With housing costs rising and wages stagnating, America's youth can't say goodbye to mom and dad.
Despite a growing economy and a rebounding job market, there’s currently a larger share of young Americans living at home with their parents than at any other point in recent history.
In 2015, 40 percent of young Americans — millennials between the ages of 18 and 34 — lived with family members, according to an analysis of census data by real estate tracker Trulia. This number has steadily risen since 2005 and is now the highest it’s been since 1940.
Before the last recession began, roughly one out of three in the 18-34 age range lived with parents, siblings, or other relatives. While the percentage had a recession-fueled spike at the end of the last decade, the trend never declined as it had after previous economic disasters.
After the share of young Americans living at home hit a high of 40.9 percent in 1940, for example, it then fell to a low of 24.1 percent in 1960. From the 1980s to the mid-2000s, it hovered between 31 and 33 percent.
From there it started to rise, as buying a household is closely correlated with affordability and income.
High rents and unfavorable mortgage-lending standards could very well be the culprits. In the 1950s, the average house and down payment cost — adjusted for inflation — was $83,068 and $16,613 respectively. By 2014, those figures had skyrocketed to $365,700 and $73,140.
“I don’t think those are challenges that are going to keep young households permanently out of the housing market, but it may keep their homeownership rate near historic lows for likely the indefinite future,” said Ralph McLaughlin, Trulia’s chief economist, to the Wall Street Journal.
In this current economic climate, we now have an unprecedented situation in which the largest youth generation in U.S. history is simply not purchasing homes anymore.
Next, read about why millennials could have decided the 2016 president election, but didn’t, before checking out why you should be blaming 18th-century monarchs for selfies.