Housing Is Scarce in Portland Because Millennials Are Surprising Demographers by Settling Down

For a long time, demographers expected millennials to go their own way through life’s milestones, especially when it came to housing.

They expected people born between 1982 and 1996 to continue living in apartments with few belongings beyond a futon (for sleeping) and an iPhone (for everything else). They didn’t expect them to form households—and buy houses.

But, when it comes to housing, millennials might be just like the rest of us. And it might be why demand for housing is so high in Portland, according to Josh Lehner, an economist for the state of Oregon.

Related: You can’t afford this house.

By some accounts, PDX shouldn’t be facing a housing crunch. Depending on the source, Lehner says, the population here ranges from modest growth to small losses. The U.S. Census Bureau says the Portland metro area’s population dropped 0.2% in the year ended July 2021, to about 2,511,612. Multnomah County saw a bigger drop: 1.5%.

Even so, supply could be tight because new construction is falling faster than the population, Lehner says. More likely, he says, prices are up because millennials, also known as Generation Y, are settling down. Now aged 23 to 40 roughly, they are at the nesting stage.

“Millennials are now the key demographic and overall driver of the economy,” Lehner wrote in his blog today. They are the biggest generation alive both in the U.S. and in Oregon now. Specifically, the single most common age in Oregon today is 31, and the five largest single age groups are 29, 30, 31, 32 and 33, Lehner wrote in an earlier blog.

All those folks are at ages where “headship” happens: One becomes a householder, or head of household. Headship appears to be happening en masse for 20- and 30-somethings in Stumptown, Lehner says. The increase is equivalent to adding 15,000 to 20,000 more households in the Portland area.

“That is a huge increase, equal to more than a full year’s worth of new housing construction,” Lehner writes.

Millennials are often called the “unluckiest generation.” Many millennials entered the workforce just after the 2008 economic crisis, when jobs were scarce. Apartments were tough to find, too, because developers got smoked by the mortgage collapse. And, as the most educated generation in history, according to The Atlantic, Generation Y also had a ton of student debt.

Now, they face a housing shortage, in part because so many of them are buying.

At least there’s good stuff on television.