Gen Z is reviving urban hotspots assumed to be dying out due to Covid-19, a new report from RentCafe found.
Gen Z is the only generation to see a spike in renting activity in the last year, up by 21% while the share of rent applications from all other generations dropped.
They account for a quarter of all rent activity nationwide and pushed the number of applications for apartments from renters of all generations up an average of 10%.
In 2020, Zoomers were stuck in their families’ hometowns or in their college towns. But now, following promises of job opportunities and vibrant living, they’re renting in cities once thought doomed in the wake of the pandemic. Compared to 2020, there were 220,000 more Gen Zers who applied for an apartment in 2021.
In major urban hubs like San Diego, Los Angeles, and Philadelphia, a quarter of rental applicants are Zoomers.
“Big cities are appealing for a host of reasons—big cities offer diverse job opportunities. Big cities offer many amenities that are not available in smaller cities or rural areas, from dining and entertainment options to public transit, to services like gyms and spas,” said Nicholas Dempsey, Associate Professor of Sociology at Eckerd College.
“And big cities offer opportunities for social networking—whether Gen Zers are looking for professional colleagues to bounce ideas off of, or romantic partners, they’re more likely to find someone to connect with, in a big, dense city.”
San Francisco saw the biggest jump in Zoomer rent activity, with a 101% increase YOY. But Davis, CA, holds the crown with the largest share of Gen Z renters at 69%, overtaking the once-winner Boulder, CO. This is the result of increased enrollment at the University of California.
East coast financial centers are also attracting attention, with Jersey City seeing a 95% change in share and Manhattan seeing a 63% increase in Zoomers YOY, the second and third trendiest cities for the generation.
Though Millennials continue to dominate the market, with a 45% share of the generation renting, Gen Z is catching up fast. Of the 3.2 million applications for apartments analyzed, 27% were from Gen Zers, up from 23% in 2020.
Millennials, meanwhile, saw the largest drop, down 8% YOY.
But renting isn’t the only area Zoomers are leaping into. They’re also jumping headfirst into the homebuying market, doubling their homeownership between 2019 and 2020. A majority of them, 86.2%, want to own a home one day, and of those, 45% are looking to buy their first home in the next five years.
But the affordability crisis may stifle those dreams. Gen Z buyers can’t afford a median-priced home in any of the 100 largest US counties, according to data from Point2, a real estate database.
“From as much as $1 million to a little more than $40,000, the price difference between the median home and the home that Gen Zers can actually afford opens a not-so-metaphorical precipice between young people and their homeownership dreams,” Point2 researchers wrote in a generational study.