Youthification: how age affects property values in urban centers

While the age of renters and homeowners in a neighborhood doesn’t directly impact property values, there’s a definite correlation between concentrations of young, working-age people and higher housing costs.

The reason for this is that young people across North America are moving out of small towns and rural areas to settle in and around cities. (In large part, this is due to the increased abundance of jobs found in such areas.) As more young people move into urban centers and the surrounding suburbs, the demand for property in these areas goes up, resulting in higher housing costs.

Cities with skyrocketing real estate markets, such as New York and San Francisco, tend to likewise be places where there are high concentrations of young professionals and fewer people under the age of 18 and over the age of 65.

When lots of young, white-collar workers start moving into a neighborhood, it’s often a sign that property in that area will start going up in value. Some researchers call this effect on urban environments youthification.

The areas where housing is most affordable tend to be smaller communities where there are fewer numbers of working-age people and larger numbers of children and elderly residents. In these places, the demand for real estate is not as high, which makes housing costs more manageable.