By Jake M.
The University of Michigan in 2015 conducted a study that demonstrated car ownership and its declining rates throughout America, yet over 90 percent of the studied households still owned a vehicle. It's common knowledge that owning a car plays a large part of people’s daily lives and routines and we see that more and more each day. Carpooling or ridesharing are transportation means that are certainly more popular among Millennials than they are with those in older generations, however a large amount of them are still purchasing vehicles.
Credit Karma provided information in which they studied their users, finding that of their 45 million members, 36 percent of them were Millennials that had current car loans; in other words those between 18 and 24-years old owned money towards a vehicle.
Millennials find themselves trying to survive in a difficult economy, and as the old hand-me-down cars and junkers seem to fit better within their budgeted amounts, Credit Karma was still interested in determining the most expensive places in America for Millennials to buy cars from a list of America’s 100 largest cities.
“We did this by looking at the average outstanding auto loan balance for Credit Karma members between the ages of 18 and 34 who live in these cities and have car loans and assumed a 5.89 percent interest rate, typical for someone with an average credit score in America, and 67-month repayment term – the average loan term for a new car.”
While assuming each person drove roughly 15,098 miles per year, and getting 24.1 miles per gallon, they used a tool at Gasbuddy.com to find the current average gas prices per each major city.
They found Texas was at the top of the list for most expensive places to own a vehicle. Of the top 10 cities in America, four of them ranked as most expensive to buy a car, all being in Texas: Laredo, Corpus Christi, El Paso, and Lubbock. With those in in the top 10, there were three cities in California and two cities in Nevada; this seemed to be affected because of the higher gas prices in these states and cities. On the other hand, the cities that ranked least expensive including; Minneapolis, St. Paul, Madison, Detroit, and Cleveland (all in the Mid-west).
Final TOP TEN MOST EXPENSIVE PLACES FOR MILLENNIALS to purchase a car:
Laredo, TX, $524.30
Corpus Christi, TX, $498.71
Henderson, NV, $478.82
Anchorage, AK, $476.63
Bakersfield, CA, $475.68
El Paso, TX, $473.63
Chula Vista, CA, $463.55
Las Vegas, NV, $461.70
Riverside, CA, $454.55
Lubbock, TX, $454.34
***These numbers were studied and taken into consideration in December of 2015, so more than likely, there are adjustments that would be made or updates if this study was performed again.