Recent college graduates are more frequently living at home in expensive cities—and cities those that have seen the biggest boom-bust cycles—according to a new report from Zillow. That means recent grads in Riverside, California; Miami; and New York are the most likely to be living with their parents after leaving school.
According to Zillow, report, which examines U.S. Census data, more than half the recent grads in Riverside lived with their parents in 2016. Close to half in Miami and New York did too. Those numbers are strikingly different compared to 2005 when a quarter of Riverside's recent grads lived with parents and less than a third of Miami's did so.
Overall, the percentage of 20-something college grads living back home in 2016 was 28 percent—which is 19 percent higher than in 2005.
Over the same time period, young college graduates became less likely to live with a romantic partner, falling from 44 percent to 34 percent. In every large metro, a smaller share of college graduates in their twenties lives with a partner than did in 2005. Las Vegas had the biggest decline in the share of recent graduates living as a couple, falling from 47 percent to 29 percent.
According to Zillow, the recent return to parents' homes versus the exodus of young grads a decade earlier is linked closely to where the housing markets were at the time.
Zillow Senior Economist Aaron Terrazas said that lending standards and an abundant supply of homes in the mid-2000s made it easier for recent grads to move out and form their own households instead of living with their parents.
“Those market conditions have changed drastically over the past decade as we went through the housing bust,” Terrazas said. “Adding to that, as many millennials who recently graduated into the Great Recession can attest, underemployment or more precarious jobs make it much harder to save up enough to move out. When rents keep climbing and competition is fierce for the most affordable homes, living with mom and dad can be a good option to build up some savings."
Between 2005 and 2016, the share of recent college graduates living with parents increased from 13 percent to 39 percent in Las Vegas, which, Zillow reported, experienced one of the most dramatic boom-and-bust cycles among the nation's largest markets.
Near the end of 2004, the report states that homes were gaining nearly 50 percent in value each year. After the market collapsed, home values plunged by 62 percent, more than in any other major U.S. market.