Homebuyer Blues

This is how long millennials have to save to afford a home in Dallas

Dallas home, 8335 Banquo Dr., home for sale

Dallas millennials plan on buying a home — but few can afford it.

Photo courtesy of Ebby Halliday Realtors

Buying a home in Dallas is increasingly challenging. There aren't many starter homes available, and even if there were, a new report says millennials wouldn't be able to snag them.

As part of an annual survey, Apartment List questioned millennial renters across the country about their plans for homeownership. The Dallas metro area lines up with the national trend: A lot of young people want to buy a place, but they can't afford to right now, and they may not be able to any time soon.

Eighty percent of metro-area millennials plan to buy a home, but most say they need at least three years to prepare. Affordability is cited as the main reason for holding off, and local millennials aren't underestimating what it will take to buy a home. Survey respondents think they need $19,885 for a down payment, and Trulia says they're correct. First-time buyers should have $19,750 in the bank, 20 percent of the median price of a Dallas-area starter home.

These perspective homebuyers have a long road ahead. Local respondents report having $2,689 in savings, with plans to contribute $208 each month. Based on the savings rate and down payment requirements, they'll need to save for six years to buy a home.

Apartment List says there's a disconnect between millennials' homeownership dreams and reality. "Many do not seem to realize their financial predicament — 3 in 4 renters plan to purchase a home within the next five years, but their savings trajectories suggest that they may need a decade or more to afford it," says Apartment List.

The delay in first-time home purchases is part of what Apartment List calls an ongoing affordability crisis that is shaping the future of the housing market.

"Some may choose to delay settling down and having children, while others will migrate to family-friendly cities on the interior of the country. Given the size of the millennial population, either scenario will have a profound impact on homeownership and renting in our society."

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No Cap

Dallas was a top-10 destination for Gen Zers on the move for 2023

Photo by Lance Asper on Unsplash

Who wouldn't want to live in a Gen Z paradise like Dallas?

As Gen Z enters adulthood, many are flocking to the nation's biggest cultural hubs like New York City, Los Angeles — and now Dallas, which had the ninth-highest inflow of Gen Zers in 2023.

Dallas' new reputation as a Gen Z hotspot was unveiled in a recent report by American home improvement brand This Old House, which analyzed migration trends across multiple generations using 2023 U.S. Census Bureau data.

Dallas saw an influx of 13,770 Gen Z residents last year to become the generation's No. 9 most popular city. That's 4,223 more Gen Zers than the net migration rate from 2022, the report found.

Real estate marketplace Zillow seems to agree on a statewide scale, declaring Texas as the No. 1 destination for Gen Zers on the move in 2024.

However, as Gen Z Dallasites may have learned, it's going to take a big bite out of their paychecks to live in such a highly sought after city. A March RentCafe housing cost analysis predicted Gen Z adults living in Dallas are likely to spend over $149,000 on rent by the time they are 30 years old.

While Dallas saw big gains in its Gen Z population last year, many other big cities saw a mass exodus. Plano, for example — which gained 1,295 Gen Z residents in 2022 — lost 4,028 Gen Zers in 2023, the report discovered.

The biggest Gen-Z exodus was in El Paso, with a drop of 5,607 — "a sharp turn from 2022 when the city saw an increase," the report said. "Other cities, including Plano, Texas; Memphis, Tennessee; McKinney, Texas; and Wichita, Kansas, are seeing similar declines."

"Gen X, baby boomers, and the Silent Generation are also moving away from major cities, particularly New York City and Washington, D.C.," the report said. "They’re heading to some of the same cities as Gen Z, including Houston and Jacksonville, Florida."

The top 10 cities that gained the most Gen Z residents in 2023 are:

No. 1 – New York City, New York
No. 2 – Los Angeles, California
No. 3 – Houston, Texas
No. 4 – Philadelphia, Pennsylvania
No. 5 – Chicago, Illinois
No. 6 – San Diego, California
No. 7 – Seattle, Washington
No. 8 – Charlotte, North Carolina
No. 9 – Dallas, Texas
No. 10 – Minneapolis, Minnesota

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