Compared to the rest of the nation, homeownership is lower across all age groups in the District. The largest differences are for millennials and while the gap narrows by age, it never fully closes. Millennial heads of households are nearly twice more likely to own the homes they live in across the entire nation compared to the District. There could be many reasons for this: high prices in the District, or delayed family formation for the millennials.
We already know that the prices in the District are high, and there is some evidence that millennials are delaying forming households. Here is how we see it: The recent population boom in the District can be largely attributed to inflow of young people. Of the nearly 75,000 net increase in resident population between 2000 and 2013 (the latest year for which age breakdown of the population is available), 51,000 come from those between the ages of 20 and 34 (comparable to today’s millennials who were between the ages of 18 and 34 in 2014). This group now constitutes 32 percent of the total population compared to 27 percent in 2000.
However, millennials of 2014 are not forming households as fast as their comparable age group did back in 2000 (today’s Gen-Xers). Those under the age of 34 added more households to the District compared to older groups between 2000 and 2013, but each net increase in resident population in this age group resulted in a net increase of 0.5 new households headed by a similarly aged person. In contrast, those between the ages of 35 and 55 added about 3,000 new residents, but more than 17,300 new households. That is an increase of 5.6 households for one new resident from this age group.
Homeownership plays a role in this dynamic. For the young people under the age of 34, homeownership rates increased between 2000 and 2005, and suffered since then, first through the great recession and once again since 2011. This probably has to do with steep increases in home prices beginning early 2000s. In contrast, those between the ages of 35 and 54 defied the Great Recession, increasing their ownership rates by more than 4 percentage points (just as comparison, ownership rates for this age group declined by 6 percentage points since the great recession across the entire nation).
This is yet another picture of gentrification. We sometimes think of gentrification as something driven by young people. They move in, drive up rents and force low-income families out. This data suggest, however, that the changing profiles of Gen Xers might be another key driver of socioeconomic changes in the District. The dynamics of population for those between the ages of 35 and 54 suggest a great churn, with a small net increase in population but a large increase in household formation and homeownership, suggesting that the newcomers in this age-group are probably wealthier than those who leave.
What exactly is this data? Population data by age groups is from the U.S. Census. Homeownership and income data are extracts from the Current Population Survey data maintained by Miriam King, Steven Ruggles, J. Trent Alexander, Sarah Flood, Katie Genadek, Matthew B. Schroeder, Brandon Trampe, and Rebecca Vick. Integrated Public Use Microdata Series, Current Population Survey: Version 3.0. [Machine-readable database]. Minneapolis: University of Minnesota, 2010. The post uses the generation definitions from Pew Research Center.