Are Millennials Willing to Spend Most of Their Income on Housing?

Death, as millennials have taught us, is life in the suburbs.
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New York City. (Photo: Anthony Quintano/Flickr)

New York City. (Photo: Anthony Quintano/Flickr)

Welcome to the 18th annual Northern Colorado Real Estate Conference. In this session, four real estate experts discuss the issue of gentrification along the Front Range. Threading the theme:

David Schwartz, an economist and vice president in the Denver office of Economic & Planning Systems Inc., a land economics consulting firm, said incomes have not been keeping pace with the increased cost of housing. ...

... Nick Hansen, managing partner and broker at The Group Inc. in Fort Collins, said Millennials, those in their 20s and early 30s, are exacerbating the problem in urban areas.

“Millennials are willing to pay 50 percent of their income on housing so they can live in urban settings. That drives up rents and pushes out others who can’t afford that,” Hansen said.

David Everitt, CEO of Everitt Enterprises Inc. in Fort Collins, said part of solving the shortage of affordable housing is to increase the wealth of buyers. “Private businesses need to become involved,” he said. ...

... Bruce James, a shareholder with Denver law firm Brownstein Hyatt Farber Schreck, added, “We need housing that employees can afford. It’s hard to draw companies into Colorado compared with other regions. They need to know there is affordable housing available for their employees.”

Bruce James stands out from David Schwartz, Nick Hansen, and David Everitt. The latter three frame housing affordability as a demand problem. James, charitably, offers up housing supply as the concern. Suffice to write, ironic to read real estate experts at a real estate conference grumbling about the growing clamor for residences of any kind.

Nick Hansen paints a picture of irrational millennial migration. No rent is too damn high. Give me city living or give me death. Death, as millennials have taught us, is life in the suburbs. Roll Arcade Fire video clip.

Around the world, millennial urban liberty spurs gentrification:

In a 10-city study released Monday, Cushman finds that the explosion of new offices and condos in downtown cores is taking place from Mexico City to New York, Chicago and Washington, driven largely by millennials keen to live close to their work.

Wherever this kind of real estate demand goes, displacement follows. Millennials cry for more density of the kind of residential units that 50 percent of income can afford. Transit-oriented gentrification (T.O.G.), suburbanites scream for a right to the city.

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