Gen Z renters are helping redefine housing hotspots. In just five years, the number of Gen Z renters increased sixfold, surging from 700,000 households nationwide to 4.4 million, according to a new report from RentCafe.
While most of this demographic is still renting, the number of home buyers in their 20s is starting to grow. To understand where these young adults are renting and buying, RentCafe analyzed nearly 100 metros with at least 15,000 Gen Z households to find the locales with the biggest gains.
Southern metros are leading the growth for these renters. Birmingham, Alabama, tops this list, with Gen Z renter households growing 13 times in five years, reaching about 18,000 in 2023. RentCafe calls Birmingham “a small big city,” offering a lower cost of living with diverse entertainment options and growing business opportunities.
Raleigh, North Carolina, follows, boasting significant income gains for young renters alongside abundant job opportunities. In this college town, 9 out of 10 Gen Zers rent.
Buffalo, New York; Nashville, Tennessee; and Denver round out the trending metro areas for Gen Z renters.
New York, at No. 12 of the trending metros for Gen Zers, boasts the largest number of younger households nationwide—nearly 280,000.
In addition, RentCafe identified the metros where nearly all Gen Zers rent, with five from California making the top 20 with the highest shares of young renters. Even as incomes went up, homeownership was still out of reach for many. San Jose topped the list, with nearly 95% of the demographic renting, with San Francisco coming in at No. 4, San Diego at No. 7, Los Angeles at No. 8, and Sacramento at No. 17.
College towns also saw a higher Gen Z renter share. Lafayette, Indiana, ranked second on the list with a high concentration of younger renters at nearly 94% of the share. College Station, Texas, and Gainesville, Florida, also made the top five.
What are the trending metros for Gen Z home buyers? According to RentCafe, smaller and mid-sized metros in the South and Midwest are dominating. However, Tucson, Arizona, comes in at No. 1, comprising 6,000 Gen Z owner households in 2023 and touting a more affordable housing market compared with nearby Phoenix.
Jacksonville, Florida; Dayton, Ohio; Omaha, Nebraska; and Lafayette, Louisiana, round out the top five for Gen Z owners.
For the largest share of Gen Z homeowners, Ogden, Utah, just north of Salt Lake City, tops the list. Other hotspots on the list include Detroit; Birmingham; Jackson, Mississippi; Greenville, South Carolina; Wichita, Kansas; Louisville, Kentucky; St. Louis; Omaha; and Winston-Salem, North Carolina.