Homeownership in America: A Generational Divide

2,500 American homeowners of all ages — Baby Boomers, Gen X, Millennials, and Gen Z — share their feelings on the wavering importance of homeownership in 2023, struggles caused by economic uncertainty, regrets about buying their homes, home affordability in tough market conditions, and much more.

NEWS
JUNE 21, 2023
Homeownership Statistics Report

Truehold surveyed a total of 2,500 American homeowners with varying financial and lifestyle goals to better understand what home ownership really means to individuals in different phases of life.

With equal representation from each generation, our results uncovered compelling similarities and differences between what your age is and how you approach owning a home. We uncovered insights such as unwavering positivity among certain age groups and troubling concerns within others. We also found significant homeownership trends and shifts compared to just a few years prior.

The report below reveals levels of excitement about homeownership, strong feelings about the state of the US economy, trending motivations for purchasing a home, anxiety about home affordability, advice for future homeowners, and many other eye-opening opinions from current homeowners.

Before we get into the data recap, let’s take a look at the age groups from which the data was gathered. As of the collection date, our respondents were:

  • Generation Z: 18-26 years old
  • Millennials: 27-42 years old
  • Generation X: 43-58 years old
  • Baby Boomers: 59-77 years old

Summary of Key Homeownership Statistics & Findings

  • 55% of Boomers, 51% of Gen Xers, 71% of Millennials, and 73% of Gen Zers feel positive about owning a home in the current market.
  • 70% of all Americans have no regrets about their home purchase and would repeat the process without change.
  • 65% of Boomers, 75% of Gen Xers, 80% of Millennials, and 66% of Gen Zers would consider advising against making a home purchase during the current market conditions.
  • 69% of all Americans agree or are on the fence about the fact that homeownership may no longer be part of the American Dream.
  • 50% of Millennials say they are house rich and cash poor due to their most recent home purchase — the highest of all generations.
  • 56% of Millennials and 53% of Gen Zers say they cannot or are struggling to afford their home due to inflation and rising costs and are looking to cash out equity. Only 24% of Boomers and 38% of Gen Xers feel the same way.
  • Millennials and Gen Zers both plan to tap into their home equity within the next 6-12 months.
  • 88% of Millennials, 80% of Gen Zers, and 77% of Gen Xers say they believe or are fearful of a potential recession that would force them to pull money out of their house. Only 56% of Boomers feel the same way.
  • 61% of Millennials believe or are on the fence that they will have to postpone or delay retirement because all of their money is tied up in their house.

Americans' View on Homeownership in 2023

The past few years have been difficult for many Americans. From the COVID-19 pandemic to ongoing economic volatility, macro issues have had major impacts on individual Americans’ finances.

Recent economic uncertainty and recession worries have also had a significant impact on the US housing market. The fear of an economic downturn has led to a decrease in consumer confidence and a more cautious approach towards major financial decisions such as purchasing a home.

The result: fewer buyers are willing to enter the market. The economic uncertainty and recession concerns have created a more challenging and unpredictable environment for both home buyers and sellers.

With the current economic conditions in mind, we set out to uncover the real truths about American homeownership sentiment by going straight to homeowners themselves and gathering their personal opinions.

To start, we wanted to find out why consumers purchased a home and what made that process most difficult. We found that the biggest motivations to purchase a home were split between the generations. Boomers and Gen Z said they wanted better living conditions, while Millennials and Gen X said they were looking for the housing stability not offered by rental units.

When asked about to share their biggest hurdle during the home buying process, here’s what each generation had to say:

  • Boomers: Home affordability
  • Gen X: Saving for a down payment
  • Millennials: High interest rates
  • Gen Z: Home affordability

Buying a home clearly comes with challenges; however, for many Americans this impactful experience can leave them with an incredibly strong and personal connection to their home.  With that in mind, we wanted to find out whether that personal connection to a home outweighed any regret from the purchase. When asked if owners would buy the same house again with no regrets, 70% said they absolutely would, with Millennials, 78%, and Gen Z, 75%, feeling most confident about their home purchase.

Lastly, to understand general homeownership and what it means to Americans, we asked respondents how homeownership ranked as a measurement of life-long economic success. It turns out that owning a home is, in fact, a hugely important sign of success for many. To start, Boomers shared that the ability to retire ranked first on their list, even more so than owning  a home. Perhaps their life experiences have moved them in this direction, while younger generations — Gen X, Millennials, and Gen Z — ranked owning a home as the top sign for financial success.

Could it be that our wise, elder generation know something younger generations don’t and that  retirement might outweigh the American Dream of homeownership? It remains to be seen if the younger generations are actually lagging behind in this thought process and will agree over time.

Now that we have a better understanding of what homeownership means to our respondents, let’s dive into more details about the current state of the residential real estate market in America.

Troubling Housing Market Conditions

Over the past three years, the US housing market has experienced a series of dynamic shifts. From 2021 to 2023, the housing market has been characterized by a combination of robust demand, dwindling inventory, and soaring prices. Just a few years ago, low mortgage rates, coupled with the desire for larger living spaces and favorable work-from-home conditions, fueled a surge in homebuyer activity. However, this increased demand has been met with limited housing supply, leading to intense competition among buyers and a seller's market in many regions.

The resulting imbalance between supply and demand has driven home prices to unprecedented levels, raising concerns about affordability and accessibility for homeowners. With these issues in mind, we set out to better understand how current homeowners feel about the market and the aforementioned conditions.  

To begin, we asked respondents to share how they felt about being an owner in this up-and-down market. While many are fearful during these uncertain economic times, 63% of American homeowners said they feel positive, or even very positive, about owning a home right now with Millennials, 71%,  and Gen Z, 73%, feeling the best. The younger generations likely feel the most secure as time is definitely on their side when compared to Boomers and Gen X.

While homeowners are confident about their own decision, they were more hesitant when it came to advising non-homeowners in these housing market conditions.  When we asked if they would suggest that new homeowners avoid their first home purchase right now 72% agreed or were on the fence. The most concerned generations were Millennials, 80%, and Gen X, 75%.

Survey Info

American homeowners are torn. They love owning their homes, but they don’t think it’s a good time to advise others to buy.

For decades, however, owning a home was an essential part of the American dream. It conveys a number of economic benefits, such as the ability to accumulate wealth by building home equity and accessing credit, and by reducing housing costs through the mortgage interest deduction.

But does this dream still exist in our state of economic uncertainty and a volatile housing market?

We asked respondents if they agreed with the statement that homeownership is no longer part of the American Dream. And surprisingly, 69% said they do agree or are unsure about whether the American Dream still includes homeownership. It’s less shocking that Gen X, Millennials, and Gen Z all feel more strongly about this statement than Boomers. Specifically, here’s how the generations felt about the above statement:

  • Boomers: 59% agree or unsure
  • Gen X:  68% agree or unsure
  • Millennials: 78% agree or unsure
  • Gen Z: 72% agree or unsure

After discussing the housing market conditions, we set out to learn more about homeowners financial struggles amidst the recent economic downturn.

Economic-Driven Financial Struggles

Buying a house is a major achievement for Americans of all ages. But for many recent homeowners, the positive feeling after a home purchase is short-lived due to high interest rates, unaffordable prices, and rising inflation across the country.

To learn more about current homeowners financial standing, we asked if buying their house has made them “house-rich, cash-poor,” meaning all of their money is tied up in their house without much leftover.

When asked, 50% of all Millennials said they do indeed feel “house-rich, cash-poor” because of their purchase, and just 21% of Boomers, 35% of Gen X, and 34% of Gen Z echo that statement. Overall, a common theme continues throughout this report, as Millennials feel much worse about their current standing as a homeowner, with

Survey Info

Having a limited budget outside of housing costs can be extremely stressful. And with rising inflation and consumer costs, and a potential looming recession, having a budget with wiggle room can be important.

We asked respondents if they can no longer afford their home during these trying times and if they’re looking to get equity out for some extra cash. Overall, 43% of homeowners said they agree or are on the fence about not being able to afford their home, while Millennials, 56%, are having a difficult time with affordability than the other generations. A similar theme is on display again with younger generations struggling much more.

Survey Info

As we all know, hindsight is 20/20. If we could predict the future, most of us would be in a much better financial situation than we are currently. But when it comes to the American economy, you never know what can happen. 

With that in mind, we asked respondents if they would have purchased their current home if they knew troublesome economic times were on the horizon. Unsurprisingly, Boomers are the most confident of the generations.

Here’s a detailed look at what percentage of each generation would still have purchased their home even if they knew the economy would struggle as of late:

  • Boomers: 82%
  • Gen X: 67%
  • Millennials: 47%
  • Gen Z: 53%

With many Americans sharing that they’re struggling financially to afford their current homes, we wanted to learn more about the options they have to better their situation, specifically tapping into home equity.

Tapping into Home Equity

Homeowners have a handful of ways to access home equity — a sale-leaseback with Truehold, cash-out refinance, home equity loan, and a home equity line of credit (HELOC), among others. It's important to consider the pros and cons of each and identify ways to ensure the fastest HELOC closing or get funds quickly through another home equity option.

With many owners, specifically Millennials and Gen Z, telling us that they will need to tap into their home equity soon, we wanted to find out how much they know about the process.

When asked to rate their knowledge of the options they have to get cash out of their house, homeowners remained extremely confident with 88% of Boomers, 87% of Gen X, 92% of Millennials, and 90% of Gen Z saying their knowledge on this topic is average or better.

While it’s great news that homeowners feel confident in their ability to navigate tapping into their equity, the bad news is that the majority of them believe it will soon be necessary because of consumer inflation and a potential recession; 56% of Boomers, 77% of Gen X, 88% of Millennials, and 80% of Gen Z agree or are on the fence about these negative economic factors being the major driver of tapping into home equity.

Survey Info

So, how soon will this happen for the aforementioned concerned homeowners? When asked how soon they anticipate applying for a home equity line of credit in the near future, both Boomers and Gen X said they had no plans to do so; however, Millennials said they anticipate applying within 12 months and Gen Z said within 6 months — the younger generations are facing more economic trouble.

While living in the present and having cash on-hand is important, we all know that retirement saving and planning are also crucial to a stress-free life. Let’s take a look at how Americans of all ages feel about retirement as it relates to their current financial standing as a homeowner.

Retirement Planning & Staying Home

A key benefit of homeownership is that it can provide retirees with astable housing expense, as they are not subject to rising rents..Americans who do not wish to stay in their home, on the other hand,may use the home sale to fund their retirement. So how are Americans feeling about their home and retirement today, in 2023, with uncertainty within the housing market?

When homeowners were asked if they think the only way they’ll be able to retire is by selling their house, 48% said they agreed or were on the fence about this statement, while a remarkable 61% of Millennials shared that they were fearful about being able to retire without selling their home.

Survey Info

Similarly, 39% of Boomers, 50% of Gen X, 63% of Millennials, and 47% of Gen Z agree or are on the fence when asked if selling their home is a major part of their current retirement plan. Clearly, Americans believe that a home sale can, and will need to, fund their retirement when that time comes. 

Interestingly, while the home sale is a major piece of the retirement puzzle, 71% of Americans told us that they actually want to stay in their homes when they retire. Here’s a generational breakdown:

  • Boomers: 72%
  • Gen X: 63%
  • Millennials: 71%
  • Gen Z: 76%

Retirement is important to all Americans. And financially planning for retirement can be difficult in today’s economy as consumer costs rise and housing affordability becomes even more difficult. Many believe they will have to sell their home despite dreaming of living out retirement in the comfort of the home they know and love. 

To wrap up, we asked American homeowners what the biggest barrier to retirement will be in their lifetime. Not surprisingly, Americans from different generations have contrasting feelings on this topic, as Boomers said their biggest barrier is that they’d prefer not to sell their house, Gen X and Millennials said they don’t have enough money saved, and Gen Z said supporting family and friends is too big of a burden for them to retire. 

Overall, throughout this report, we’ve found that Americans of all ages suffer varying levels of financial stress, have issues with homeownership and envision vastly different plans for the future depending on their age. 

While the American economy has struggled for a few years and home prices have risen, Americans still see the true value in owning a home and staying in that home post-retirement. 

Getting to retirement is difficult  as homeowners navigate the aforementioned economic circumstances. But in the end, Truehold believes that the power of owning a home and using home equity to build wealth is something that means a lot to the majority of Americans and will continue to be important for years to come. 

For more information on Truehold’s research or to request graphics or quotes from this study, please contact press@truehold.com.

Methodology

All data found within this report is derived from a survey by Truehold conducted online via survey platform Pollfish. In total, 2,500 adult American homeowners were surveyed — an equal number from each generation. The respondents were found via Pollfish’s age filtering features and screened to ensure homeownership at the time of survey completion. All respondents were asked to answer all questions as truthfully as possible and to the best of their knowledge and abilities.

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