Millennials are leaving major cities in droves over rising costs
Millennials are headed to the ‘burbs.
Just like generations before them, millennials -- between the ages of 23 and 38 -- are leaving cities and moving to the suburbs to find affordable housing, according to a report from The Wall Street Journal.
After the financial crisis, growth in the city surpassed that of the suburbs, according to the outlet, but over the last five years that growth has slowed, in part because of rising costs of city-living and because millennials are getting married and starting families.
“The back-to-the-city trend has reversed,” William Frey, a demographer at the Brookings Institution told The Journal.
But unlike their parents and grandparents, millennials are being more selective in where they’re going, the outlet reported, primarily in the South and Southwest, with good weather and good jobs nearby.
The suburbs where millennials are moving -- such as Apex, N.C., near Raleigh -- are growing so fast that they can hardly keep up. Schools are over capacity and commutes are slowed by traffic jams, according to The Journal.
The struggle to buy homes is expected to continue to become more costly and competitive over the next decade, according to a May analysis by Zillow.
Nearly 45 million Americans will enter their mid-30s over the next 10 years or 3.1 million more than in the last decade. That potential surge in would-be buyers could drive up demand, pushing prices higher, particularly in the more affordable end of the market. The trend could also mean higher costs for renters.
"If this coming wave of buyers have to compete fiercely for homes to purchase, that could drive up rent prices as well as home values," Skylar Olsen, Zillow's director of economic research, said in May.
Many millennials have had to put off buying a home as they grapple with student loans and rising rents, which make it harder to save up for a down payment. First-time buyers now typically need another 1.5 years to save for a down payment than they did 30 years ago, according to Zillow.
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However, millennials are expected to have a tougher time finding homes they can afford unless home construction increases and more baby boomers trade in their homes for smaller dwellings in retirement, Olsen said at the time.
"A large set of them are going to find that almost impossible," she said. "So they're going to linger in the rental market for longer, they're going to continue to put pressure on the rental market, too."
The Associated Press contributed to this report.