Of millennials who do hope to buy, almost half say it won’t be soon because home prices are too high – the No. 1 obstacle toward homeownership.
SEATTLE – A survey found that nearly one of every five (18%) millennials and 12% of Gen Zers said they’ll will never own a home.
They cited lack of affordability is the top barrier to homeownership for young Americans in the survey conducted by Qualtrics for Redfin. About half of Gen Z and millennial renters still in the market don’t think it likely that they’ll buy a home in the near future. They said prices are too high, and it’s blocking them out of the market.
While “home prices too high” is the top reason, many follow-up reasons also relate to finances:
- Nearly half (46%) of millennials and 33% of Gen Zers say they can’t save enough for a down payment
- About a third of Gen Zers and millennials say mortgage rates are too high
- Roughly one-third say they’re unable to afford monthly mortgage payments
- About one in five (21%) Gen Zers and 16% of millennials say they need to pay off their student loan debt before they’re able to buy a home
The May-June survey was fielded to 5,079 U.S. residents who either moved in the last year, plan to move in the next year, or rent their home.
“The worsening housing affordability crisis has an outsized impact on Gen Zers and millennials because they’re much less likely to own a home than older generations,” says Redfin Chief Economist Daryl Fairweather. “That means many young Americans don’t benefit from rising home prices by gaining equity. Instead, these would-be first-time homebuyers bear the burden of high prices, high down payments and high monthly mortgage payments, without profits from a previous home to offset the cost.”
- 26% of Gen Z adults and 52% of millennials own their home, compared to 71% of Gen Xers and 79% of baby boomers.
- Roughly 40% of Gen Zers and millennials are working second jobs to save for their down payment, and about one-quarter plan to use a cash gift from family.
- Of the young Americans planning to buy a home in the next year, many are turning to side hustles for their down payment. About 41% Gen Zers and 36% of millennials say they’ll work a second job to help fund their down payment – the most commonly cited method aside from saving directly from paychecks.
- 28% of Gen Z and 23% of millennials expect to receive a cash gift from family for their down payment, while 20% of Gen Zers and 15% of millennials plan to use an inheritance.
- Just over 20% of both Gen Zers and millennials plan to sell stock, and roughly 15% of both generations plan to sell cryptocurrency.
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