San Diegans who are between 25 and 30 years old may be graying by the time they can save enough to buy a median-priced home here.

A study released Wednesday by real-estate tracker Trulia says it would take 18 years for a San Diego household of college-educated young professionals earning the median income to afford a median-priced home in the county.

More specifically, a household earning $89,000 per year that can save 10 percent of its income for 18 years would then have enough money for the standard 20 percent downpayment on a median-priced home of $589,000 in the county, Trulia says. San Diego ranked as the nation’s fourth most difficult city to save to buy a home.

“They may be somewhat depressed by the fact that our study shows it takes 18 years for a median household, but you can make adjustments,” said Ralph McLaughlin, a Trulia economist. “You can go for a lower priced home, you can save more. ... The other option is to put less than 20 percent down, which is becoming increasingly more common than it was 20 or 30 years ago.”


Trulia assumed that each household owed $280 in monthly student loan debt payments that ate into their savings. It also assumed a household would be able to save 10 percent of its income annually, despite rising rents and the Bureau of Economic Analysis reporting that the national savings rate in May was about 5 percent.

Rents in the county have been rising about 3 percent per year, with the average expected to reach more than $2,000 a month by 2020, CBRE reports. Wages have not kept pace, rising about 2 percent annually, continuing to eat into potential savings.

“The cost of living is so high here, particularly rents,” said Alan Gin, economist at the University of San Diego. “Americans have among the lowest savings rates in the world, because we’re a consumer society.”

At current prices, it would take 13 years for a typical household that saves $8,900 per year to have the $117,800 required for a 20 percent downpayment on a $589,000 home. However, Trulia used a formula to estimate how much home prices and incomes would increase over time, and found that it would take 19 years in San Diego County before the gap is closed enough for such a large down payment. That’s because Trulia projects that incomes will ultimately rise faster than home prices, which have been slowing recently.


Lynn Reaser, chief economist at Point Loma Nazarene University, said there are ways to accelerate the path to becoming a homeowner.

“Wise investing, involving a diversified portfolio, could help cut down significantly on the time necessary to earn the necessary downpayment,” she said. “Young people may also have to settle for a less expensive home or condo as their first owned residence than that with the median price.”

For those who wish to make a 10 percent downpayment, Trulia reports that a college-educated household of 25- to 30-year-olds would need to save that same amount for nearly 11 years.

Without a college degree, Trulia says would take 29 years of savings to generate enough money for a 20 percent downpayment, and 12 years for a 10 percent downpayment. Trulia says that in some cities, like Las Vegas, Columbia, S.C., El Paso, Texas, and Daytona Beach, Fla., it’s better not to have a college degree because student loan debt payments outweigh the income benefits of higher education when it comes to buying a home.


San Francisco is the most difficult place to save for a downpayment, with a median-priced home costing $1.74 million. There, it takes 29 years to save for a 20 percent downpayment if a household has a college degree, and it would be impossible if there are no degrees. San Jose and Los Angeles round out the top three. It’s easiest to save for a 20 percent downpayment in Detroit, where it would take four years to save enough for a median-priced home of $103,890.