A recent study by LendingTree has placed San Diego in a challenging position for young adults hoping to enter the housing market, ranking it as the sixth-worst metropolitan area for homeowners under 30. The analysis indicates that a mere 1.7 percent of homeowners in San Diego County fall into this age bracket, significantly lower than other major cities like San Jose (0.8%), New York (1.2%), Los Angeles (1.3%), Boston (1.4%), and Sacramento (1.6%).
The study, which examined anonymized credit reports from the 50 largest metropolitan areas in the United States, highlighted that on average, only 3.1 percent of adults under 30 have mortgages across these metropolitan regions. Furthermore, although young adults represent 20.3 percent of the adult population, they account for only 4.7 percent of mortgage holders.
Nationally, those aged 18 to 29 owe approximately $527 billion in mortgage debt, contributing to just 4.2 percent of all mortgage debt. This points to a troubling trend for the younger demographic as they grapple with financial barriers to homeownership.
LendingTree found several reasons contributing to the obstacles faced by young homebuyers in San Diego.
Firstly, the soaring home prices are a significant hurdle. The median home price in the San Diego Metropolitan Area has reached a staggering $905,463, which represents a 7 percent increase from the previous year. To afford a home at this median price, potential buyers would need to generate an annual income of $242,560, which is notably higher than the county’s median household income of $108,000.
The report indicated that 41 percent of homes listed for sale are sold for more than the asking price, something that makes the purchase process for younger buyers all the more confounding. A limited housing supply also contributes to the difficulty, making it even harder for first-time homebuyers to find affordable options.
