In my part of the NYC suburbs, rent for a one bedroom approaches $2K per month! Tough on a teacher’s salary for one of my kids. He wanted to live alone and have public transportation so found a slightly lower price. He doesn’t have a car, which would have been another $125 per month to park.
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S2 and DiL have rented a one bedroom, about 600 sq ft apartment in a complex of 4 buildings built in the 30’s. The walls are so thick they can only get a cell signal by the front door. Rent is about 45% of their combined income, yet they have saved up almost 15% of the median 2 bdr house for their area— and that won’t be enough. Houses without structural damage or location issues are going for about 20% higher than list and concessions. And that’s if you can even find one.
They’ve lived in their old, tiny, mouse-visiting place for 6 years, with no exit door in sight. They thought of moving to a nicer, newer place but decided it wasn’t the best use of their money. For vacation, they come live at our house while we travel to care for my folks. I don’t know what else they could possibly do.
@twoinanddone - where did your daughter buy here house? I’m just curious which places our kids can buy houses.
@HImom - my friend’s S just moved from San Diego to Fontana where he is renting a room from his cousin that bought a house there. I grew in Riverside which is just over 10 miles from Fontana. I really could not imagine myself living in this area again, but I do understand young people wanting to buy a place. If they have to commute into LA though it is not going to be fun.
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D moved to Columbus Ohio for her residency in 2020 during the pandemic. She knew she wanted to buy a place, especially since she’s there for several years. She bought a townhouse a couple of months after she moved - best decision she’s ever made. At the time she bought, people were paying over asking price and all cash offers were very common. The condo has appreciated quite a bit in less than 2 years.
S is in Boston - no way he can think of buying a place there. We’ve been thinking of buying a second place - if we do end up buying in the Boston area, he would gladly live there and pay rent 
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Georgia may not be the most attractive place to live among the CC crowd but, if your job takes you there, housing is still very affordable throughout the state. This is an example of a house in our son’s neighborhood, similar to his but smaller lot:
The schools are good, all major retailers are nearby, Augusta University medical system is excellent, and the Augusta National is just up the road. He really enjoys living there.
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I would expect that nearly all recent grads rent.
One issue is how long your child expects to stay in one location after graduating university. Sometimes the first job works out for a long time. More often it does not.
I think that this web site has an above-normal number of participants who could afford to help their kids purchase a home, but also has an above-normal number of participants whose kids are likely to end up in graduate programs. If you are only working for a year or two before heading off to graduate school, you might not expect to be in the same place long enough to make purchasing a home sensible.
And sometimes the first job just turns out to not be the right one for the long term.
In terms of how difficult it is to purchase, this will depend upon location. Where our kids are, there is no way that they could afford to purchase without significant help from the bank of Mom and Dad. However, this particular bank of Mom and Dad does recognize that having a hedge against inflation is a good idea right now, and a home is usually a very good hedge against inflation. This just doesn’t apply to us right now because we do not believe that our kids are going to stay in the same place long enough to make purchasing worthwhile.
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D does admit that where she lives is further away from friends than she’d like but she doesn’t have to commute and they all like having a newer place to live with laundry facilities and everything working. She pays about $1000/month for renting her room in the house, which I believe includes all utilities and parking.
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My 26 yr old bought a very nice condo in the major city where we live in the suburbs. It was pricey but he locked in with a good rate and he put 30% down. He has a very high income which includes large bonuses. He’s frugal and worked way too many hours for the first 2 years out of undergrad to spend it and then a year later the pandemic hit and that was a forced savings. His friends have bought similar places here as well as in other- and more expensive- cities. Again, high earners and probably none ever had student loans.
The prices that I see for CA homes really do blow my mind. My friend in SoCal recently told me her home could probably sell for north of $3mil. She said the only way her kids ( who have good jobs ) will be able to afford anything there is if she and H help with down payments. CA would be a difficult place to leave!
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That house would be 1.5 million in my town ( maybe more). GA is very inexpensive.
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Depending on what’s the inside of the house looks like, it would be anywhere from $2M to $2.5M here south of us.
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Littleton, CO (outside Denver). She really wanted a mid-century modern house in Denver but they were, at the time, about $750k and their budget was $450k. They ended up spending almost $600k for a 1970s boxy house but it has a big family room and that’s one thing they wanted, and it is in suburbia, not the city. They have 2 dogs so needed a yard. i think they regret being so far south now.
The houses in my neighborhood were priced at $450k about 18 months ago (many identical floor plans and all built in the 1950s) and now are going for $740k! It’s really crazy. Many are being bought by flippers who pay cash so the ‘regular people’ don’t really have a chance. They are listed and sold by the end of the weekend. We don’t really want to live in a neighborhood of renters, but that’s what it is turning into.
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My 26YO in the Chicago suburbs has been renting a room in a townhouse (one roommate) since she graduated. She is frugal and has a good salary, and has saved a ton of money. She could buy a house if the wants.
My 24YO got married in 2020 and she and her H bought a nice starter home in a good neighborhood in Tucson in 2021. The market was very hot and they got outbid a number of times before landing this house. They’re both in grad school now and can afford to live there on their combined salaries. The house has increased in value since then. That same house would cost twice as much in our city in the Phoenix metro.
I’m worried my son who has three semesters left of a music Ed degree will be moving in with us to afford housing if he wants to come back here.
None of my kids have student debt. That helps.
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Friend’s kids bought a house on Oahu last year. He’s in the Army so gets housing allowance, but they had to pay 900K for the house, and it’s a small house.
My kid rents a SMALL 2 BR apt in Arlington VA (nice building, close to metro). Rent is 2800 a month. They would like to buy a house within the next couple of years, but housing in suburbs near DC is really high these days. They are trying to figure out how far out is reasonable to consider.
My daughter is kicking around the idea of buying when her first lease is up in August. Or extending it three months while looking. It would be a townhouse, or a small 2BR, but would get into ownership.
My concern is future mobility. How certain can she be that she’ll stay in the area for the several years required to make is worth the one time transaction costs? She’s certain she’s staying with her current employer/job and getting her MBA part time, starting in another 1-3 years. So she thinks she’s committed to being there for at least 5 years.
Rising interest rates and a possibly recession are concerning. I’m thinking it might be better to wait it out a bit, confirm employment isn’t a risk, and maybe even wait for the market to cool and rates to fall a year from now.
So hard to know! Wish we all had crystal balls for these kind of life decisions!
We moved around a ton when we were young. We always bought vs renting. There were only two houses where we lost money. Our very first house and our last one. All the other homes we made money (more than we lost).
Our D will buy once she’s done with her ELDP and has a “permanent” location.
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By historical standards, mortgage rates are still below average. Easy to view them as “high” now because we have had more than a decade of historically low rates.
Some areas of the country have not seen the same price increases as the most common locations for people on this site. Risks of timing market in those areas is greater because recovery time if you do not is much longer.
My son could buy a house but at this point he doesn’t know how long he will be where he is. In next year or so he will have a much better idea and if he stays, he likely will buy a house.
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Well, now, isn’t that a coincidence - while I was reading this thread, D23 sent me a text saying their rent increased $225/mth when current lease ends later this summer. I told her that she actually has a good deal where they are as I don’t think they could find anything comparable w/o paying a lot more. When I said I had been concerned her rent was going to up substantially, she said they cannot raise it more than 10% (she is in San Diego).
D18 just graduated and just signed a lease with two of her college roommates. A very nice 3-bedroom apartment in a very nice area of a large city for what seems like peanuts here in my locale.
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D and her SO are renting a 2BR in the heart of downtown Denver for $2200/mo. They want to buy in one of the trendy neighborhoods, but home prices are rising faster than their salaries.
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