Where Are Young People Buying Homes? » Mortgage Masters Group
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Where Are Young People Buying Homes?

Picture of a young couple as homebuyers representing Where Are Young People Buying Homes

The housing market has increasingly discouraged young people from buying homes. A June 2022 survey by Money and Morning Consult found that given the state of the housing market over the past two years, 48% of Generation Z and 44% of Millennials report that they are less likely to buy a home. This is significantly higher than the 38% of people overall who report wariness.

Some cities, however, have attracted more young homebuyers in recent years than others. In this study, SmartAsset analyzed the cities where more (and fewer) young people are buying homes. We compared 200 of the largest cities across two metrics: 2021 homeownership rate for those under 35 and the 10-year change in homeownership rate for those under 35. For more information on our data and how we put it together, read our Data and Methodology section below.

This is SmartAsset’s second annual study on where young people are buying homes. Read last year’s version here.

Key Findings

  • In eight cities, more than half of young people own their homes. The under-35 homeownership rate is highest in Florida’s Port St. Lucie (roughly 60%). In comparison, nationally, only about 37% of individuals under the age of 35 own their home or apartment.
  • California cities rank at the top and bottom of our list. Two California cities rank in our top 10 places where more young people are buying homes (Ontario and Roseville), while four rank in our bottom 10 (Fullerton, Glendale, Torrance and Salinas). Interestingly, though Ontario and Fullerton are less than 30 miles away from each other, the under-35 homeownership rate varies by more than 27 percentage points (41.25% in Ontario and only 13.32% in Fullerton).
  • Across the 10 largest cities, Philadelphia ranks highest. Ranking in the top half of the study, about 27% of young people in the City of Brotherly Love are homeowners. In stark contrast, this figure is less than 13% in the two largest U.S. cities (New York and Los Angeles).

 

Where More Young People Are Buying Homes

Surprise, Arizona ranks as the top place where more young residents are buying homes. Surprise has seen a 10-year increase of 15.88 percentage points in the homeownership rate among people younger than 35, the second-largest growth in our study. The total homeownership for that age cohort in 2021 was 57.60%, also the second-highest rate we analyzed for that metric.

Across the other top nine cities where more young people are buying homes, Chesapeake, Virginia had the best overall 10-year change in the homeownership rate for those under 35. Census Bureau data shows that from 2011 to 2021 the under-35 homeownership rate in Chesapeake grew by almost 16 percentage points. Meanwhile, the 2021 homeownership rate for young people is highest in Port St. Lucie, Florida (60.23%).

Where Fewer Young People Are Buying Homes

Two of the three places where the fewest young people are buying homes are in New Jersey. These Garden State cities are Paterson and Jersey City. In both cities, less than 12% of people under 35 are homeowners and the under-35 homeownership rate is declining. In Paterson, the under-35 homeownership rate dropped by more than nine percentage points between 2011 and 2021.

As previously noted, four cities in California rank at the bottom of our list. Across those cities, the under-35 homeownership rate is lowest in Glendale (9.90%) and declining the most in Fullerton (-8.73%). The table below shows the top 10 cities where fewer young people are buying homes.

Data and Methodology

To find the cities where more and fewer young people are buying homes, SmartAsset examined data for 200 of the largest cities in the U.S. We considered two metrics:

  • 2021 homeownership rate for those under 35. This is the homeownership rate among 18- to 34-year-olds. Data comes from the U.S. Census Bureau’s 2021 1-year American Community Survey.
  • 10-year change in homeownership rate for those under 35. This compares the homeownership rate among 18- to 34-year-olds in 2011 and 2021. Data comes from the U.S. Census Bureau’s 2011 and 2021 1-year American Community Surveys.

First, we ranked each city in both metrics. Then we found each city’s average ranking and used the average to determine a final score.

Saving Tips for Millennials

  • Invest early. At the onset of your career, it’s important to dedicate some of your earnings to building up savings for retirement. By planning and saving early you can take advantage of compound interest. Take a look at our investment calculator to see how your investment can grow over time.
  • Buy or rent? When you’re moving to a new city, you need to decide if you are going to rent or buy. If you are coming to a city and plan to stay for the long haul, buying may be the better option for you. On the other hand, if your stop in a new city will be a short one, you’ll likely want to rent.
  • Consider a financial advisor. An expert can help you maximize your money with guidance on savings, investments and retirement. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

 

STEPHANIE HORAN, CEPF®Stephanie Horan is a data journalist at SmartAsset. A Certified Educator of Personal Finance (CEPF®), she sources and analyzes data to write studies relating to a variety of topics including mortgage, retirement and budgeting. Before coming to SmartAsset, she worked as an analyst at an asset management firm. Stephanie graduated from Williams College with a degree in Mathematics. Originally from Philadelphia, she has always been a Yankees fan and currently lives in New York.



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