A generation or two ago, Seattle was known by many as a soggy outpost, a maker of airplanes and a creator of music from Quincy Jones to Jimi Hendrix. As historical roots slowly fade, new storylines are unfolding that arguably paint a breathtakingly bright future for the city.
The evolution of this new generation got its start in the 1990s with Microsoft and its explosive growth of business and personal software products (Windows 95, anyone?) that has since penetrated every corner of this planet. Boeing expanded its global presence (but moved its HQ to Chicago), startups Amazon and Expedia slowly developed into digital powerhouses, and now Bay Area behemoths Google, Facebook and Apple are all taking a bite out of the Rainier cherry by firmly planting their footprint in our region.
The days of a sleepy logging and cannery town, a plane-making blue-collar city, or a regional shipping port have taken a backseat to a tech takeover only seen once before (um, Silicon Valley, hello!). But who are the new Seattleites?
The busy streets here – particularly around Amazon HQ – have a gleaming new look and feel. It’s a city led by a wave of fresh-faced millennials flocking here in search of opportunity. We are evolving into a region of highly skilled tech worker bees buzzing around hives in Seattle, Redmond and Bellevue.
According to a new report compiled by the National Association of Realtors ® (NAR), Seattle ranks third in the nation for population growth of millennials (most experts would say aged 25-39). The report analyzed employment gains, population trends, income levels and housing conditions in the largest 100 metro areas to identify the most popular for this group born between 1980 and 1994. Only Madison, Wis. (75%), and Grand Rapids, Mich. (73%), have higher percentages of millennials moving to their cities.
A full 70% of new Seattleites are millennials, NAR said, and of the city’s total population nearly 29% are of this growingly influential generation. (For comparison, millennials comprise an average 25% of a typical metro area’s population.) From 2007-2017, Seattle saw 69,000 millennials arrive, a growth rate of 43%.
Census data released in June show the median age of King County residents that moved from out of state within the past year is 28, boosting the count of millennials living in Seattle to roughly 228,000. All told, there are 590,000 millennials in the county, or 26% of its 2.3 million residents. The county’s median age is a low 36.9 years.
We can easily point to the increased demand for skilled tech jobs in the region for our sharp rise in population. In fact, 42% of all office jobs here are in the software and services industries. In addition to Microsoft, Boeing, Amazon and Expedia, the region is an IT magnet for industry notables F5 Networks, Tableau, Zulily, Concur, Smartsheet and other companies that started here. In many cases, these businesses are competing for the same type of employee and forcing salaries higher.
Seattle’s median income is $79,656, according to the most recent Census data, and Hired.com said the average Seattle tech salary is $138,000, a 10.4% jump since 2015, the second-highest tech salary market in the U.S. behind the Bay Area.
Overall, data show 40% of Seattle households can afford a home priced $695,000 (a typical median figure for this area) – tied with San Diego as the fourth-most challenging residential real estate market in the U.S. after California neighbors San Francisco, San Jose and Los Angeles.
Millennials of all stripes who recently moved to the area earn a median income of $68,900 and they can afford to buy only 5% of the homes on the market (as of March 2019). Nine percent of all Seattle-area millennials can currently afford to buy a home, according to the NAR report. (In 2017, the median rent for all of Seattle ate up 29% of household income – little changed this decade.)
There is evidence, however that with time and an accumulation of savings, millennials are seeking their dream homes. In a national survey from 2017, buyers younger than 35 purchased nearly a quarter of homes constructed by Toll Brothers, the largest luxury homebuilder in the U.S. And NAR reported one-third of all millennials expect to buy a home within the next two years. (My monthly newsletter recently focused on the widening gap between income and home prices in Seattle and nationally. You can sign up for my newsletter!)
Not surprisingly, millennials embrace technology. They live with their screens and leverage hundreds of apps to consume information and purchase goods & services. Some 54% of them across the U.S. would apply or already applied for a mortgage digitally (the second largest group after Gen X, at 58%), according to a Bank of America Home Buyer Insights Report.
The same report said first-time millennial buyers have a fear of missing out (FOMO) when they see their friends post pictures on social media of newly purchased homes. When asked about their feelings in this social scenario, millennials say “If (their friends) can buy a home, then why can’t I?” (33%) and express FOMO (25%). More than half (53%) of millennials said they would share on social media when/if they bought a home for the first time – a higher percentage than if they had a birth announcement or got a new job.
Many millennials are interested in living in neighborhoods where they can mingle with like-minded individuals and stroll to restaurants, community spaces and entertainment hubs. For longer treks, they may also prefer to commute via public transportation or use rideshare services.
The picture of Seattle’s future is still coming into focus but it’s safe to say the city and its people will be younger, tech-centric, home buyers and likely very successful for years to come.