It’s not exactly a new observation that millennials haven’t been very aggressive when it comes to buying homes. Millennials may no longer be living with their parents, but home-ownership trends remain weak for people under 35 years old. SmartAsset has analyzed the homeownership rates among adults under age 35 in the 200 largest U.S. cities.
Of the top 200 cities analyzed, only 42 of those cities saw millennial homeownership rise. Overall, their homeownership rate is down 4.4%. While millennial homeownership is lower on average, there is another side of this trend. There are pockets where more people under the age of 35 own their homes versus those who do not.
The SmartAsset study looked at the current rate of millennial homeownership in 2017 and compared the change in the millennial homeownership rate from 2008.
Before thinking this is an issue based on home values, note that it doesn’t seem to be the only factor. The top 25 cities where millennials are buying homes have a $294,000 average median home value, and the 25 cities where millennials aren’t buying homes have an average median home value of $284,300.
The study created an index value from data taken from the Census’s American Community Surveys that combined the 2017 millennial homeownership rate from 2017 with 2018 and showed the change. While this study showed that high home values are one issue muting homeownership by younger adults, it cited other issues, like stagnant incomes, mounting student debt and what was the largest economic downturn in a century.
24/7 Wall St. wanted to focus on the positive trends of the study, where more millennials are homeowners rather than renters. Instead of using the SmartAsset index ranking, our look was solely at the housing markets with the highest absolute rates of millennial homeownership rates above 50%. It turns out that only eight housing markets out of the top 200 in America had more than 50% of people under 35 owning their homes.
Also, 24/7 Wall St. has made some basic observations about each city to offer some perspective on why homeownership might be so high among millennials. Here are the eight U.S. cities where more than 50% of millennials own their homes.
8. Gilbert, Arizona
> Millennial ownership rate in 2017: 51.2%
> Millennial ownership rate in 2008: 57.0%
> Change over time: −5.7%
> Median home value: $320,000
Gilbert is still above the 50% threshold for millennial homeownership, but it also showed a larger percentage contraction from 2008. It is to the southeast of Phoenix and is a part of that metropolitan area, and it is the sixth-largest municipality in Arizona.
7. Joliet, Illinois
> Millennial ownership rate in 2017: 56.8%
> Millennial ownership rate in 2008: 52.7%
> Change over time: −4.1%
> Median home value: $179,700
Joliet actually saw a drop in the homeownership rate of those under 35 years of age, but it was still well above 50%. The town is located 30 miles southwest of Chicago and is considered part of the broader Chicago sprawl. A 2018 population estimate of 150,495 people would make it the third largest city in the state. Also worth noting is that Joliet had the lowest average median home value of all eight cities where those aged 35 and under own their own home.