Millennials are forming new households at a significantly faster pace, reports Fannie Mae, which “bodes well for housing demand”.
Researchers found that ““stronger income growth and an accelerated rate of marriage are likely two primary reasons why millennials are starting to leave their parents’ homes at a faster pace.”
A recovering economy and, even more important, a labor market that’s finally beginning to tighten led to inflation-adjusted income growth of “at least 23 percent”, for millennials in their 20s or early 30s between 2013 and 2015 when compared to 2010 and 2012. And that age group’s income is at least 81 percent greater than it was between 2008 and 2010, a dire time to be entering the workforce.
While it’s great that the Great Recession’s effect on the financial prospects of millennials is beginning to recede, I wonder how much of this applies to Silicon Valley. Certainly millennials are a significant part of our population, particularly in downtown Palo Alto, where they account for an impressive 103 percent of the workforce. But my guess is that many of the Valley’s millennials are newcomers who left their parents’ homes (or college dorms) years ago for a great job in the Promised Land, while a significant number of millennials who grew up in the Valley are priced out of the housing market and still living at home.
Yes, I wonder if Silicon Valley is an anomaly. That’s usually a safe bet.
copyright © John Fyten 2017