Courtesy of SmartAsset
We’ve been hearing a lot lately about how millennials aren’t buying homes at the rate older generations were at the same age, and it’s true across much of the country. In fact, out of 200 cities that SmartAsset looked at for this study, homeownership for millennials had decreased in 152 of them in the past decade.
But happily, there are some exceptions! Here’s a shout-out to the top ten cities bucking that trend. This study by SmartAsset combined two factors: the percentage of millennials (age 24-39) who own homes in a city, and how much home ownership among millennials increased over a ten-year period.
Top 10 Cities Where Millennials Own Homes
1. Gilbert, AZ
2. Peoria, AZ
3. Cape Coral, FL
4. Sioux Falls, SD (Tie)
4. Palmdale, CA (Tie)
6. Moreno Valley, CA
7. Garden Grove, CA
8. Anchorage, AK
9. Midland, TX
10. Hayward, CA
Go West, Young Millennial
The top cities were overwhelmingly west of the Mississippi, with Cape Coral, Florida as the only exception (maybe due in part to Florida’s favorable tax laws). California scored a surprising four out of the top ten spots, despite its recent housing woes. Hayward, California, at number ten, has the highest median home value of the ten at $638,600, yet millennials are somehow managing to purchase homes there.
Finances and Flexibility
In this story from CNBC, financial planner Kaleb Paddock points out that student debt, combined with millennials’ preference for expensive locations, makes home ownership out of reach for many. Beyond financial constraints, though, he notes that flexibility is more important to millennials than it was to their parents and grandparents: “I’ve also seen many millennials intentionally choosing to not buy a home because they don’t want to be tied down to one location. They enjoy the flexibility that non-homeownership provides them. There is flexibility in where they live — along with financial flexibility — since they aren’t tying up a large portion of their finances in a home.”
While flexibility can be a good thing, delaying the purchase of a home can also hurt millennials’ long-term financial outlook. In the U.S. economic system, a home is normally the biggest single investment made by the middle class. Millennials who choose to rent are opting out of the equity they could be building if they were making those same payments toward the purchase of a home.
Time For A Move?
If you’re one of the millennials who does want to buy a home, it might be worthwhile to consider using your current flexibility to move to a city or state where home ownership is more attainable. Start with the above list, or check out the cities where fewer hours of work will pay for your mortgage. And see where people moved in 2019, and why, to learn what makes some areas more favorable for young homebuyers than others. Happy house hunting!