A poll “Mexican millennials and housing, what do they want and how do they want to live?” Conducted by Vivanuncios revealed that 42% of young Mexicans returned to their parents’ homes when they decided to become independent for the first time: 37% because they lost their jobs; 32% because they didn’t have the economic resources; 21% felt lonely and missed the family; while 10% did not like the experience of living with a roommate.
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Of the more than two thousand young people surveyed, 44% are currently living with their parents; 35% with a partner; 15% with a friend (roomie) and 6% with a family member other than their parents.
These statistics coincide with those collected by the National Survey of Youth 2010, when of the young Mexicans between 20 and 29 years old, 39.8% live with their parents; 28.7% live with their partner; 12.1% only with their mother; 10.1% only with their father; 5.1% with another relative; and only 4.2% live alone.
When asked to whom the dwelling in which they currently live belongs, 41% indicated that it is rented; 40% belongs to their parents; 12% is owned, 4% is owned by a relative; 2% belongs to their partner and 1% is borrowed.
The survey also revealed other relevant data on the economic contribution of young people to the payment of a home. It was discovered that 57% contribute some economic amount for the payment of their home: 21% make the total payment; 15% share the payment with their partner; 14% divide expenses with a roomie; and 7% share the payment with several friends (more than two roomies).
At what age do young Mexicans become independent?
When questioned about what age they consider suitable to leave their parents’ house: 43% of respondents indicated that from 25 to 30 years; 36% said it is better than 20 to 25 years; 10% from the age of 30; 7% indicated that between 18 and 20 years; and 4% indicated that at 18 years of age.
From illusion to reality …
Of the more than two thousand young Mexicans surveyed, 90% have among their short-term plans to leave their parents’ homes to live alone, or else they have already done so on some occasion; while 10% do not consider it.
On the other hand, 35% of the millennials that participated in the survey indicated that, between 25 and 30 years, they went to live alone or that they intend to meet the goal at that age; 31% between 20 and 25 years old; 14% after age 30; 9% between 18 and 20 years old; 6% from 18 years old; and 5% before 18 years.
When asked what is (or was) the reason why they would leave their parents’ house, young people indicated the following: 29% want to live near their place of study or work; 23% for the experience of knowing what it feels like to live alone; 22% because they do not like to depend on their parents; 17% want to live with their partner; and 9% do not like the rules of their house.
Real estate preferred by millennials in Mexico
Regarding the type of housing preferred by the millennials of the country: 44% indicated that the option that adapts to their lifestyle is to buy their own apartment; 21% seek to rent it; 16% want to rent an apartment with a roomie to share expenses; 15% want to rent an apartment with their partner to divide expenses as well; and 4% prefer to rent a room.
Despite the fact that the illusion of young Mexicans is independence, most do not have enough economic resources to pay for housing, a reflection of this is the budget they have to allocate in this area: 34% are willing to pay from 2 to 3 thousand pesos per month; 29% from 3 to 5 thousand pesos; 19% from 5 to 8 thousand pesos; 9% from 8 to 10 thousand pesos; and another 9% more than 10 thousand pesos per month.
These figures reveal a reality supported by INEGI statistics, which indicate that only 4 out of 10 millennials receive a salary higher than 12 thousand pesos a month; even 1% of this population sector does not exceed 2,400 pesos of monthly salary; 30% receives up to 4,802 pesos and 24% reaches 7,200 pesos.
Are millennials planning on buying real estate this year?
Faced with this scenario, 70% of Mexican millennials surveyed by Vivanuncios do not plan to buy a home this year, while 30% do.
Among the reasons why they do not think about buying a house are: because they don’t have the economic resources (55%); because they already have their own home (21%); because they prefer to invest in a business (10%); because they believe that there could be an economic destabilization due to the change of government (9%); and because they prefer the option of renting a home (5%).
Historical low level of homeownership worldwide
“All over the world, we are at the lowest historical level of homeownership. We must not forget that at age 22 it is when we are lucky to enter the world of work, in addition, in 2008 we had a global economic recession, so the purchase of a home today is made, on average, at 35 years of age.
The millennials suffered this recession and had a huge cost to get the down payment for a property, that makes the tendency of purchase against rent is low. The generation before them is one of those with the most owners, especially those who were of purchase age between 2001 and 2006, reaching 70% of owners, versus 35% now,” explains Mariano Balcarce, director of business development of Vivanuncios.
From the point of view of the manager, the millennial generation lives the result of a panorama in which various factors converged, however, they have tools to save and, eventually, acquire a home of their own. In his opinion, young people need to track their expenses to establish a fixed amount of savings and, above all, they need to invest their money.
“It is very important to understand the power of compound interest, which really shows you how you can put your money to work and watch it grow. When you earn interest on savings, these interests, in turn, earn interest on themselves and that amount is capitalized monthly. The higher the interest, the more your money will grow! Just imagine that with the bonus and some savings you can collect 50 thousand pesos, that will give you a monthly savings of 2,000 pesos with an interest of 10% per year: in 7 years you would achieve 325 thousand pesos. Not bad,” Balcarce finished.