Gen Z, millennials face affordability hurdles as both renter and owner households grow evenly
Homeownership rates among young Americans are stalling, with new data showing that Gen Z and millennials made little to no gains in 2024, even as the number of both homeowner and renter households in the US continues to grow.
Just 26.1% of Gen Zers owned a home in 2024, virtually unchanged from 26.3% in 2023 and 26.2% in 2022, according to a recent report from Redfin.
That’s a notable slowdown, considering Gen Z had been gaining homeownership ground nearly every year since 2017, when the oldest cohort began reaching homebuying age.
Millennials are following a similar trend. Just under 55% (54.9%) of millennials owned homes in 2024, up only slightly from 54.8% the previous year, marking the second consecutive year of little to no growth. By contrast, millennial homeownership had steadily risen each year from 2012 until 2022.
Meanwhile, older generations saw modest increases. Homeownership among Gen Xers rose to 72.9%, up from 72% in 2023, and baby boomers reached 79.6%, up from 78.8%.
Many Gen Zers and millennials have reached what’s traditionally considered prime homebuying age, often marrying, starting families, and establishing careers. But steep housing costs and rising mortgage rates have stalled their path to ownership.
Monthly payments near all-time highs
Redfin notes that typical homebuyers in early 2024 were paying close to $2,800 per month, a new record high. Although wages have increased in recent years, they haven’t kept pace with soaring home prices and mortgage rates. After hovering near 3% in early 2022, average rates jumped to around 7% by the end of that year and have remained elevated since.
With low inventory keeping prices high, many younger buyers are simply priced out, particularly those who don’t already own a home and can’t tap equity to move up the ladder. Housing affordability remains the main barrier, but other factors also play a role: from student loan debt to lifestyle preferences, job uncertainty, and a post-pandemic shift toward flexibility and remote work.
“Homeownership is still a symbol of success and stability for many Americans, but the nation’s culture is shifting with the economic times,” Redfin chief economist Daryl Fairweather said in the report. “Some young people are placing less emphasis on owning their own home because they’re prioritizing flexibility, while others continue renting because they can’t afford to buy.”
Fairweather added that while buying a home remains a sound long-term investment, younger people who lack the means or desire might opt to put their money elsewhere.
“Those people might consider investing in the stock market, their own business, or education,” he said.
Renter, owner growth now neck-and-neck
Despite stagnant homeownership among younger adults, a separate Redfin analysis shows that the number of renter and homeowner households is now growing at the same pace—a shift after more than a year of renters outpacing owners.
In Q4 2024, the number of renter households grew 0.8% year-over-year to 45.4 million, while homeowner households also increased 0.8% to 86.9 million. It’s the first time since early 2023 that the two groups expanded at the same rate.
Read next: Rising housing costs anchor renters in place
That leveling-off may signal that the rental market’s earlier surge is stabilizing. Rent prices, while still about 20% above pre-pandemic levels, have cooled slightly as new rental supply entered the market. Meanwhile, home prices remain over 40% above pre-pandemic levels, continuing to pressure would-be buyers.
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