House Key Real Estate Homes for Sale Pixabay

Finishing school, joining the workforce and moving out on your own is a rite of passage for many young people. Today’s young adults are taking longer to make this transition, and doing it less often overall, than previous generations, according to a new Zillow analysis.

And the Washington region is no exception.

In 1980, 1990 and 2000, the tipping-point age at which more people lived independently than not remained steady at 23. But by 2007, it had risen to 25, then to 26 in 2017.

In the Washington area, the tipping point was age 24 in 1980, 1990 and 2000, but was up to age 26 in 2007 and then 27 in 2017.

“It’s true that people are becoming homeowners later and later in life, but even before that today’s adults are taking significantly longer to simply live on their own,” said Skylar Olsen, director of economic research at Zillow.

Not only does it take longer for young adults to begin living independently;  fewer people ever do. A smaller share of adults of every age lived independently in 2017 than 1980, including a 10-percentage-point gap for 40-year-olds.

Typically, adults begin living independently later in more expensive metros, and the gap has widened over the past four decades. Since 1980, the tipping-point age has increased by an average of about four years in metros in the top quarter of most expensive home values, compared to about two years for metros in the bottom three quarters.

In 2017, the tipping point age was highest in Riverside, Los Angeles, New York and Miami at 29. Each of these metros have seen their tipping-point ages increase by at least five years since 1980, while it has only increased one year in less-expensive Oklahoma City, for example  – from 21 to 22.

Young people today more often pursue higher education, which typically delays when they begin working full-time. In previous decades, people with a high-school education lived independently at similar rates to those with a college education, likely due to the additional years of earnings they can accrue in their early 20s while their college counterparts are in school. Now, there is a significant gap.

Those with a college degree are more likely to live independently than those with a high-school education by age 26, and at age 30 the gap widens to 12 percentage points.

Changes in social and cultural norms, as well as affordability challenges, likely explain some of the shift. Young people today are more likely than their predecessors to live in urban cores, where housing is more expensive and rent-price growth has hindered the ability of renters to afford a home without roommates or save enough of their salaries each month for a down payment.

Increased demand for starter homes as the large Millennial generation reaches typical home-buying age, along with persistently low inventory, has contributed to robust home-value appreciation in many large metro areas, making it more difficult for first-time buyers to get into a home.

“While some may consider the impact of evolving tastes and cultural norms, as economists we can point to very real changes in household budgets that make the classic tactics of sticking with mom and dad or extending those college-roommate years past graduation more appealing,” Olsen said. “As the costs of life’s basics outpace incomes, parents that offer housing after their children‚‘s schooling has ended can provide breathing space, allowing the next generation to begin paying off substantial college debt.”

Smaller, more accessible housing markets often tout not just the possibility of home-ownership for today’s adults, but also the opportunity for independence and privacy – features of life that major job markets struggle to offer more and more, Olsen said.

(0) comments

Welcome to the discussion.

Keep it Clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
PLEASE TURN OFF YOUR CAPS LOCK.
Don't Threaten. Threats of harming another person will not be tolerated.
Be Truthful. Don't knowingly lie about anyone or anything.
Be Nice. No racism, sexism or any sort of -ism that is degrading to another person.
Be Proactive. Use the 'Report' link on each comment to let us know of abusive posts.
Share with Us. We'd love to hear eyewitness accounts, the history behind an article.