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If you’re a fan of shows like Friends or New Girl, life with roommates might look like a roller coaster of laughter, romance, and camaraderie. Rarely, though, do we consider the economic conditions—the tight housing markets in New York and Los Angeles, respectively—that brought those characters under the same roof.
More millennials (typically characterized as those between the ages of 25 and 34) are living with roommates than ever before, and we’re pretty sure no one told them life was gonna be this way. Between 2005 and 2013, the percentage of young adults sharing living space shot up by nearly 40 percent nationwide, according to a recent analysis by Make Room, a nonprofit renters’ advocacy group. Almost 12 percent of Coloradans in this age group have roommates, a figure that ranks second in the country, behind Massachusetts.
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Entry-level salaries and cost of living have always limited housing choices for young adults, and it’s likely that some elect to live with roommates simply because they enjoy the company. But these limitations can become self-reinforcing in cities with tough housing markets, leaving some young adults with little choice in the matter.
“What those numbers reflect is that there’s an economic cost to millennials in that they cannot save and are having to live in the moment, day to day, month to month,” says Tiana Patterson, state and local programs officer for Enterprise Community Partners, an affordable housing nonprofit that co-sponsored Make Room’s analysis. “If you’re 22 and you want to have a social support system, that’s great, but I’m 32, and that’s not something that appeals to me.”
Increased cohabitation appears to be a natural response to the housing crunch here in Colorado. More than 26 percent of residents sink more than half their paychecks into rent and utilities, a level that housing experts consider a severe burden. This results in a loop of rising rents: As roommates become the norm, developers can charge more per square foot for apartments that in more relaxed rental climates would have attracted a single person or couple. The outcome of this cycle is often displacement of lower-income residents, or gentrification.
Patterson notes that millennials aren’t the only demographic cohabitating as a result of our dearth of affordable housing. Colorado’s growing population—more than 100,000 new residents have moved here since 2000—means that families and individuals of all ages, especially those living in lower-income communities, have been forced to double or triple up, as well.
According to a recent Pew Research Center study, a proportion of young people (and young women in particular) are now living with their parents. “While young adults are increasingly likely to live with roommates, far more young adults live with their parents,” economist and real estate analyst Jed Kolko told 5280 via email. “The likelihood that young adults live with their parents accounts for the bulk of the ‘doubling-up’ phenomenon. Doubling-up, if anything, has held back housing demand since it reduces household formation.”
Andrew Jakabovics, senior director of policy and research for Enterprise Community Partners, says the impermanence of such arrangements guarantees demand for housing will stay strong as long as young adults do eventually move out. Additionally, more young adults are staying in the rental market longer instead of purchasing a home—either out of necessity or caution—which also contributes to the stressed rental market. First-time home buyer numbers are at their lowest in three decades, according to the a recent report from the National Association of Realtors.
Solutions for the rental crunch are far from clear, but Patterson praised recent citywide initiatives that acknowledge the problem and take steps to preserve and increase the affordable housing supply. Mayor Michael Hancock unveiled a five-year plan for affordable housing in October 2014, and over the summer, he announced plans to generate $15 million in dedicated annual revenue, starting in 2017, for housing initiatives. This fund is meant to counteract a 31 percent decline in Housing and Urban Development (HUD) funding since 2010. Together, these efforts would help the city preserve existing affordable units and the funds to rehabilitate and build 6,000 new ones. But the plan’s focus must remain flexible, Patterson says, in order to adequately serve the demographics affected by the housing shortage, including seniors and veterans.
If this five-year plan works, Denver residents will still be able to tell their friends and family, “I’ll be there for you,” even if that doesn’t mean sharing a bedroom wall.