It’s no mystery that Millennials face unique challenges on the homeownership front. From slow wage growth to soaring student debt burdens, economic forces have kept Millennials on the housing sidelines, and a huge share still live at home with their parents.
Those details are well known, but what is less reported is how much Millennial homeownership has fallen in the post-bubble housing market. A recent analysis from Apartment List explores the topic, and has come away with some stark conclusions.
Millennial homeownership on the decline
First, Millennial homeownership has fallen across the board since 2005, in some places by double digits:
| Metro | 2005 | 2010 | 2015 | % Change (’05-’15) |
|---|---|---|---|---|
| Atlanta | 44.0% | 38.9% | 29.9% | -14.1% |
| Boston | 33.6% | 27.8% | 27.6% | -6.0% |
| Chicago | 43.4% | 36.4% | 31.9% | -11.5% |
| Houston | 34.7% | 34.4% | 29.1% | -5.6% |
| Los Angeles | 25.1% | 20.2% | 17.8% | -7.3% |
| Miami | 35.4% | 29.6% | 26.3% | -9.2% |
| New York | 27.9% | 23.2% | 19.8% | -8.1% |
| Philadelphia | 43.0% | 38.2% | 35.8% | -7.2% |
| Phoenix | 41.4% | 37.0% | 30.2% | -11.3% |
| San Francisco | 29.7% | 23.3% | 20.5% | -9.2% |
| Seattle | 32.8% | 30.2% | 29.0% | -3.9% |
Although there is a clear correlation between housing affordability and Millennial homeownership – the rate in Philadelphia (35.8 percent) is much higher than that in pricey San Francisco (20.5 percent) – rates are still down markedly over the last 10 years, including a pronounced 14.1-percentage-point drop here in Metro Atlanta.
Millennial income on the decline
We’ve reported before about how wages have either stagnated or declined for Millennials, and Apartment List’s analysis shows how Millennial incomes have fallen, as a result:
| Metro | 2005 | 2010 | 2015 | % Change (’05-’15) |
|---|---|---|---|---|
| Atlanta | $65,615 | $57,806 | $60,219 | -8.2% |
| Boston | $75,326 | $73,935 | $78,800 | 4.6% |
| Chicago | $66,395 | $62,069 | $63,153 | -4.9% |
| Houston | $56,681 | $58,633 | $61,465 | 8.4% |
| Los Angeles | $62,894 | $61,621 | $62,544 | -0.6% |
| Miami | $52,295 | $49,296 | $50,441 | -3.5% |
| New York | $68,107 | $67,312 | $68,743 | 0.9% |
| Philadelphia | $64,995 | $63,147 | $65,123 | 0.2% |
| Phoenix | $58,404 | $54,766 | $55,547 | -4.9% |
| San Francisco | $79,348 | $79,377 | $88,518 | 11.6% |
| Seattle | $66,702 | $68,574 | $75,331 | 12.9% |
One thing is immediately clear, upon examining the above chart – incomes have not fallen for all Millennials, and in places like Houston, San Francisco and Seattle, they have risen strongly.
However, even with those increases, the Millennial homeownership rate has continued to decline, suggesting that other factors have conspired to prohibit Millennials from buying homes.
A Millennial exodus
Finally, with Millennial homeownership on the decline, the assumption would be that many of those individuals are transitioning to renting and remaining within their respective metro areas; unfortunately, Apartment List’s final piece of data, which examines Millennial populations, blows that idea out of the water:
| Metro | 2005 | 2010 | 2015 | % Change (’05-’15) |
|---|---|---|---|---|
| Atlanta | 472,409 | 414,990 | 402,629 | -14.8% |
| Boston | 338,078 | 341,899 | 323,623 | -4.3% |
| Chicago | 755,609 | 701,912 | 654,684 | -13.4% |
| Houston | 477,197 | 485,950 | 519,812 | 8.9% |
| Los Angeles | 930,721 | 846,659 | 783,629 | -15.8% |
| Miami | 348,226 | 295,421 | 304,540 | -12.5% |
| New York | 1,220,127 | 1,208,601 | 1,157,296 | -5.1% |
| Philadelphia | 407,797 | 401,807 | 372,497 | -8.7% |
| Phoenix | 383,617 | 336,591 | 327,949 | -14.5% |
| San Francisco | 308,887 | 312,536 | 306,729 | -0.7% |
| Seattle | 299,337 | 308,481 | 319,893 | 6.9% |
Consistent with the previous chart, Houston and Seattle are outliers, but even in other markets where wages grew (such as San Francisco) and market with famously affordable housing markets (Phoenix and Atlanta), populations declined.