New report: Millennials can’t afford Denver homes

Denver skyline

Look around at the bike stores, pot shops and dog parks: Denver is millennial-Central.

But the Bloomberg Millennial Housing Index raises the question about where millennials are living given that most can’t afford to buy a house in the Queen City of the Plains.

The median home value in Denver is $311,525, according to the index. But the average millennial, 18 to 35 years old, is bringing in $39,492 a year – $2,620 short of the $42,112 salary needed to buy a home.

In fact, Denver is the 12th toughest city in the U.S. for a millennial to buy a house, according to the index. The No. 1 toughest market: San Jose, California. There a median home price of $924,825 starkly contrasts a relatively low median millennial earning of $53,215. The San Jose earnings-gap: $80,162.

Four other California cities – San Francisco, Los Angeles and San Diego and Sacramento – top the index. In all but Sacramento the median cost of a house is well over $500,000. In those cities, millennials are earning a median salary that’s between $36,084 and $80,162 less than they need to buy a home.

When Californians migrate to Colorado – after living in these hyper-expensive California cities – they think Denver’s market is a deal and jack up our ever-rising home prices, a phenomenon The Denver Post reported on as early as 2009.

If you’re in search of a more affordable city to be a millennial, you might consider Detroit, Buffalo, Pittsburgh, Cleveland or Indianapolis, where those in the age group earn a median income between $18,700 and $21,207 higher than they need to buy a house.

Check out this chart from Bloomberg Business outlining the 50 biggest cities in the United States and where they stand.

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Photo credit: Larry Johnson, Creative Commons, Flickr