Studies show that with the current real estate market, college graduates are choosing to move back home to save money before they have to get their own place.
A study from GOBankingRates revealed that there are 40 cities in the U.S. that could be poised for a housing crisis.
This study along with Experian's nationwide study that explored young adults’ biggest challenges over the past year and their future outlooks as they relate to finances, shows that parents shouldn't be surprised if their college graduate plans to move back home.
In June of 2021 Experian, the credit reporting company, conducted a study where they surveyed more than 2,000 recent graduates from around the country and found that 30% of graduates claimed to have just moved back in with their parents.
This is common among the boomerang generation, a term coined due to how common it is for current college graduates to move back home.
According to the Pew Research Center, 15% of millennials ages 25-35 moved back home in 2016, which is a far higher percentage than previous generations who were the same age.
Now more than ever this makes sense for young adults since the real estate market for homes and apartments has risen exponentially. National asking rents rose over 10% in August alone, the first double-digit increase in a single month in the more than 20 years of data analyzed by RealPage, a rental management software company.
Experian found that college graduates are moving back home to regroup, save money and plan for the future. When asked specifically about their finances 64% of recent college graduates surveyed reported feeling positive.
However, the Pew Research Center found that today's young adults are more likely to stay home for an extended period of time.
Sandy Fowler, a business owner who is deeply engaged in the inner workings of the parent-teen dynamic, suggests that parents set clear boundaries for their children returning home, including when they will move out.
Experian's study also showed that recent college graduates are more financially conscious than older generations. 46% of those surveyed said they are checking their credit scores more often, 44% are paying off credit card debt sooner than they may have expected, and about 20% said they have considered investing their money.
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