Manhattan Millennials Who Can Afford to Buy Are Still Choosing to Rent
Young professionals living in Manhattan who have the means to make a down payment on a seven-figure property are still opting to rent. Why make payments towards someone else’s mortgage when you can be paying your own? It’s a lifestyle choice, the Observer notes in a new article exploring the trend. “With their increasingly mobile jobs and lifestyles, successful New Yorkers in their 20s and 30s are shying away from making a commitment to one city, let alone one apartment. And despite Manhattan’s astronomical rents, it’s costlier still to buy here, with the average Manhattan apartment now going for $1.73 million.”
The Observer points towards the entrepreneurial spirit of Manhattanites in their 20s and 30s, leading them to hold onto as much of their hard-earned cash as possible and put it towards starting a business. This demographic also tends to travel a lot, and a migratory lifestyle is much easier to manage when you’re renting. And with the competition of “all-cash international buyers” for condos and the intense scrutiny of co-op boards, renting becomes the easier choice. Neeta Mulgaokar, a real estate broker with Mirador who happens to also be a millennial, told the paper, “A large percentage of my clients are millionaires who are willing to spend large amounts of money every month to avoid the commitment of having to buy. The prices here are so high, and you’re never sure if you’re going to be relocated. I have no desire to buy, and I see renting as a way to preserve my freedom.”
For the baby boomer generation, owning a home was a basic rite of passage into adulthood. But for millennials, the pendulum has swung the other way. In a recent Goldman Sachs study of some of the 75 million Americans between 18 and 34 years old, only 30% said buying a home is important, but even they noted it’s not a priority. Could it be that this generation lived through the financial collapse and is disillusioned? Perhaps it’s the always-on-the-go, tech-driven society that makes commitment seem much more unattainable. This isn’t a national trend, though, so maybe it’s just the cut-throat nature of the NYC real estate market that’s warding off these young professionals.
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