Warm the milk in the microwave on the stove to around 105-115 F. Ensure that the temperature is below 140 F as yeast can be killed off at high temperatures.
Add the yeast to the warmed milk and let stand for 5-10 minutes until it begins to bubble.
In the bowl of a stand mixer using the dough hook attachment, or in a large bowl using a rubber spatula or your hands, knead together the flour, sugar, and yeast mixture. Continue kneading until well combined.
Add the vanilla, soft butter, egg, and salt and continue kneading for 5 minutes until the dough no longer sticks to the sides of the bowl.
Use your hands to shape the dough into a ball. Put the dough back in the bowl and place a clean kitchen towel over the top of the bowl. Set the bowl in a warm draft-free place and let the dough rise for an hour.
At the 45 minute mark, preheat oven to 350 F. Grease and line a 9 x 13 inch pan with parchment paper.
Remove the ball of dough to a well floured work surface and knead several times, then roll to fit inside the pan.
Put the dough in the pan, and let it rest for an additional 15 minutes.
Meanwhile, prepare the streusel by whisking together the flour and sugar in a small bowl. Use your finger tips to rub the butter into the flour mixture until crumbs begin to form.
Once the dough has rested, brush it with milk or cold water, then sprinkle the top of the dough with a generous layer of streusel. The liquid will help the streusel stick to the yeast dough.
Bake the cake on an oven rack in the center position of the oven for around 25-30 minutes until the crumble topping is golden brown.Remove the cake from the oven and let it cool on a wire rack.
Dust the cake with powdered sugar just before serving.