Non-homeowners in SF could spend $2.5 million in rent by age 60

A for lease sign is posted in front of home for rent in San Francisco, California. A for lease sign is posted in front of home for rent in San Francisco, California. Photo: Justin Sullivan/Getty Images Photo: Justin Sullivan/Getty Images Image 1 of / 18 Caption Close Non-homeowners in SF could spend $2.5 million in rent by age 60 1 / 18 Back to Gallery

The consequences of not being able to afford a house in San Francisco are rather depressing.

A new report finds that those who put their money into rent rather than home equity blow an estimated $2.5 million between the ages of 25 and 60.

The study by the personal finance site Go Banking Rates looked at how much someone who starts paying rent at 25 would spend by ages 30, 40, 50 and 60 in America's 25 most populous cities.

Not surprisingly, notoriously expensive San Francisco is the city where you will pay the most rent, followed by Los Angeles ($2.18M by age 60), Seattle ($2.15M by age 60), and San Jose ($2M by age 60).

This news could be particularly pertinent for the Millennial generation that has struggled to get a piece of the housing market, especially in the San Francisco Bay Area where the median home price is $820,000.

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A survey from Apartment List in 2017 revealed 80 percent of Millennials said they wanted to buy a home, but the majority of them had saved less than $1,000 to put toward a down payment on a house.

Americans across time have generally bought their first home by their early 30s, but a number of reports has revealed today's under-35 generation is saddled with student loans and faces low housing inventory along with rising interest rates and home prices.

That said, Go Bankings did find some cities where the cost to rent is much less shocking. Detroit was the cheapest, with $502,740 being the estimated amount you would spend on rent between age 25 and 60.

To determine the cost of renting in cities, Go Banking used data on median rental prices from Zillow. The one-year average rental price was calculated for each city by averaging the rental cost from February 2017 to February 2018, and then researchers determined the year-over-year percentage increase and extrapolated out the number of years to come up with how much one will pay rent by age 30, 40, 50 and 60. (Note: The study assumes that rental prices will continue to consistently rise at the current rate over a 35-year period of time.)