The pandemic has driven gen-Z and millennials back home to live with parents or relatives— a trend that will negatively impact apartment demand, according to a new report from Marcus & Millichap.

Unemployment has been the biggest driver of young adults moving home, but college closures have also had an impact. In April and May, there was an increase in young adults age 18 to 34 moving home, and by June, 27.7 million young adults had moved home, according to Marcus & Millichap. The good news is that June was the peak; the bad news is that the number hasn't declined much. In September, there were still 25 million young adults living at home. This is well above the prior four-year average, and it will likely continue to be a trend as long as unemployment remains high. In October, unemployment claims have continued to grow, supporting an outlook for young adults removing themselves from the apartment market.

College closures have added an interesting element to this dynamic. The future of in-person learning is uncertain and so far has been volatile, with schools opening for in-person education and then rolling back when outbreaks happen. Plus, the surge in cases could derail re-opening plans for spring. Distance education has impacted student housing and apartments in or near college towns, and the return to those markets is largely unknown.