These States Lead in Young Adult Homeownership

Texas, California, and Florida are the top three states in the country with the highest number of young adult homeowners, according to a Chandan Economics analysis of data from the U.S. Census Bureau’s American Community Survey. These states have the most households headed by someone under 35, the most homeowners under 35, and generally the most renters of the same age group.

Chandan said states with the largest populations of young adult households naturally tend to have more young adult homeowners. The analysis said that observing where young homeowners make up a higher or lower share of all households provides a more valuable understanding of how this age group impacts the purchase and rental markets.

Texas had about 814,000 homeowners and 1.7 million renters under 35, California had roughly 625,000 homeowners and 1.8 million renters, and Florida had 514,000 homeowners and 902,000 renters among people under 35. New York and Illinois ranked fourth and fifth, with 370,000 homeowners under 35 and 380,000 homeowners in this age range, respectively. Ohio, Pennsylvania, North Carolina, Georgia, and Michigan rounded out the top 10.

The states with the highest share of homeowners under 35 as a percentage of all households may reveal where young, first-time homebuyers face fewer barriers to ownership. Utah, Alaska, and Iowa lead this category with 11.6%, 10.2%, and 10.1% of homeowners aged under 35, respectively. North Dakota, with 10%, and Wyoming, with 9.6%, rounded out the top five.

Chandan noted that the share of households under 35 is also relatively high in each of these states, with younger adults making up at least one-fifth of total housing demand in all cases. The report said housing demand has flowed from high-cost to high-affordability markets for the past decade in search of attainable home ownership, particularly during the pandemic.

Labor market dynamics also play an important role, as evidenced by the D.C. market, which has a high density of households headed by people under 35 despite having a low density of under-35 homeowners. States that rank in the bottom ten for the share of under-35 homeowners are among some of the highest for average hourly wages, including D.C., which is the lowest in under-35 homeowner density.

“For early-career professionals, the earnings boost and experience gained by living in a high-cost market outweigh seeking affordable homeownership opportunities elsewhere,” said the report. “The other states with low shares of U35 homeowners as a share of all households follow a similar high-opportunity, high-cost mold — including California (4.6%) and New York (4.8%), followed by Hawaii (5.1%) and Nevada (5.4%).”