In an interview with Australia's "60 Minutes" on Monday, Tim Gurner, a 35-year-old real estate mogul in Melbourne, suggested that young adults would be more likely to be able to buy a home if they curbed their discretionary spending, citing that expensive brunch item.
"When I was trying to buy my first home, I wasn't buying
"The people that own homes today worked very, very hard for it," he said, adding that they "saved every dollar, did everything they could to get up the property investment ladder."
The advice spread on social media, and it was not well received. Some found the statement impractical or insulting.
In fact, research suggests that people from 18-to-34, a group often referred to as
According to the Food Institute, which analyzed Bureau of Labor Statistics expenditure data from 2015, people from 25 to 34 spent, on average, $3,097 on eating out. Data for this age group through the decades was not readily available. But the bureau's report indicated that this group spent $305 more than people from 55 to 64 — a group that encompasses some baby boomers — and $89 more than the overall average, including spending among people ages 35 to 54.
The truth is, even if millennials assumed the eating-out habits of baby boomers, it would take around 113 years before they could afford a down payment on a home (assuming a 20 percent down payment on the median price for a home in the United States, $315,000 in March 2017, and a one percent yearly yield rate).
Yes, you would surely save money by choosing to make your own avocado toast at home (perhaps with some cucumber soup).
The average price of a single avocado in March was $1.25, according to the Hass Avocado Board. One Twitter user calculated that a serving of avocado toast cost her about $1.65 — or one-477,896th the average price of a home in Brooklyn. Compare that with New York City brunch prices, where you are likely to spend $10 to $20 for ornately dressed toast, and the savings are clear.
But all generations of Americans are eating out more now, with food away from home rising to 43.1 percent of food expenditures in 2012, from 25.9 percent in 1970. It is not clear if millennials are driving that trend.
As for Mr. Gurner's second suggestion — skipping the European vacation — there is indeed an opportunity for savings, but research suggests millennials are the generation spending the least on travel.
Millennials spent $4,832 per year on vacations, just below the $5,078 by Gen-Xers and $5,012 by boomers, according to MMGY Global's Portrait of American Travelers in 2016. The study surveyed 2,948 adult travelers with annual incomes over $50,000.
Millennials were less likely than older generations to say they were cutting back on travel because of budget concerns but were also more likely to have difficulty getting time off work. They were also more likely to say they were too busy to get away.
Another wrinkle in pitting age-specific preferences against buying a house: Homeownership is historically lower among young adults and has declined across most age groups since the 2008 financial crisis as the ratio of home prices to median household income has climbed.