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More Unmarried 40-Year-Olds, More Multifamily Demand?
The United States has marked a new milestone: 25% of its 40-year-olds have never been married. To put that in perspective, in 1980, only 6% of Americans aged 40 had never been married.1
So, what could this mean for the housing sector? Multifamily communities could potentially experience surging demand from all those single adults.3.
Fewer combined households
Today, roughly 14 million people age 40 and older are unmarried, with more single and unattached men than women.2 While this is an interesting fact to be sure , the fact that may be of importance to those in the commercial real estate industry: the vast majority of 40-year-old plus single people live alone.1
Indeed, this decades-long trend of delaying or foregoing marriage will likely continue to have implications for the housing sector. If this trend continues, the U.S. could potentially see fewer combined households and far more demand for housing designed for single occupants.3
Properties with a significant portion of studios and one-bedroom floor plans in their unit mix, as well as more affordable properties, could potentially experience the strongest demand. Individuals who live alone typically bear the brunt of all financial obligations, which could make them more price sensitive.3
The 'singles tax'
It's no secret that it is expensive to be single. In fact, there's even a term for it: 'singles tax'.5
While living alone may have its perks '“ you likely never have to share the bathroom (or the TV remote), for example '“ many people commonly agree that being single can be expensive because of the 'singles tax'.5
The average U.S. dweller spends about $48,000 a year, with nearly $17,899 allocated to housing costs, according to the U.S. Bureau of Labor Statistics' Consumer Expenditure Survey of 2021.4
Meanwhile, the average married couple's annual expenditure is around $76,000, with $24,811 dedicated to housing. This translates to an individual share of $12,405.50 in a couple for housing, meaning that cohabiting married individuals save nearly $5,500 annually on housing expenses compared to their single counterparts who live alone.4
Most and least expensive places to be single
For single renters specifically, they have to pay a yearly 'singles tax' of nearly $7,000, according to an analysis by Zillow. To that end, cohabitating renters in the U.S. save a collective $14,000 annually, compared to renters living alone.5
While singles across the country pay a high price for a solo living arrangement, the size of that 'singles tax' varies widely depending on where they live. The price of living alone in a one-bedroom apartment is the highest in New York City,6 where singles pay $19,500 more a year than someone living with a partner in the same place, with San Francisco not too far behind with a $14,000 'singles tax' for a one-bedroom apartment.5
Of the 50 largest U.S. cities (by population), Detroit and Cleveland have the lowest "singles tax" at $4,483 and $4,387 respectively.5
Final Word
The decline in the marriage rate among 40-year-olds could possibly present an evolving landscape for multifamily housing demand. It may underscore the need for developers, urban planners, and policymakers to consider these trends when designing future residential spaces and community development plans.
2https://www.census.gov/newsroom/stories/unmarried-single-americans-week.html
5https://zillow.mediaroom.com/2023-02-13-Renters-pay-a-singles-tax-of-nearly-7,000-for-living-alone
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