SEATTLE, Feb. 3, 2022 /PRNewswire/ -- Home values are
growing fastest in areas with the highest share of kids, reflecting
the impact millennial house hunters are making on family-friendly
neighborhoods with a shortage of homes for sale. A record
number of millennials will reach key age milestones for home
buyersi over the next two years, which may accelerate
price gains even further.
The top 10% of ZIP codes with the largest share of kids in each
county analyzed saw an average of 21.3% growth from October 2020 to October
2021, compared to 17.6% in ZIP codes with the smallest share
of kids. That trend started in 2013, which, not coincidentally, was
the year the oldest millennials turned 32, the age when many new
parents buy their first homes. That's the median age of first-time
home buyers and one year older than the median age of fathers with
newborns.ii
"As millennials go, so goes the housing market, and we are
seeing now, as millennials age, that they are looking for homes
that fit the needs of growing families," said Zillow economist
Nicole Bachaud. "Millennial demand
has helped push up home prices in areas with the most children.
Competition for homes in these family-friendly areas should
intensify in the coming years as more millennials reach the key age
of 32, adding to the affordability squeeze."
Zillow analyzed 421 U.S. counties,iii
representing 71% of the country's population. ZIP codes with more
residents under 18 years oldiv are associated with
higher home value growth in nearly two-thirds of the counties
studied. Many of the counties where this relationship does not hold
true are vacation destinations, where part-time residents have
unconventional housing demands. Home value growth in these
family-friendly areas began to outpace nearby ZIP codes in 2013,
and the correlation between kids and home value growth has been
nearly perfect for each year since 2017.
That first wave of early-30s millennials had the benefit of
discounted home prices as a result of the Great Recession; home
values in these family-friendly ZIP codes were hit particularly
hard between 2008 and 2011, in the midst of the nationwide housing
crash. Today's first-time home buyers are encountering a much
different market, especially as home price growth has reached
record highs during the pandemic.
The snowball of millennials reaching peak age for first-time
home buyers has grown during the past nine years, and is about to
turn into an avalanche. Nearly 200,000 more Americans will turn 32
this year than did so in 2021 ― the biggest jump since the
transition from Generation X to millennials in 2013 — and even more
will do so in 2023. This demographic reality should fuel even
faster price growth in family-friendly ZIP codes over the next two
years, making saving for a down payment even more challenging
for first-time buyers.
This effect is strongest in counties that encompass the cities
of Norfolk, Virginia; Washington, D.C.; Portland, Oregon; Austin, Texas; and Seattle. Counties where this trend does not
hold true include those encompassing Galveston, Texas; Santa Barbara, California; and Ocean City, New Jersey.
Metro
Area*
|
ZIP Code with
Highest % of Kids
|
ZIP Code With
Lowest % of Kids
|
ZIP
Code
|
% of
Kids
|
Year-over-Year
Home
Value Growth (Dec.
2021)
|
ZIP
Code
|
% of
Kids
|
Year-over-Year
Home
Value Growth (Dec.
2021)
|
New York,
NY
|
08701
|
48.3%
|
28.2%
|
07756
|
2.2%
|
20.3%
|
Los Angeles,
CA
|
92694
|
37.0%
|
25.2%
|
92637
|
0.2%
|
10.9%
|
Chicago,
IL
|
60585
|
34.1%
|
16.9%
|
60606
|
3.6%
|
-0.8%
|
Dallas, TX
|
75253
|
36.5%
|
22.7%
|
75207
|
1.7%
|
16.0%
|
Philadelphia,
PA
|
08104
|
32.6%
|
35.9%
|
19102
|
3.3%
|
-1.5%
|
Houston,
TX
|
77032
|
40.6%
|
14.9%
|
77002
|
1.1%
|
4.2%
|
Washington,
D.C.
|
22060
|
41.1%
|
7.8%
|
20037
|
2.1%
|
0.1%
|
Miami, FL
|
33327
|
33.8%
|
22.7%
|
33480
|
4.9%
|
30.4%
|
Atlanta,
GA
|
30021
|
33.3%
|
26.5%
|
30303
|
1.0%
|
8.6%
|
Boston, MA
|
02052
|
29.9%
|
15.3%
|
02215
|
2.4%
|
0.6%
|
San Francisco,
CA
|
94621
|
31.4%
|
15.6%
|
94704
|
3.2%
|
10.9%
|
Detroit,
MI
|
48210
|
35.4%
|
-0.1%
|
48226
|
3.2%
|
7.7%
|
Riverside,
CA
|
92301
|
34.4%
|
29.6%
|
92210
|
5.1%
|
30.1%
|
Phoenix,
AZ
|
85297
|
36.4%
|
34.3%
|
85351
|
0.4%
|
29.5%
|
Seattle,
WA
|
98439
|
34.4%
|
25.2%
|
98101
|
2.9%
|
3.6%
|
Minneapolis,
MN
|
55411
|
35.7%
|
7.1%
|
55401
|
3.5%
|
0.3%
|
San Diego,
CA
|
91906
|
33.0%
|
22.7%
|
92101
|
4.8%
|
15.0%
|
St. Louis,
MO
|
63106
|
34.7%
|
19.3%
|
63102
|
2.6%
|
5.7%
|
Tampa, FL
|
33547
|
34.8%
|
30.2%
|
33573
|
6.1%
|
31.7%
|
Baltimore,
MD
|
20755
|
32.4%
|
8.0%
|
21202
|
11.0%
|
11.2%
|
Denver, CO
|
80238
|
35.0%
|
17.5%
|
80202
|
2.2%
|
8.3%
|
Pittsburgh,
PA
|
15110
|
30.1%
|
15.6%
|
15213
|
3.2%
|
11.6%
|
Portland,
OR
|
97140
|
29.3%
|
20.3%
|
97209
|
3.5%
|
0.5%
|
Charlotte,
NC
|
28088
|
30.4%
|
25.5%
|
28202
|
7.9%
|
13.0%
|
Sacramento,
CA
|
95742
|
30.4%
|
23.2%
|
95814
|
6.5%
|
4.3%
|
San Antonio,
TX
|
78242
|
32.2%
|
15.4%
|
78215
|
4.8%
|
13.5%
|
Orlando,
FL
|
34773
|
35.7%
|
27.7%
|
32801
|
8.2%
|
16.0%
|
Cincinnati,
OH
|
45232
|
47.4%
|
25.2%
|
45219
|
6.1%
|
14.8%
|
Cleveland,
OH
|
44104
|
32.2%
|
20.5%
|
44114
|
4.5%
|
15.8%
|
Kansas City,
MO
|
64126
|
36.7%
|
35.3%
|
64105
|
3.0%
|
8.5%
|
Las Vegas,
NV
|
89086
|
37.0%
|
26.2%
|
89029
|
7.6%
|
24.8%
|
Columbus,
OH
|
43211
|
32.2%
|
37.1%
|
43215
|
1.9%
|
6.0%
|
Indianapolis,
IN
|
46235
|
32.4%
|
21.4%
|
46204
|
2.5%
|
7.4%
|
San Jose,
CA
|
95020
|
27.8%
|
19.9%
|
95113
|
2.3%
|
-0.3%
|
Austin, TX
|
78724
|
34.1%
|
50.2%
|
78701
|
1.8%
|
23.4%
|
Virginia Beach,
VA
|
23523
|
35.3%
|
17.7%
|
23517
|
8.4%
|
12.1%
|
Nashville,
TN
|
37086
|
31.5%
|
27.8%
|
37201
|
3.8%
|
15.2%
|
Providence,
RI
|
02907
|
28.4%
|
17.5%
|
02903
|
5.3%
|
12.3%
|
Milwaukee,
WI
|
53218
|
34.4%
|
19.1%
|
53202
|
2.4%
|
7.1%
|
Jacksonville,
FL
|
32081
|
29.3%
|
35.0%
|
32202
|
7.3%
|
22.7%
|
Memphis,
TN
|
38126
|
35.6%
|
24.2%
|
38103
|
6.5%
|
13.1%
|
Oklahoma City,
OK
|
73119
|
37.8%
|
21.5%
|
73102
|
2.6%
|
11.0%
|
Louisville,
KY
|
40210
|
31.8%
|
20.3%
|
40202
|
6.1%
|
2.4%
|
Hartford,
CT
|
06120
|
34.2%
|
15.2%
|
06103
|
3.9%
|
10.9%
|
Richmond,
VA
|
23120
|
32.7%
|
15.8%
|
23230
|
13.0%
|
15.3%
|
New Orleans,
LA
|
70447
|
32.6%
|
14.4%
|
70116
|
11.5%
|
1.7%
|
Buffalo,
NY
|
14212
|
29.4%
|
28.6%
|
14222
|
8.6%
|
12.4%
|
Raleigh,
NC
|
27571
|
37.2%
|
32.0%
|
27605
|
8.7%
|
20.9%
|
Birmingham,
AL
|
35091
|
30.8%
|
13.6%
|
35233
|
2.3%
|
12.0%
|
Salt Lake City,
UT
|
84096
|
41.6%
|
29.9%
|
84102
|
6.3%
|
21.1%
|
*Table ordered by
market size
|
About Zillow Group
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i Consumer Finance Protection Bureau:
https://files.consumerfinance.gov/f/documents/cfpb_market-snapshot-first-time-homebuyers_report.pdf
ii Human Reproduction, Volume 32, Issue 10,
October 2017, Pages 2110–2116:
https://academic.oup.com/humrep/article/32/10/2110/4096427.
iii Every U.S. county with at least 10 ZIP codes
containing 1,000 households or more was included in the study. This
threshold was imposed to ensure a sufficient sample of homes and
ZIP codes in each county.
iv Estimates of each ZIP code's share of population
under 18 years old come from the U.S. Census Bureau's 2019 American
Community Survey five-year estimates.
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SOURCE Zillow