The
upfront
cost
of
homeownership
can
be
a
difficult
prospect
even
for
households
with
higher
income
levels.
A

study
released
Wednesday
by
personal
finance
website

BadCredit.org
illustrates
that,
in
some
states,
it’s
next
to
impossible
for
minimum-wage
workers.

To
calculate
the
amount
of
time
it
takes
minimum-wage
workers
to
save
for
a
down
payment,
the
company
analyzed


Zillow‘s
median
values
for
single-family
homes
and
condominiums
from
May
2023
through
April
2024.
It
then
correlated
this
data
to
the
minimum
wage
in
each
state,
according
to
the


U.S.
Department
of
Labor.

BadCredit.org
assumed
an
8%
down
payment
—
which
is
the
typical
amount
for

first-time
buyers,
according
to
the


National
Association
of
Realtors
—
along
with
saving
10%
of
total
income
while
working
40
hours
a
week
for
52
weeks
per
year.

The
company
found
that
at
the
national
level,
the
average
minimum-wage
worker
would
need
about
23
years
to
save
for
an
8%
down
payment.
That’s
based
on
the
federal
minimum
wage
of
$7.25
per
hour
and
a
median
home
value
of
$349,000.

“The
findings
are
a
sobering
reminder
of
the
financial
hurdles
that
low-income
earners
face
in
achieving
the
American
Dream
of
homeownership,” Jon
McDonald,
senior
editor
at
BadCredit.org,
said
in
a
news
release.
“While
we’re
seeing
increases
in
minimum
wage,
such
as
the
recent
rise
for California’s fast
food
workers,
these
steps
are
often
insufficient
to
bridge
the
gap
in
high-cost
housing
markets.”

Naturally,
the
timeline
varies
from
state
to
state.
In
Utah,
it
would
take
a
minimum-wage
earner
34.1
years
to
save
for
an
8%
down
payment.
In
10
other
states
—
including

New
Hampshire,

Idaho
and

Hawaii
—
it
takes
at
least
20
years
to
achieve
the
goal.

“If
a
person
(earning
the
minimum
wage)
were
to
save
10%
of
their
income
starting
at
age
18,
they’d
be
ready
to
pony
up
an
8%
down
payment
by
age
41,”
the
report
explained.
Comparatively,
someone
making
the
median
income,
which
is
roughly
$68,000
in
the
U.S.,
could
achieve
the
same
milestone
in just
5.1
years.”

Even
at
the
low
end
of
the
spectrum
for
housing
prices,
it
takes
the
better
part
of
a
decade
for
minimum-wage
earners
to
afford
a
down
payment.
Illinois
was
deemed
the
least
difficult
state
in
this
regard
at
8.6
years,
based
on
a
minimum
wage
of
$14
per
year
and
a
median
home
value
of
$250,979.
West
Virginia,
Arkansas,
Missouri
and
Ohio
were
next
on
the
list
in
terms
of
shortest
timelines.

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