The real estate investment firm analyzed 46 metro areas with a population of 1 million or greater to determine the best places for millennials to rent or buy a home. While Austin doesn't make the cut among the best places to buy — no surprise there — Central Austin, specifically 78705, appears at the top of the list of the best places to rent.
"We know that millennials would like to own a home, but we also know that they struggle to find suitable for-sale options near major employment centers due to high home prices and low inventory," says Steve Hovland, director of research, in a release. "To help millennials with their housing predicament, we created a comprehensive list of ZIP codes that are the most affordable with excellent public schools, and also have the shortest commute times to job centers."
The study considered public school ratings, commute times, and affordability. For the best places to buy, the monthly mortgage could not exceed 28 percent of median household income. For the best places to rent, a rent-to-income ratio of 2.5 times was used.
Central Austin ranks No. 3 on the rental list, coming in just behind submarkets in Milwaukee and Louisville, Kentucky. The 78705 ZIP code boasts a public school rating of 86 and an average commute time of 33 minutes. Monthly rent is $1,904, 39 percent of the median household income of Austin-area millennials.
Austin is the only Texas metro to appear on either list. Millennials who want to achieve the dream of homeownership should consider submarkets in St. Louis; West Palm Beach, Florida; Pittsburgh, Cleveland; and Oklahoma City, the top five metros on the list.