Gen Z individuals are set to become a more important part of the housing market equation. Approximately 69.5 million people, or 21% of the U.S. population, born between 1997 and 2012 make up the Gen Z demographic, and just 17% of Gen Z individuals own a home.
Point2Homes analyzed the country’s 100 major cities to assess the feasibility of Gen Z homeownership, finding that cities in the Midwest and the South are the best locations for Gen Z home buyers. When ranked by a composite score of home price-to-income ratio, median sale price difference compared with the prior year, inventory per 10,000 residents, share of homes sold above listing price, days on market, Gen Z homeownership rate, and Gen Z unemployment rate, Fort Wayne, Indiana, ranked as the most accessible market for Gen Z individuals.
Fort Wayne ranked favorably for a low home price-to-income ratio and a low Gen Z unemployment rate. The city also boasts a Gen Z homeownership rate of 13.9%. Other favorable cities for Gen Z buyers include Corpus Christi, Texas; Detroit; Laredo, Texas; and Memphis, Tennessee.
Three cities in Texas—Corpus Christi, Laredo, and Fort Worth—rank favorably for accessibility due to home prices below $350,000 and a small percentage of homes sold above asking price. According to Point2Homes analysis, no homes were sold in Laredo above asking price despite the city’s tight inventory.
Among the most difficult cities for Gen Z individuals to become homeowners, it is no surprise that California is home to seven of the 10 least accessible markets. Fremont (No. 1), San Diego (No. 2), San Jose (No. 4), Riverside (No. 5), Los Angeles (No. 6), Sacramento (No. 7), and Chula Vista (No. 8) are among the most difficult markets for Gen Z buyers. In Fremont, average home prices are almost 23 times the average young person’s household income.
Point2Homes found New York City and its boroughs as another inaccessible area for Gen Z buyers in large part due to prices near or above $1 million and tight inventory across the city.
Other difficult markets for Gen Z buyers include Lexington, Kentucky; Richmond, Virginia; and Newark, New Jersey. Lexington ranks as the third most difficult market due to scarce inventory, a high unemployment rate among the Gen Z demographic, and a low median household income ($25,150).
