Where are millennials moving?

The term “millennial” brings to mind a certain image — that of an urban dwelling, craft-brew drinking, Uber-riding young adult. Of course, a whole generation can’t be pigeon-holed into one specific stereotype. Millennials, defined by the Pew Research Center as people born between 1981 and 1996, will soon surpass the number of baby boomers and is now the largest generation in the U.S. labor force. In the U.S., their numbers hover around 73 million.

While critical stereotypes of millennials abound, millennials are also viewed as wanting to make a difference in the world, striving to pursue their passions, and being open-minded. Although millennials are more likely to delay marriage and parenthood than previous generations, a large share of millennials are now in their 30s. According to the Pew Research Center’s analysis of Census Bureau data, more than a million millennials become mothers each year.

A recent Gallup Report, How Millennials Want to Work and Live, describes millennials as slightly “unattached,” meaning they are less likely to stay in one community, do not feel close ties to their jobs, and are more likely to job-hop than previous generations. Millennials are also devoted to wellness, spending more time and money on exercising and eating healthy, according to the Goldman Sachs report Millennials Coming of Age.

Lifestyle choices and preferences also dictate where millennials live and where they choose to move. In this analysis, Haven Life ranked metropolitan areas according to the percentage change in the population of millennials from 2012 to 2017 using Census Bureau data. At the metropolitan level, the data shows that millennials tend to live in expensive locales with high wages, home prices and the overall cost of living. In these cities, experiences are plentiful and there are myriad opportunities to form relationships with like-minded people.

Among large metros with more than 1,000,000 people, there is a positive correlation between the percent change in the millennial population and the millennial share of the population. However, this doesn’t hold for smaller metros. Among large metros, millennials are moving to places where there is already a high proportion of millennials despite higher home prices and cost of living.

Perhaps because millennials have pushed back getting married and starting families, they as a generation are less price conscious than previous generations. But for millennials starting families, their preferences might align better with historical norms. “Like other generations, as millennials have started having families, their housing interests have shifted in unsurprising ways. They want more space and they begin to care more about schools, safe neighborhoods, and access to family-friendly amenities,” said Joey Campbell, director of content for Rent.com and ApartmentGuide.com,

When asked how millennial families are responding to skyrocketing housing costs in coastal states, Campbell cited data from National Van Lines that shows how Washington, California, Illinois, New York, and New Jersey are among a group of states experiencing a net loss of residents. Whereas, more affordable states like Texas, North Carolina, South Carolina, Arizona, and Colorado are experiencing a net inflow of residents. “This is probably driven by housing costs, but also cultural, geographic, and demographic factors,” Campbell explained.

While such trends might be indicative of what the future holds for millennials as a whole, the most recent Census data still shows a strong preference for many of America’s priciest metros.

Here are the metropolitan areas with the largest percentage increase and decrease in millennials over the past 5 years:

 

Where millennials are moving to

1. Portland-Vancouver-Hillsboro, OR-WA

  • Percentage change in millennial population: 22.8 percent
  • Percentage of population that are millennials: 18.6 percent
  • Median earnings among millennials: $41,054
  • Median home price: $346,833
  • Cost of living: 2 percent above average

Portland had the largest percentage change in millennials of any large metro from 2012 to 2017. The area isn’t cheap, although not nearly as expensive as other millennial hotbeds San Francisco and Seattle. The lure of the city’s craft breweries, bike lanes, and quirky reputation are big draws for millennials. But it’s not just for hipsters; this outdoorsy Pacific Northwest metro area is a great place to raise a family. The Portland metro area boasts plenty of parks, and both beaches and mountains are easily accessible.

2. Seattle-Tacoma-Bellevue, WA

  • Percentage change in millennial population: 22.2 percent
  • Percentage of population that are millennials: 20.1 percent
  • Median earnings among millennials: $52,582
  • Median home price: $399,475
  • Cost of living: 12 percent above average

Although it is one of the more expensive metro areas, Seattle lures millennials with higher paying jobs, especially in the tech sector. The median earnings for full-time working millennials is over $52,000 per year, and millennial families can save a lot by not paying any state income tax. Seattle is home to a number of Fortune 500 companies, including Amazon, Starbucks, and Microsoft.

3. Denver-Aurora-Lakewood, CO

  • Percentage change in millennial population: 21.3 percent
  • Percentage of population that are millennials: 19.6 percent
  • Median earnings among millennials: $45,504
  • Median home price: $356,642
  • Cost of living: 6 percent above average

Millennials in Denver make up 19.6 percent of the population. While homes do not come cheap here, millennials continue to move to the “Mile High City” in droves, increasing their population by over 21 percent from 2012 to 2017. The mountains and natural beauty are a big attraction as is the city’s strong job market. Surrounding suburbs boast excellent schools for millennials looking for more space outside the city. Skiing in the winter or mountain biking and hiking in the summer make the Denver area a very appealing place for active millennials.

4. San Francisco-Oakland-Hayward, CA

  • Percentage change in millennial population: 19.2 percent
  • Percentage of population that are millennials: 19.3 percent
  • Median earnings among millennials: $60,671
  • Median home price: $699,692
  • Cost of living: 28 percent above average

Known for its Golden Gate bridge, perpetual fog, hilly streets, and food scene, San Francisco is a popular city with millennials and boasts a healthy job market with high wages. If living in this world-class city itself is financially out of reach, the surrounding metro area offers some great suburbs with more affordable home options for young millennial families. There are plenty of activities to keep kids busy as well, from the Aquarium of the Bay to Golden Gate Park.

5. Austin-Round Rock, TX

  • Percentage change in millennial population: 19.0 percent
  • Percentage of population that are millennials: 20.6 percent
  • Median earnings among millennials: $45,504
  • Median home price: $277,517
  • Cost of living: 1 percent above average

Known as the “Live Music Capital of the World,” Austin is home to the highest percentage of millennials of any large metro. Austin also saw a big increase in its millennial population, which increased by almost 20 percent from 2012 to 2017. This fact is no surprise given the plethora of tech jobs, live music events, and outdoor recreation opportunities. The more affordable Austin suburbs offer millennials less expensive homes while still being close to everything Austin has to offer.

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Where millennials are moving from

1. Tucson, AZ

  • Percentage change in millennial population: -13.3 percent
  • Percentage of population that are millennials: 14.9 percent
  • Median earnings among millennials: $35,392
  • Median home price: $181,717
  • Cost of living: 5 percent below average

The southwest desert metro of Tucson saw a large outflow of millennials from 2012 to 2017, with over a 13 percent decline in the millennial population. Home to the University of Arizona, the area has a large student population and boasts warm weather, nearby mountains, and plenty of hiking trails. However, the relatively low median wage for millennials in Tucson is likely a turnoff.

2. Virginia Beach-Norfolk-Newport News, VA-NC

  • Percentage change in millennial population: -6.6 percent
  • Percentage of population that are millennials: 17.5 percent
  • Median earnings among millennials: $38,425
  • Median home price: $214,642
  • Cost of living: 2 percent below average

The Virginia Beach metro area is comprised of several coastal communities in southeastern Virginia. While millennials make up over 17 percent of its population, a large number of millennials left the area between 2012 and 2017, causing the millennial population to decrease by over 6 percent. Tourism plays a large role in the area’s economy, which doesn’t have the tech jobs that millennial hotbeds tend to offer. Lower median wages may also be a detractor for millennials looking to build their financial future.

3. Rochester, NY

  • Percentage change in millennial population: -5.3 percent
  • Percentage of population that are millennials: 15.6 percent
  • Median earnings among millennials: $40,448
  • Median home price: $140,692
  • Cost of living: 2 percent below average

Home to several prominent universities (University of Rochester and Rochester Institute of Technology) and a large immigrant population, the Rochester metro area lost over 5 percent of its millennial population. Millennials are leaving the area despite the affordability of homes and relatively low cost-of-living. Winters are harsh in this upstate New York metro area, but perhaps a number of incentives designed to attract businesses to the area will also bring in more millennials in the coming years.

Methodology & full results

The Pew Research Center’s definition of millennials is people born from 1981 to 1996. In 2012, the youngest millennials were still in their teens. In order to exclude those who were likely still in school, the analysis was done only on people who were at least 20 in 2012, i.e. born between 1981 and 1992.

Millennial population statistics and median earnings among millennials is from the 2012 and 2017 American Community Survey Public Use Microdata Sample (PUMS) datasets. Data on average median home prices (averaged across all months of the year) for 2017 is sourced from Zillow. Cost of living is from the Bureau of Economic Analysis’s Regional Price Parity dataset for 2017.

Metro areas are ranked by the percentage change in the millennial population from 2012 to 2017. These changes were tested for statistical significance (with 95 percent confidence) and only significant changes are shown. Only large metro areas with at least 1,000,000 people are included in the final rankings.

Haven Life Insurance Agency LLC (Haven Life) conducted this analysis for educational/informational purposes only. Haven Life is an online life insurance agency offering term life insurance issued by Massachusetts Mutual Life Insurance Company. Haven Life does not provide tax, legal, investment, or housing/real estate advice, and the information in the study should not be relied on as such. You should consult your own tax, legal, investment, and other advisors, as appropriate, before engaging in any transaction.

Real Rate is based on your application and third party data obtained during underwriting.

Haven Term is a Term Life Insurance Policy (DTC 042017 [OK1] and ICC17DTC in certain states, including NC) issued by Massachusetts Mutual Life Insurance Company (MassMutual), Springfield, MA 01111-0001 and offered exclusively through Haven Life Insurance Agency, LLC. Policy and rider form numbers and features may vary by state and may not be available in all states. In NY, Haven Term is DTC-NY 1017. In CA, Haven Term is DTC-CA 042017. Our Agency license number in California is OK71922 and in Arkansas, 100139527.

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