Virginia Housing Coalition- Top 40 Network

Housing Needs and Preferences Among Millennials

A Presentation to the Virginia Housing Policy Advisory Council by the Top 40 Network

Jasper HendricksMonique Johnson

Joseph JonesMadelyn Peay

• In 2014, 31% of homebuyers were Millennials. Millennials are expected to overtake Gen X as the largest group this year.

• Nearly 9 in 10 (88%) of Millennials aspire to home ownership.• Common anecdotes about what Millennials want

• Smaller• Urban• Fewer embellishments• Open floor plans• Low maintenance• Less emphasis on outdoor space

National Trends

• 13% live in or near downtowns; 63% live in other city neighborhoods or in the suburbs

• 50% are renters, paying a median monthly rent of $925• 21% live at home, but 90% expect to move out within 5 years• 14% live in households with three generations of family

members• 18% of all Millennials and 27% who rent share housing with

roommates. However, 58% of those with roommates would prefer to live alone.

• Healthy Living is a focus

The Reality About Millennials

Despite the housing crisis and the challenges Millennials face securing middle-class lifestyles, nearly nine in 10 (88%) Millennials aspire to home ownership.

More than half (53%) of Millennials say homeownership is a high priority for them personally, while just two in five (43%) of all adults who do not already own a home say the same.

Summary

Percentage of Millennials that say homeownership is a high priority

Percentage of adults that do not already own a home who say that

homeownership is important

0% 10% 20% 30% 40% 50% 60%

53%

43%

Percentage of Millennials vs. Other Adults that Prioritize Homeownership

• In a presentation to the Virginia Housing Commission on April 14, 2015, Sonya Waddell with the Richmond Federal Reserve Bank reported that the Virginia housing market has grown slower than the US market.

• Virginia is lagging behind the national average in employment growth.

• Virginia labor markets are struggling, particularly in the professional and business services sector. This affects the Virginia housing market.

Virginia

• Millennials and empty nesters are flocking to more urban environments with walkability factors.

• Example: Danville has seen this in its downtown River district.

Millennials in Virginia

Demographics• Geographically diverse mix of Gen X and Gen Y respondents• All respondents were homeowners who live in urban/

suburban/ ruralFindings• Current housing decisions driven by affordability and

proximity to goods/ services• Future decisions influenced by proximity, schools, and

affordability

Sample Survey of Top 40 Network

External Validity: Is the Top 40 Network a representative sample?• Probably not- skewed educational level and skills attainment• Millennials are more educated but growing skills gap exists• Growing divide by education • Millennial disparities in annual earnings and poverty

correlated with educational attainment (i.e. no college four times more likely to live in poverty than Bachelors degrees)

Sample Survey of Top 40 Network

• Homeownership among the college educated seems like the eventual goal

• Affordable rental is an imperative for at least 1/3 of Millennials without college education

Survey Takeaways

• Restructure student debt• Enhance community colleges• Prioritize tax credits in redevelopment areas

Our Ideas