So, here comes a study that reveals the natural order of things: In terms of homeownership, younger people can’t afford what the more established older generation has done.
Compounding it all are historically low inventory and skyrocketing prices. Younger generations seem to be facing two strikes before they can get the bats off their shoulders to take a swing.
It’s become a beat-down and old news for the younger generation.
This week, Apartment List released a report titled Generational Attitudes on Homeownership that finds Generation Z (those born between 1997 and 2012) are about half as likely as Baby Boomers (1946-1964) to say that homeownership is extremely important to their personal success.
In the report, Apartment List asked: On a scale of 1-10, how important is ownership for your own personal success?
Overall, nearly two in three respondents rated homeownership at an eight or higher while one in 10 gave it a rating of three or less. Across all generations, the share of respondents who view homeownership as “important” significantly outweighs those who consider it important. Apartment List’s report was collected Dec. 16-17 from a survey of approximately 5,000 workers.
Across Apartment List’s full sample, only 14 percent of respondents believe that it will be easier to purchase a home 10 years from now, while 67 percent believe that homebuying will be more difficult in a decade.
According to the Census Bureau, 47.9 percent of Millennials owned homes in 2020. Gen X had an ownership rate of 69 percent, Baby Boomers 77.8 percent, and the Silent Generation 77.8 percent.
Other studies are less pessimistic. For example, an MReport study showed that Gen Z’s numbers remained optimistic when polled about how attainable homeownership was within the next 10 years with 77 percent reporting that they thought buying a home was a probability for them compared to 83 percent of older Millennials and 79 percent of younger Millennials. At any rate, it’s not like Gen Z is finding a place to live: A RENTCafé study has found that Gen Z is responsible for a 21 percent increase in rental activity, mostly in large urban hubs.
As mentioned, the Apartment List’s findings of personal success reveal a natural order: Gen Z watched their parents deal with the Great Recession between 2007-2009. Millennials (1981-96) have their own financial issues with college loans and the current housing crunch, but they are in their prime homebuying years.
Equity-rich Baby Boomers, who were raised during the rapid rise of suburbs after World War II, had the advantage of ample housing supply and readily available financing.
“Baby Boomers came of age at the same time that homeownership was becoming synonymous with the American Dream, and this is still reflected in their present-day views,” according to Apartment List.
Other questions posed in the report:
- On a scale of 1-10, how difficult is it for the average American family to afford and purchase a home? Millennials proved to be the most pessimistic with 31 percent answering with a difficulty rating of 10.
- Do you believe homeownership will become easier or more difficult to achieve in 10 years? Gen X (1965-80) wasn’t as confident with 31 percent saying it would be more difficult. Millennials and Gen Z were more optimistic than the other generations with 14 percent rating homeownership to somewhat easier in the next decade.
Report review: Apartment List’s report is represented with only three charts, but it will capture your attention — a definite visual rabbit hole. 🐇
