Most millennial-aged Americans struggle with a unique economic background, especially since most 18-36-year-olds have some sort of student loan debt. This means more millennials are choosing renting over buying a home, looking for affordability when choosing a place to live and looking for the most viable market for their industry of choice.
The top two reasons millennials choose an area to live comes down to the job market and affordability, according to the recently-released National Association of Realtor’s 2019 report, “Most Popular Areas for Millennials: where they move and stay.”
“The report analyzed employment gains, population trends, income levels and housing conditions in the largest 100 metropolitan statistical areas across the country to identify the most popular areas for millennials,” the report states. “The top 10 metro areas were selected because of their high share of both present millennial residents and recent movers, as well as their favorable employment opportunities.”
Madison, Wisconsin, was deemed one of the top millennial destinations by the report due to recent statistics showing that 75 percent of the recent movers to the city have been millennials.
Lawrence Yun, NAR’s chief economist, said in a release that Madison has many attributes that appeal to millennials, including earning potential. As of 2017, the median income for millennials there was $62,000, and $68,500 for millennials who had recently moved to the city, according to Yun.
“In comparison to other areas, Madison offers one of the highest wages for millennials,” Yun said. “Moreover, this income level combined with the robust employment opportunities and the affordability, make Madison among one of the most appealing locations for millennials who are looking to stay longer and raise families.”
California is another hot spot for millennials searching for the best bang for their buck. Bakersfield, which is between San Francisco and Los Angeles has about a 28 percent millennial population. About 67 percent of millennials moved to this area due to its affordability.
He says Bakersfield’s affordable homes makes it inviting to millennials. Of the millennials who most recently moved there, they can afford to purchase nearly 15 percent of the homes listed for sale. This is in comparison to neighboring Los Angeles where millennials can only afford to buy 4 percent of listed homes, according to Yun.
“The increasing employment rate in California is another strong selling point among this generation,” Yun said. “While the rate of unemployment in Bakersfield is higher than it is nationwide, we’re seeing job growth there pick up at a strong pace. Home building in Bakersfield is rising, too. Many newcomers to San Francisco and Los Angeles do not stay for long because of lack of affordability. Millennials moving to Bakersfield meanwhile are looking to take advantage of conditions toward home ownership.”
The report found that one out two people who moved to one of the top 100 metro areas in the U.S. was a millennial — about 54 percent — and in those top 100 metro areas, one of four residents was a millennial.
“In the top 10 metro areas, millennials can afford to purchase, on average 17 percent of homes currently listed for sale,” the report states. “In 2017, affordability was low in most of the areas that millennials moved to that year. The median income for millennials who recently moved in the 100 largest metro areas was $53,000. Millennials who moved recently in these areas can afford to purchase nearly one out of four of the homes currently listed for sale (23 percent).”
Sources: prnewswire, nar.realtor