Why Do Young Adults Co-Reside with Their Parents?
Why Do Young Adults Co-Reside with Their Parents?
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CRIS Scientific Seminar 2023-2024
Friday, February 2nd 2024, 11:30 am
Sciences Po, Room K008 (1, St-Thomas-d'Aquin)
Why Do Young Adults Co-Reside with Their Parents?
Arthur Acolin
Associate Professor, Runstad Department of Real Estate,
College of Built Environments, University of Washington
Nearly one in every two adults aged 18–29 currently lives with their parents in the US, compared to slightly more than one in four in 1960.
The literature focuses on changing labor market conditions and marriage- childbearing delays to account for this shift.
Using a Blinder-Oaxaca procedure, we identify a role for housing affordability, measured by market level median housing rent or price to median household income ratios, as an additional factor in the increase in co-residency since but not before 2000.
We endogenize the marriage-childbearing decision with a Heckman selection model and attribute up to a quarter of the observed 9-percentage-point increase in the co-residence share between 2000 and 2021 to a decrease in housing affordability.
We find a non-linear relationship between affordability and co- residence with the relationship strongest in the least affordable metros where affordability constraints might be more binding. Overall, these results show changes in market level housing affordability are associated with the increase in young adult co-residence in the US over the first two decades of the 21 st century.
(Co-authors: Desen Lin, Cal State Fullerton, and Susan Wachter, University of Pennsylvania)
