Type Of Millennial Mostly Likely To Live With Parents

Young adults aged 18 to 34 are more likely to live with a parent than in any other arrangement for the first time since 1880, the Pew Research Center recently reported. But researchers have found a somewhat surprising segment of the millennial population more likely to be staying in their parent's basement. Pew reports it's mostly older, male millennials without a college degree who are making for the record numbers.

While the youngest of today's adults are still the most likely to live with their parents, the numbers show a growing number of older millennials are moving back in. For example, 25 percent of people ages 25 to 29 are living with a parent, up from 18 percent 10 years ago. What's more, 13 percent of Americans ages 30 to 34 are living with their parents, up from 9 percent a decade ago.

Richard Fry with the Pew Research Center says the poor job market for young men in particular is fueling the trend of adult children living at home with their parents. Nearly 6 percent of men ages 25 to 34 years old are unemployed, according to the Bureau of Labor Statistics (the national average just dipped below 5 percent). Meanwhile, the home ownership rate for those under the age of 35 is at a 20-year low.

"These trends could have larger implications for future economic growth and financial stability, as housing represents over 60 percent of of assets held by the middle class and roughly 15 percent of gross domestic product," The Washington Post reports. "Since the share of 25- to 34-year-olds living with a parent has been steadily rising since reaching its lowest point 45 years ago, it may be years until we experience the full significance of these new living arrangements. With its potential impact on the economy, though, it’s a trend we may not be able to ignore."

Source: "The Real Reason So Many Millennials Are Living at Home," The Washington Post (June 30, 2016)

Young Adults Without Diploma Face Bigger Hurdles To Home Ownership

Young adults without a college diploma may face the greatest hurdles to owning a home, suggests new research based on a survey of 31,000 respondents.

College graduates between 18 and 34 without student loan debt will need just over five years of additional savings to afford a 20 percent down payment for a starter home (defined in the study as the median home at the bottom third of the market), according to new research released this week by Apartment List, a rental listing website. For college grads with student loans, it’ll take about 10 years.

But for young adults who haven’t graduated from college, the wait to buy a home could take up to 15.5 years, the study shows. (Note: Some mortgage loans available require lower down payments than 20 percent and could shorten the wait time.)

Regardless, “it’s really everywhere that people without college degrees won’t be able to afford homes,” says Andrew Woo, director of data science at Apartment List. “They could be stuck renting for a long time.”

Those without college degrees tend to have lower incomes (college grads make about $22,600 more than non-grads), but those without degrees also tend to get less help with down payments from family and friends, the study says.

Case in point, college graduates without student debt tend to get more than $8,000 of assistance with loans. College graduates with student loans expect to get nearly $4,000. But those without a college degree tend to receive just over $2,000, according to the study.

In some cities, the issue is particularly dire for non-grads. For example, in San Jose, Calif., a young adult without a college degree would need to save for 48 years to afford a 20 percent down payment on a starter home there. College grads with student debt would need to save for 15 years, and college grads without debt would need to save for about 4.5 years.

Source: “Homeownership Elusive for Adults Without Degrees,” The Wall Street Journal (May 23, 2016) [Log-in required]