Does the high cost of rent have you down? It turns out it could have a major long term effect on your finances too.

I came across an interesting study last week from Rent Café that says millennials spend about $93,000 on rent by the time they turn 30. The numbers were staggering to me. After all, you can buy a pretty nice house for $93,000 in Emporia, KS.

The study uses statistics from the US Census Bureau to create a national average, so I wondered how those numbers would compare to the cost of rent locally. After all, it has got to be cheaper to rent here than in a metro or on the coast, right? Not so fast!

To try and simplify the method a little bit, I decided to look at local rent listings as opposed to digging through the US Census records for the next two weeks. Using Rent.com and Apartments.com I created a list of all the available listings for 66801. This strategy also led me to several property management companies in Emporia, where I was able to uncover even more listings that I didn’t find on the first two websites.

The list I created includes houses, trailers and condos in addition to actual apartment buildings, so the average numbers cover a very broad spectrum of the rental property market. For apartment buildings that had multiple floor plans available (studio, one bedroom, two bedroom, etc.), I used the average rent of all the floor plans in the building.

With this as the guidelines for our local study I came up with an average rent of $661.13 per month. That comes out to $7,933.56 annually or $79,335.60 over ten years. Granted, many people are splitting rent with a roommate, but even if you cut that in half, imagine having $39,667 in equity in the house you could have purchased.

With the research already in front of me I decided to take one extra step and look at the average rent for the two and three bedroom properties. For this I’m not really as interested in what a young person would spend by the age of 30, but what a family would spend over ten years at any point in their lives. The average comes out to $803.33 per month. That’s $9,639.96 annually or $96,399.60 over ten years. More than enough to purchase a home in Emporia, Kansas.

Many people would say they rent because they can’t afford the down payment on a home. It’s a legitimate argument, but what if I told you there are programs for that such as an 80/20 loan? It’s two loans actually. One for 80% of the purchase price and the other to cover the 20% down payment. The beauty of this program is that you don’t need to pay Private Mortgage Insurance, also known as PMI. This is just one example of an alternative option to a traditional mortgage loan.

To learn more, contact Brandee Ball at 620-342-3523.

About the Author

Story written by Kyle Thompson with contributions from Brandee Ball.

Kyle Thompson began his professional career as a broadcaster in the Emporia area. He has hosted a morning show, various day shifts and anchored local news. He joined Lyon County State Bank in 2014 after graduating from Emporia State University. Kyle specializes in commercial and consumer lending