What with employments prospects looking ever gloomier for thousands of young adults across the nation, it’s little wonder that more of them are moving back in with mom and dad in an effort to cut housing costs.
Recent data from the latest U.S. Census showed that young male adults in particular were finding moving back home a more enticing prospect than struggling on their own two feet, with 19% of males between the ages of 25 and 34 living at home. This marks a 5% increase on the number who loved with their parents in 2005. Meanwhile, 10% of women in the same age bracket also live at home, an increase of 8% on 2005.
Moody’s Analytic’s Mark Zandi said that the figures were cutting into the formation of new households significantly, and points out that an estimated 150,000 less households are being formed each year than what is considered to be a healthy number for the economy.
Housing markets are feeling this decline in new household formation, and in some areas this is thought to contribute to the ever decreasing home values, according to a report in CNN Money. The report points out that even the rental market could be doing a lot better if only young adults would rent homes instead of moving back in with their parents.
Lawrence Yun, the chief economist of the NAR said that things would be much brighter overall if these young adults would move out and rent:
“If more young adults were in the market for rentals, rents would rise and higher rents can tip some households [of all ages] into buying homes.”
Grown up child moving back home also has wider implications, reports CNN Money. With children shacking up with mom and dad for longer, those parents are being prevented from downsizing – selling up their current homes and moving into newer retirement homes.