Economic uncertainty and the shifting housing market have created more challenging conditions for prospective home buyers and caused many to delay their housing searches. To understand the generational differences between the approach of owning a home and hurdles to homeownership, Truehold conducted a survey of 2,500 American homeowners.
According to the survey, baby boomers and Gen Zers often have entered the housing market to improve living conditions, while millennials and Gen Xers are seeking homeownership for improved stability compared with renting. Baby boomers and Gen Zers cited affordability as the biggest hurdle to homeownership, while millennials cited high interest rates. Gen Xers reported producing funds for a down payment as the biggest hurdle.
Despite the uncertainty and challenges to attaining homeownership, 70% of respondents to the Truhold survey indicated they would buy the same house again if they were to restart their housing search. Millennials and Gen Z buyers reported having the most confidence with their recent home purchases.
While respondents expressed confidence in their own purchase decisions, the majority indicated they would exercise more hesitation when advising non-homeowners about entering the current housing market. More than seven in 10 respondents said they would advise prospective buyers to avoid their first home purchase in the current market.
Gen X, millennial, and Gen Z respondents said owning a home is the top sign of financial success, while baby boomer respondents indicated the ability to retire was a more important sign of success than homeownership. However, high interest rates and persistent inflation have caused many younger homeowners to feel “house-rich” and “cash-poor” due to having the majority of their money tied up in their house, according to Truehold. Half of millennial respondents indicated they felt “house-rich, cash-poor” compared with just 21% of baby boomer respondents.
Additionally, 56% of millennials and 53% of Gen Zers said they are having a difficult time managing housing payments due to high inflation and rising consumer costs. More than 60% of millennials believe they will have to postpone or delay retirement because of the money allocated to their house. Respondents from older generations were much less likely to report having difficulties with housing payments or concerns about retirement, according to Truehold.
The Truehold survey generated an equal number of responses from the four generational cohorts. For the purpose of the survey, Gen Z was defined as individuals between the ages of 18 and 26, millennials were defined as between 27 and 42, Gen X was defined as between 43 and 58, and baby boomers were defined as individuals between the ages of 59 and 77.
