Why Millennials Will Move to Chattanooga Over NYC
Debt-ridden millennials could turn their backs on expensive cities such as New York and San Francisco in favor of Detroit, Milwaukee, and Chattanooga, Tenn. in the search for affordable homes and good schools
Millennials struggling under the weight of student debt could increasingly turn their backs on expensive, gateway cities in favor of cheaper secondary—and even tertiary—markets such as Milwaukee and Chattanooga, Tenn.
With total student loan debt in the U.S. standing at more than $1.23T as of the end of 2015 and delinquencies among the 43.3 million borrowers rising to 11.6 percent during the final quarter of 2015, according to the Federal Reserve Bank of New York, concerns are mounting that cities such as New York, Los Angeles, and San Francisco will become unaffordable for many in the near future.
RSM US LLP principal Michael Schwartz says that as millennials start to buy homes and cars and to plan for families, some will be left with no choice but to move out of expensive cities.
“Detroit—real estate is so inexpensive there. People are moving there. Milwaukee, Chattanooga, Tenn., these are very, very hot markets for millennials and younger people[who] can afford living there.”
Education, Schwarz says, is one of the key reasons for deciding whether to move out of a city or not. “People are having kids later [but] when they do [have children] they want better education.
“In New York City, public schools are very tough to get into. Preschools are very tough to get into you. So what do you do? You move to the suburbs, where it’s a little more affordable.”
Watch the full interview here.
Soaring student debt obligations could force millennials out of expensive cities and into more affordable secondary—even tertiary—markets across the U.S.