 24, 2024
Despite numerous warnings, '1234' remains the most common four digit passcode.
Nov 24, 2024