Myth Versus Reality: Millennials’ Housing Choices

PLAY OF THE LAND

It’s the question that’s on everyone’s mind: What’s the deal with millennials?

As the largest living generation in the U.S. (having recently surpassed the Baby Boomers, according to numbers from the Pew Research Center), the group is an object of fascination for everyone from sociologists to shampoo marketers. And it’s not just the generation’s size that has drawn attention. Its habits, too, seem starkly different from its predecessors.

Tales abound of millennials’ strange ways. They don’t drive. They don’t date. They don’t want to work their way up the corporate ladder.

The findings also suggest, though, that more than any generational preference, money is the main factor driving these choices.

But how much of this is true, and how much is simply the sort of grumbling and stereotyping older cohorts indulge in with regard to the youngsters coming up behind them? (Some of us, for instance, are old enough to remember the days when the laggards of Generation X were going to bring the world to a grinding halt.)

A recent report from CBRE Research took a look at this question, collecting data from 7,000 CBRE staff members and 13,000 millennials from 12 countries in order to examine the ways in which millennial behavior does, and doesn’t, match its reputation.

The report, titled Millennials: Myths And Realities, took as one area of focus, housing, where millennials are perceived by many to be particularly hesitant—reluctant to move out of their parent’s homes and, when they do, more likely to rent than buy. And, the survey suggests, there’s a germ of truth to this characterization: A high percentage of millennials do live at home, and renting is relatively popular among the cohort who have moved into their own places. The findings also suggest, though, that more than any generational preference, money is the main factor driving these choices.

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Of the millennials surveyed, 49 percent live at home with their parents, with 43 percent of these planning to stay for three years or more and 12 percent having no plans to ever leave. As the report observes, though, it’s not the home cooking that’s keeping them around.

Rather, “high property values drive the decision to stay,” the authors note. “Steep housing prices and rents, coupled with a lack of suitable jobs, mean that many millennials are not earning enough to live an independent life. For an increasing number, the trade-off is to remain with the folks. Of those who can afford to live independently, many choose to stay at home to save toward deposits on homes of their own.”

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That millennials are more likely to rent than own is also true, with the survey finding that 64 percent of those living independently rent their homes. Again, while a subset (29 percent) do so out of preference, a much larger proportion (65 percent) do so for financial reasons, belying the common stereotype of millennials as commitment averse. In fact, the report found that more than two-thirds of millennials plan to own a property in the future.

In other words, as rapper Sean ‘Diddy’ Combs (also known as Puff Daddy) put it nearly 20 years ago (when a significant chunk of millennials were still in diapers), “it’s all about the Benjamins.” At least when it comes to housing, millennials aren’t such mysterious creatures—they’re just still working to get their footing.

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