The 5 Best Purchase Markets for Young Adults
April 25, 2019
Affordability and a good job market are the two chief influencers for moving millennials, according to the National Association of REALTORS®’ new report “Most Popular Areas for Millennials: Where They Move and Stay.” Millennials, those between the ages of 21 and 38, account for 37 percent of all home purchases—making up the largest buying force in the housing industry, according to NAR.
Other Key Findings on Millennial Movers
- One out of 2 people who moved in the 100 largest metro areas was a millennial (54%).
- The median income for millennials who recently moved into the 100 largest metro areas was $53,000.
- In the top 10 metro areas, millennials can afford to purchase, on average, 17 percent of homes currently listed for sale.
- Millennials tend to reside and move to locations and cities where employment is strong. In the top 10 metro areas, the unemployment rate was at about 3.6 percent in most of these areas, lower than the national average.
NAR analyzed employment gains, population trends, income levels, and housing conditions among the 100 largest metro areas nationwide to identify the most popular areas for millennials.
In 2019, Madison, Wis., ranks as the top destination for millennials. Seventy-five percent of those who recently moved to the city have been millennials. Also, as of 2017, the median income for millennials there overall was $62,000 and $68,500 for millennials who recently moved to the city.
“In comparison to other areas, Madison offers one of the highest wages for millennials,” says Lawrence Yun, NAR’s chief economist. “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.”
Bakersfield, California, which lies between San Francisco and Los Angeles, is also a popular place for young adults to relocate to. Twenty-eight percent of the residents are millennials in Bakersfield, and 67 percent of the new people coming in are millennials. Bakersfield is known as one of the most affordable metro areas in the state. Millennials who relocate there can afford to purchase nearly 15 percent of the homes listed for sale, significantly higher than the 4 percent who can afford to buy a listed home in neighboring Los Angeles, NAR notes in the study.
“The increasing employment rate in California is another strong selling point among this generation,” says Yun. “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. Homebuilding in Bakersfield is rising, too. Many newcomers to San Francisco and Los Angeles do not stay for long because of unaffordability. Millennials moving to Bakersfield meanwhile are looking to take advantage of conditions toward homeownership.”
Updated: May 24, 2019