How Gen Z is Winning the Real Estate Game, Millennials Struggle to Catch Up, and the Effects of FOMO
Hey there, real estate fanatics! Gather ’round, because we have some juicy news to share about our younger generations – specifically, Gen Z and Millennials – and how they’re faring in the homeownership arena.
Believe it or not, our youngest generation, Gen Z, is actually surpassing their parents (you know, those Gen Xers) in the homeownership race. According to recent stats by Redfin News, 30% of 25-year-olds owned their own home in 2022. That’s up from the 27% rate for Gen Xers when they were the same ripe age of 25! You go, Gen Z! But, alas, those who snoozed on pandemic-era low mortgage rates might be feeling the FOMO.
On the other hand, Millennials aren’t doing as well when it comes to owning homes, tracking behind their parents (those Baby Boomers we all know and love) with only 62% of 40-year-olds owning their home in 2022, compared to the 69% rate for baby boomers at the same age.
But don’t count Millennials out just yet! This generation still holds the crown for buying the most homes, with 25-44-year-olds snagging around 60% of homes sold over the last few years. Those “mortgage millennials” definitely have an edge over their peers who missed out on buying before rates went up.
Interestingly, Gen Z homebuyers are flocking to more affordable locations like Virginia Beach, where they bought 9% of homes sold in 2022. Meanwhile, Millennial buyers are all about job centers, like Seattle, where they snatched up more than 40% of homes sold.
So, what does this all mean? Well, some Gen Zers were savvy enough to take advantage of those record-low mortgage rates in 2020 and 2021, putting them on a better homeownership trajectory than their parents. But for those who didn’t act in time, the struggle is real, especially now that housing costs are skyrocketing, interest rates are higher, and the economy is showing signs of a possible slowdown.
Now, for those who think waiting for a housing market crash is the key, think again! Current data suggests that home prices have bottomed out and are on the rise again. So, don’t hold your breath for a price drop. And just wait and see what happens when interest rates come back down. It’ll be another buyer frenzy!
The moral of the story? If you’re waiting to buy a home until prices come down, you might want to rethink your strategy. Your best bet is to team up with a local real estate pro who can give you the latest insights and advice for your area. Happy house hunting!