There are certain things in life that will always be a mystery and where Millennials and even more mysterious, where Gen Z will want to live and what types of housing will they want to live in is one of those mysterious things builders and developers are still trying to understand.
Millennials in the U.S. are looking to pack their bags and move to a different city where they actually want to live in an urban environment. Cities like Nashville, Tennessee; Seattle, Washington; Raleigh, North Carolina; Washington, D.C.; Denver, Colorado; Orlando, Florida and Phoenix, Arizona are proving to be some of the top places to move to for Millennials.
A recent study published in the Journal of Regional Science found millennials aged 25-34 were the major driving force in the urban revival of the past two decades and prefer living in central urban neighborhoods significantly more than previous generations.
The oldest millennials, in the 34-38 age group, however, are moving away from cities and seeking a more suburban lifestyle. As millennials look to put down roots and start families, they’re saying goodbye to big cities and settling in small towns.
The transition from urban to suburban to small towns seems to correlate to Millennials wanting homes to raise their children. Age and financial security are the driving forces.
Moving on to Gen Zs, those born between 1997 and 2012, found they also want an urban lifestyle but their choice of cities is slightly different. Atlanta, GA; Minneapolis, MN, Boston, MA; Tucson, AZ; Raleigh, NC; Columbus, OH; Seattle, WA and Austin, TX is their current top cities.
Based on information from the US Census Bureau:
Age Range (Years) % of Homeowners % of Age Group Under 25 0.80% 24.80% 25 – 29 3.10% 35.80% 30 – 34 5.90% 49.20% 35 – 44 15.70% 62.00% 45 – 54 19.00% 70.60% 55 – 64 23.40% 75.10% 65 – 74 18.50% 79.50% 75+ 13.60% 79.10%
Millennial potential homeowners have spent much of their adult lives in periods of economic uncertainty while the average worker’s earnings steadily lost value with inflation and reduced benefits. These financial struggles and more significant student loan debt may deter potential homeowners from buying. Even if they are eligible for a home loan, taking on more outstanding debt can be intimidating.
If they could choose, most would prefer to own a home or have the option available to them in the future. Over 75% of prospective homeowners of all ages have consistently indicated homeownership is part of their dream. However, younger generations are becoming increasingly disillusioned with the idea of homeownership.
The last decade also saw an increased number of adults, especially Gen Zs, living with their parents. These individuals are usually not counted in studies as homeowners or renters. If this growing population segment had been included in surveys, homeownership rates in the United States might have been even lower.
Gary Fleisher is the Editor in Chief of Modular Home Source and Offsite Builder. Email at [email protected]
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