DARIEN, Conn. – With soaring rent prices and inflation rates in Connecticut, it does not seem like an ideal time for young adults to buy houses. But the trend isn’t reserved to just young adults in Connecticut, according to a recent study.
Nearly a third of Americans between the ages 18 to 25 – a group known as Gen Z – live at home with their parents or relatives, according to a study by finance platform Credit Karma, which surveyed 1,022 young adults online in June 2022. And at the start of the pandemic, about 2.7 million Americans moved back with a relative, according to an analysis from Zillow.
But according to Richard Fry, a senior researcher at the Pew Research Center in Washington D.C., the Credit Karma results represent less of a byproduct of the pandemic, and more of a decades-long cultural shift, in which more young adults are living at home longer due to rising housing costs and other socioeconomic factors.
“If we compare today to say 2019, pre-pandemic, [the average] isn’t lower. It’s just as high. It, in a sense, has not peaked from its long-term tendencies,” Fry said.
As of 2021, a quarter of adults ages 25 to 34 live in multigenerational households, up 9% from 1971, according to Fry’s study.
Fry said multigenerational housing can also serve as a safety net keeping young people from drifting into poverty. According to the Pew Research Center, the poverty level for those who lived in multigenerational housing in 2021 was lower than those living in other living arrangements. This especially impacts young men without a bachelor’s degree, whose earnings have been declining, Fry said.
“For less educated young men, their inflation-adjusted wages have been falling over time. So their ability to live independently because of their falling wages has been undercut,” Fry said.
Rent in the Bridgeport-Norwalk-Stamford Metro area has the third-most expensive median monthly rent, according to previous Hearst Connecticut reporting.
In February 2022, the median monthly rent in Hartford and surrounding towns was nearly $1,650, an increase of 13.3% from the previous year, according to realtor.com®.
As rent prices in Connecticut increase, renters in the state also need a higher income to afford the housing they want.
A renter in Connecticut must earn $27.80 an hour to comfortably afford a two-bedroom apartment and $22.53 to comfortably afford a one-bedroom apartment, according to a report released Aug. 2.
Regardless of income, prices still escalated quickly in the past two years.
Jessica Hoover, a real estate agent on the One Team at William Raveis Real Estate, said during the pandemic home and rent prices skyrocketed.
“In addition to the people moving on from New York City, rent skyrocketed, because now you have people who sold their homes that are now looking for rents who normally wouldn’t have been renting.
So the demand for rents went up. And landlords basically knew [they] could charge hundreds of dollars more a month, and [they’d] still fill those spaces,” she said.
Student loan debt
Nationally, student loan debt rose by 144% from 2007 to 2020.
In 2021, the average student debt in Connecticut was $35,853, according to data from the Institute for College Access & Success, putting Connecticut as the fifth-highest state regarding average student loan debt.
Debt also makes it more difficult for residents to obtain a home in Connecticut’s competitive housing market, Hoover said.
“It’s very hard to get into a rental these days – you have to have a really high credit score. Your application has to look amazing,” Hoover said. “If you have a big debt-to-income ratio, because you have student loans, then that’s going to come up in the application.”
Finances aren’t the only reason young adults might still live with their relatives. Demographics, culture and geography also play a role.
“The nation of over the last 50 years has become more diverse. And the groups that are basically gaining more prominence tend to have a greater share of young adults living in multigenerational arrangements. And so particularly, the growing groups have been Asian American, and Hispanic Americans. And those tend to have more young adults living at home,” Fry said.
Jeffrey Jensen Arnett, a senior research scholar at Clark University, said young Americans are also going to school longer and marrying later, which can delay making housing decisions. As of 2019, people in Connecticut typically marry between 29 and 31.
Emerging adults are also more likely to prefer living in an urban area for the social scene and job options, he said.
Copyright © 2022, The Darien Times. Additional reporting by Daniel Figueroa IV. All rights reserved.