According to Morgan Stanley, nearly half of young adults aged 18 to 29 in the US reside with their parents, a trend that has implications for luxury goods companies.
Census data indicates that the proportion of individuals moving back in with at least one parent surged to 49.5% during the peak of the COVID-19 pandemic in 2020, and although it has slightly decreased to 48% in the following year, the bank predicts it will persist in 2022 amid the transition to hybrid work setups.
This living arrangement enables young adults to allocate more disposable income to discretionary expenses such as travel, entertainment, and luxury items. Morgan Stanley analysts highlighted the significance of this demographic shift, driven by financial concerns like rising rental costs and sociological factors such as prolonged education and delayed marriage.
A Property Management survey of 1,200 Americans aged 26 to 41 in December revealed that a quarter of them live in their parents’ homes, with 55% having returned within the past year. The main reasons cited for this arrangement were the desire to save money and the inability to afford rent.
Despite nearly 40% of millennials living at home reporting that their parents charge them rent, almost half of them pay less than $500 per month, allowing for significant savings compared to the national median rent of $1,980 per month according to Rent.com data from October.
