A Combination of High Income-to-Rent Ratio, a Graduate-friendly Job Market and Appealing Lifestyle Make These Metros the Top Markets for Recent College Graduates

SANTA CLARA, Calif., May 7, 2024 /PRNewswire/ — For graduates evaluating where they’ll make their mark on the real world after college, Austin, Texas may offer them the best option for living, working and camaraderie amongst their peers.  In a new report, Realtor.com^® uncovered The Top Markets for Recent College Graduates and Austin ranked #1, followed by Bloomington, Minn. and Pittsburgh, Pa. to round out the top three.

“Graduating college is a major accomplishment, and, as commencement speakers often point out, also the beginning of a new chapter. Graduates have a lot to consider when deciding where to start that next phase. Considerations like finding an affordable place to live, positive job prospects and a nice lifestyle, are all important and it can be tricky to balance each of these factors,” said Danielle Hale, Chief Economist of Realtor.com^®. “Renting is more affordable than buying in the short run and can be a great option, especially when life right after college is usually marked by navigation of uncertainty and personal and professional growth.”

Top Rental Markets for Recent College Graduates

The Realtor.com^® analysis of Top Markets for Recent College Graduates uncovers the places in the U.S. where the class of 2024 can find a healthy mix of affordable renting options, job opportunities, and appealing lifestyle based on the following metrics:

Affordable Rent

Realtor.com^® calculated the ratio between rent and income for households between the ages of 25-34, which represents how much of their typical gross income is allocated to housing expenses. A low ratio is better as it suggests the housing costs take up a smaller portion of the monthly paycheck. Among the top 10 markets, the rent-to-income ratio spans from 19.9% to 26.7%. Bloomington, located within the Minneapolis-St. Paul–Bloomington metro area, emerges as the most affordable top-ranked rental market among the top markets with a ratio of 19.9%.

Plenty of Choices 

For recent college graduates starting a fresh new post-grad life, finding an apartment to rent can be tricky, if there aren’t many options available it becomes even harder. Realtor.com^® calculated a proxy for rental availability by measuring vacancy rates. Higher vacancy rates means a market could offer more options to choose from while potentially tapping into bargaining and negotiating with landlords because of the high supply. Out of the top markets, Austin within the Austin–Round Rock metro area (9.0%), boasts the highest rental vacancy rate.

College-Graduate Friendly Jobs 

When moving to a new city after college, graduates are looking for opportunities to kick start their career. In the Realtor.com^® list of Top Markets for Recent College Graduates, people may encounter less difficulty entering the workforce and securing positions that match their skills and qualifications. To define these roles, Realtor.com used data from the Bureau of Labor Statistics, categorizing occupations that require a bachelor’s degree but no prior experience as recent college-graduate friendly. Austin, Texas, home to many tech-fueled company offices, leads with 29.6% of occupations in this category in the surrounding metro, followed by Raleigh, N.C. with 28.8%, and Bloomington, Minn. with 26.7%.

Job Stability 

How well one can kick start their career is an important aspect that many college graduates consider when moving to a new city. Another aspect is how well they will be able to grow their career, and whether the area boasts a stable job market. A lower forecasted unemployment rate suggests that recent college graduates could encounter less competition when seeking employment, and better job security, which will help to launch their careers and achieve their professional goals. In the Realtor.com^® report, Bloomington, Minn. is forecasted to have the lowest unemployment rate in 2024 (3.1%) among the top 50 metros, followed by Austin, Texas with an unemployment rate of 3.3% in the surrounding metro.

Opportunities for Job Growth 

To measure job opportunities, Realtor.com^® used the Indeed Job Posting Index, which details the change in job openings compared to pre-pandemic baselines. A higher index for a market indicates a healthy number of opportunities; recent graduates can use the index to identify whether a place can offer positive job growth in the future. Within the top 10 markets, the index ranged between 114 and 166. Specifically, Scottsdale, Ariz. (an average index score of 166) experienced the highest increase of job openings when compared to the pre-pandemic period.

Surrounded by Peers 

When moving to a new city, college graduates looking to make new friends and encounter people in similar life stages may turn to places with a good amount of peers who can provide a supportive environment, networking opportunities, and access to entry-level jobs. This enhances the transition from college to life after university.  Among the top 10 markets, the share of recent college graduates ranged from 2.5% to 4.4%. Notably, Pittsburgh, Pa. (4.4%), has the highest share, followed by Atlanta, Ga. (4.2%) and Richmond, Va. (3.7%).

Short Commutes

For college graduates who may be accustomed to walking to campus, the transition to work life after college may come with longer commutes, however it doesn’t always mean sitting in hours of traffic. The top markets on the Realtor.com^® list have an average expected commute time of 25 minutes in 2024, which is shorter than the city/town average of 30 minutes.  Notably, Overland Park, Kan., boasts the shortest average commute time of 22 minutes. Bloomington, Minn. and Scottsdale, Ariz. were not far behind; both have an average commute time of 23 min.

Appealing Lifestyle

Classes are out for good, so why not enjoy the fruits of college labor? Realtor.com^® measured how lively a town is using point of interest data provided by Yelp to indicate an abundance of entertainment, shopping, and lifestyle businesses. These businesses encompass a variety of venues such as restaurants, cafes, bars, shops, theaters, comedy clubs, and art studios. Among the top 10 markets, the number of businesses per 1000 households ranged between 17.1 and 39.5. Specifically, Beaverton, Ore., claimed the highest position within the top 10 list, with a ratio of 39.5. Atlanta, Ga., with a ratio of 27.5, and Scottsdale, Ariz., with a ratio of 25.2 were closely behind.

For more information on the Realtor.com^® Report on Top Rental Market for Recent College Grads please visit realtor.com/research.

Data Source and Methodology

For the purpose of the research, we ranked 313 cities and towns with a population of more than 75,000 that are located within the 50 largest metro areas. Rent-to-income ratio: Rental data are studio, 1-bedroom, or 2-bedroom units advertised as for-rent on Realtor.com® between April 2023 and March 2024 in the top 50 metros. Rental units include apartments as well as private rentals (condos, townhomes, single-family homes). Household income was sourced from 2024 Claritas estimates based on Census Bureau data. Rental vacancy rates were the 2023 average vacancy rates calculated from Census’s Housing Vacancies and Homeownership Survey for each city/place’s surrounding metro area. Recent college graduates-friendly occupations were those defined by the Bureau of Labor Statistics, requiring a bachelor’s degree but no prior experience. The share of these occupations were then calculated using 2022 ACS 1-Year individual data for each city/place’s surrounding metro area. The stated forecasted unemployment rates are Moody’s Analytics projections of U.S. Bureau of Labor Statistics Local Area Unemployment Statistics for each city/place’s surrounding metro area. The metro level online job posting index was sourced from Indeed’s Hiring Lab and we took the average index between April 2023 and March 2024  The share of recent college graduates was estimated using 2022 ACS 1-Year individual data. Recent college graduates were individuals who were between 25 and 29 years old, earned a bachelor degree and were not in school. The average commute time data was sourced from 2024 Claritas estimates based on Census Bureau data. Counts of culture and lifestyle businesses were aggregated from Yelp’s November 2023 point of interest data and are aggregated at the city/place level. The counts were then normalized using 2023 Claritas city/place level household data.

About Realtor.com^®

Realtor.com^® is an open real estate marketplace built for everyone. Realtor.com^® pioneered the world of digital real estate more than 25 years ago. Today, through its website and mobile apps, Realtor.com^® is a trusted guide for consumers, empowering more people to find their way home by breaking down barriers, helping them make the right connections, and creating confidence through expert insights and guidance. For professionals, Realtor.com^® is a trusted partner for business growth, offering consumer connections and branding solutions that help them succeed in today’s on-demand world. Realtor.com^® is operated by News Corp [Nasdaq: NWS, NWSA] [ASX: NWS, NWSLV] subsidiary Move, Inc. For more information, visit Realtor.com^®.

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