In 2020, Millennials lead the pack of first-time homebuyers- but poised to make an impact soon is Generation Z.
Born approximately between the years of 1996 and 2010, there are already 310,000 Gen Z’ers with mortgages. So could this demographic dethrone Millennials as the highest percentage of first-time homebuyers? Research suggests it could happen, and sooner than you think.
What Gen Z Thinks About Homeownership
Freddie Mac recently conducted a study which showed that 86% of Gen Z’ers want to own a home someday. They also found that 89% believe they will reach that goal. When asked what age they would like to own a home by, Gen Z’ers on average responded that they would like to do so by age 30.
The Generation Z respondents were more likely than Millennials to consider a home a source of pride, financial security, and freedom from rent.
Is It Really Possible?
Will Gen Z’ers really meet these goals of homeownership? If you consider their circumstances, it’s entirely possible. This generation typically isn’t old enough to have experienced the real impacts of the great recession, and those who have entered the workforce so far have done it during a period of economic prosperity (up until COVID, of course).
This, along with the fact that Gen Z’ers on average have better financial habits and education than their predecessors, put them in a great position to become homeowners in the near future.
One item to note in the Freddie Mac study is that Gen Z’s rosy depiction of homeownership was augmented by the younger members of the generation. Of course, this cohort, only in their mid-to-late teens, hasn’t yet been faced with the real-world complications of student debt or renting vs. buying.
Regardless, 9 million homes occupied by older generations are projected to be up for grabs by 2027, so if anything is conclusive, it’s that Gen Z’ers shouldn’t have a problem with inventory.