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Indianapolis is emerging as one of the most accessible housing markets in the nation for young people. This is due in part to relative affordability. A recent report from LendingTree reveals that Generation Z, those born between 1997 and 2012, accounted for over 20% of mortgage requests in Indianapolis last year.
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This statistic places the city alongside a select few markets, including Salt Lake City, Oklahoma City, Birmingham, Cincinnati, and Louisville where young buyers displayed similar levels of interest in homeownership.
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Historically unaffordable cities like San Francisco, New York, and Los Angeles saw Gen Z accounting for less than 10% of mortgage requests. However, Indianapolis offers a more feasible option. Although housing costs in the city are rising, they remain more affordable than in many other major cities.
Housing Markets for First time Home Buyers:
Nationwide, the share of first-time buyers has reached a record low due to ongoing inventory shortages and affordability concerns. Additionally, potential buyers are waiting longer to enter the market, as the median age of first-time buyers has risen from 33 to 36. These factors have led to a general perception that now is the worst time to purchase a house.
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When comparing Gen Z to previous generations, some positive trends emerge. According to Redfin data, 30% of 25-year-olds owned their homes in 2022, compared to 28% for millennials at the same age. While housing affordability challenges persist, Indianapolis offers a more favorable starting point for first-time buyers. This allows them to enter the market more easily compared to other cities.
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It is important to acknowledge the broader economic factors impacting housing affordability nationwide. These factors include high home prices, rent, interest rates, and slow construction. All in all, Indianapolis stands out as a city where young buyers have a lower barrier to entry. This enables them to achieve their homeownership dreams more readily.