Millennials are quitting the homebuying hunt as Gen Z steps up
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Illustration: Shoshana Gordon/Axios
One in six aspiring buyers has abandoned their dreams of homeownership in the past six years because they couldn't afford a house that they liked, according to a new Bankrate survey.
Why it matters: Homeownership is typically seen as a pillar of the American Dream, but the punishing combination of rising home prices, high mortgage rates and a looming housing shortage has kept purchasing out of reach for many.
By the numbers: Only 7% of aspiring homeowners are actively attending open houses or searching for homes in their area.
- Gen Z is most likely to be on the prowl for a home, with roughly 9% doing so.
- Seven percent of millennials and Gen Xers are shopping around, and only 5% of baby boomers are still looking.
Zoom in: Millennials are the most likely generation to have given up on their dreams of purchasing a home at 22%, while only 12% of Gen Z, the youngest searchers, have abandoned the hunt.
- The survey reflects a long-running trend of younger generations feeling like they're being priced out of financial opportunities when compared to older generations.
- 54% of Gen Z surveyed by Bankrate said that older Americans have had sunnier prospects in home buying.
Zoom out: While homeownership is still a top goal for many Americans, buyers now have to make over $50,000 more per year than renters to afford their housing payments, as Axios' Sami Sparber previously reported.
- A mid-priced home requires an annual income of roughly $116,600, while renters need just $64,200 for a mid-priced apartment.
- The typical household earns approximately $86,400, keeping homeownership firmly out of reach.
The bottom line: Homeownership isn't the only component of the American Dream that's starting to feel unattainable for younger adults.
- According to a new report, the dream now costs more than $5 million, with the cost of milestones like homeownership, retirement, raising two kids and obtaining quality healthcare increasing every year.
Go deeper: The American Dream's closing gate
