Gen Z has taken the lead in the homeownership race.
In 2023, the homeownership rate for adult Gen Zers, or those between 19 and 26 years old, was higher than the homeownership rate for millennials and Gen X when they were 24, according to Redfin, a real estate company.
The race is close, though. About 27.8% of 24-year-old Gen Zers are homeowners compared to 24.5% of millennials when they were the same age. Gen X had a lower rate at 23.5%, Redfin reports.
“I’m so happy with buying a home,” said 24-year-old homeowner Dominic Verrichia, who bought his home in Ventnor City, New Jersey, in October 2020, when the 30-year fixed mortgage rate was 2.83%, according to Freddie Mac.
“I didn’t know if I was making the right call [buying a home],” said Verrichia. “I didn’t know if it was going to turn me upside down.”
Gen Z makes up only 3% of homebuyers, the National Association of Realtors reported. This generation is entering homeownership with the lowest income and is unlikely to be married or have children under 18 in their household.
In 2023, almost three-quarters of Gen Zers said they plan to buy a home within six years, even though the market is tough for buyers, according to Rocket Mortgage, a mortgage lender company.
“It is an incredibly difficult housing market right now,” said Jessica Lautz, a chief economist at the NAR. “We have very limited housing inventory, and have had very limited housing inventory for a long period of time. It has pushed up home prices at the same time that interest rates are at a higher point than they have been in the last few years, which is making the real estate market really unaffordable.”
So how can Gen Z afford homes sooner than their elders could? What implications will that have for the housing market and the U.S. economy?
Watch the video above to learn how Gen Z is winning the homeownership race and how they compare to past generations when they were the same age.
