Top Rental Markets for Millennials

The Millennial generation is the top of the heap…the largest generation the world has ever seen…a generation of 75M people. Just as the Boomers did when they were the largest, Millennials will impact our culture, our economy, our politics.

Millennials provide the bridge to America’s future. This generation represents 25% of our total population, 40% of our working age population, and 30% of our voting age population. And, incidentally, this millennial generation is composed of 44% minorities, the most diverse and the most gender and race blind population in history.

How do millennnials stack up as real estate consumers? They face multiple financial barriers. Research from the Department of Housing and Urban Development reminds us that the majority of millennials “entered” the housing market just after watching their families and friends lose their homes…at a time when owning a home was not part of the American Dream but rather a part of an American nightmare. Many “entered” the housing market with massive student loan debt in an extraordinarily tight, low wage job market. Many are “entering” the housing market now at a time when housing inventories, particularly first-time buyer inventories, are at historic lows and home prices are at historic highs. And, many millennials are “entering” the housing market during a time of rising interest rates.

This perfect storm in the housing market is causing Millennials to be renters rather than homeowners. The majority still wants to become homeowners…but that majority is facing a reality of renting for the time being.

And where are MIllennials renting?

1. Colorado Springs. 25% of this Colorado town is composed of MIllennials. During this last year, Colorado Springs experienced a net gain of 14.7% due to a low cost of living and to an appealing outdoor and cultural lifestyle.

   

2. San Antonio experience a net gain of 14.4% MIllennials San Antonio is a good place to rent and to eventually buy, a positive environment for real estate investors as well. This Texas town is affordable and has a terrific “local” feel to it via lots of coffee shops and craft breweries.
3. Denver is one of the major tech hubs in North America today and was declared a top housing market for 2018 by those in the know. No wonder the Mile High City experience a net gain of 12.8% Millennials.
4. Orlando experienced a 13% growth in MIllennials and a net influx of 12.7%. Orlando’s cost of living is 5% lower than the national average plus there is no income tax in Florida.
5. Honolulu had a net influx of 12.7% MIllennials despite its housing and rental market being one of the most expensive in the country. According to Abodo, it takes the average buyer to be an average of 24.7 years to save enough for a down payment. No wonder everyone’s renting…renting and going to those beautiful beaches just moments from center city.
6. Austin saw the 6^th highest growth rate for Millennials this past year, saw a net influx of Millennials of 11.8% and sits in second place overall for Millennial percentages in total population density at 27.2%. Austin is a comer for tech start-ups, affordable and has a progressive culture and exploding food scene.
7. Cape Coral, FLA is tied with Houston at a net influx rate of 11.7% in both cities. Both cities scream with affordability and both are continuing to grow.
8. Sarasota, FLA has tremendous momentum for growth. The net influx of Millennials into Sarasota was 11.1%
9. Seattle is a powerhouse economically, internationally and culturally. The net influx of Millennials into Seattle was 10.8% during this last year. No one is selling their homes in Seattle so people are renting in Bothell, Redwood, and South Tacoma. Spokane is filling up with financial refugees from Seattle and Portland.