KEY TAKEAWAYS
- Housing prices and mortgage rates remain high, putting homeownership out of reach for many Gen Zers.
- Affording a down payment is one of the biggest hurdles to homeownership for this generation, since many must first pay rising rent prices and their student loan debt.
- Some Gen Zers are finding ways to enter the housing market, getting financial help from their families and buying homes in cheaper areas in the Midwest and South.
Housing prices continue to rise, and other expenses are cutting into Gen Zers’ budgets, making it extremely hard for them to buy a home. But some have managed to do it, shopping in cheaper markets and getting help from family.
Mortgage rates have been elevated for years, and that’s led to a stagnant market with low housing supply and high prices. In 2024, a little more than a quarter of Gen Zers were homeowners, according to a report by Redfin. That number has remained relatively flat since 2022.
Why This Is Significant
Buying a home is the heart of the American Dream, and the fact that it’s out of reach for the bulk of an entire generation signals deeper structural issues with the U.S. economy. Homeownership is normally how Americans build wealth, so this hurts upward mobility.
Renting and Student Debt Make It Harder to Save
The biggest hurdle for many Gen Zers is saving enough money for a down payment.
The majority of Gen Z are unable to put 20% down on a typical-priced home. The median asking price for a home in the second quarter of 2025 was $346,700, according to the Census Bureau, which means a 20% standard down payment would be $69,340. Yet, only 4% of Gen Z renters said they have more than 50,000 saved, according to a survey by Insurify.
Even if they buy a cheaper starter home at $200,000 and put down the median down payment for a first-time homebuyer of just 9%, that would still require $18,000. And only around four in ten Gen Z renters have enough savings to make this down payment.
For many Gen Zers, the high cost of rent makes it particularly hard to save. The national median rent price in the second quarter of 2025 was $1,494, according to the Census Bureau. In 53 major U.S. cities, renters have to use more than the recommended threshold of 30% of their income to make rent payments, according to Zillow.
In addition, Gen Z has had to restart student loan payments after a hiatus during the COVID-19 pandemic. And if they don’t keep up their credit might be dinged, or worse, the government could garnish their wages. Many borrowers have had to cut their spending to afford their student debt, and 40% of Gen Zers surveyed by Insurify said their student loans make it harder to buy a home.
How Gen Zers Are Affording Homes
While the real estate market has been difficult for Gen Zers, some have found creative ways to achieve homeownership.
Many Gen Z homeowners have found success in more affordable markets in the Midwest and South, where the median home prices are cheaper than the national average, according to Cotality, a financial service company previously known as CoreLogic.
Three in 10 Gen Z homeowners said that this year they were able to afford a down payment using money earned from a second job, a number that has been rising in the past few years, according to a report from Bank of America.
Some rely on help from their family. One in five Gen Z and Millennials said they had financial assistance from their family to pay for a down payment, according to Redfin. In addition, more than 18% said they have been living with family or friends to save money to purchase a home.
