How Did the Housing and Labor Market Crises Affect Young Adults' Living Arrangements?

Anne E. Winkler, University of Missouri, St. Louis
William Rogers, University of Missouri, St. Louis

The housing and labor market crises of the late 2000s “caught” young adults between the ages of 22-34 in very different situations. During the depths of the crisis, young adults who were not yet homeowners may have responded by doubling-up (or continuing to do so) or renting. (And, they may have subsequently purchased once prices fell off so considerably). On the other hand, those who bought homes at the peak of the bubble (generally those who were somewhat older) experienced a very different situation and may have found themselves “underwater.” In this study, we exploit data that varies by time (2005-2010), place (MSA), and individual (using ACS data) to investigate the impact of these recent crises. In modeling macroeconomic conditions, we 1) take account of the fact that the timing of the housing and labor market crises differed within and across MSAs; and 2) examine a measure of acute housing distress—foreclosures.