Many Millennials Determined To Enter the Housing Market, Study Says
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A solid majority of millennials still think home ownership is part of the American dream, but like everyone else, they are finding the current housing landscape challenging. Unlike Generation Z, though, they are more motivated and better situated to enter the market.
Some 1,000 millennials who said they wanted to buy a home in 2026 were surveyed by the cash-offer home selling platform Clever Offers last fall, and if the polling is accurate, we could see some market activity this year.
Two-thirds of those polled have already delayed their plans to buy a home because of market conditions. Of those, 56% have put off buying for at least three years, and 23% have delayed pulling the trigger for five years or more. There is some pent-up demand in this demographic.
Roughly 40% said they were desperate to buy a home, and 44% said they were willing to spend more than half their monthly income to make their mortgage payments. That’s about double what’s been understood to be advisable for housing expenses.
Now, it’s not so much that millennials want to get in over their heads — though apparently most appear unwilling to give up spending on things like gym memberships, alcohol, and subscription services to make things easier on themselves — but the average cost of a home has gotten so high over the years that big payments are coming to be expected.
The median sale price of a home is over $400,000, which puts a 20% down payment at roughly $80,000. You can still get a mortgage with a much lower down payment, but you’ll be borrowing more and paying more in the long run. Still, millennials appear undeterred, even with only 45% saying they’ve saved enough for a 10% down payment, according to the survey.
“Millennials have always faced a tough road to homeownership,” the Clever Offers report reads. “They entered adulthood weighed down by student debt and low starting salaries in the aftermath of the Great Recession. Then the pandemic hit, pushing home prices — and subsequently interest rates — to new highs. As if conditions weren’t bad enough, now millennials must contend with new tariffs driving up the cost of home construction and maintenance.”
Housing inventory has been a top concern of local, state, and federal officials in recent years, spurring a deregulatory push at all levels of government to boost production. Mortgage rates have also proven problematic. They are still more than double what they were five years ago. Not only is that more burdensome on prospective buyers today, but homeowners who financed or refinanced back then are more reluctant to give up their rates by making a move, resulting in fewer options for scouting for a home.
Generationally, you’ve also got baby boomers digging their heels in, with a growing number saying they intend to spend the rest of their lives in their current homes, as previously reported by CandysDirt.com. Less turnover, of course, means fewer options on the market.
Regardless, millennials may be poised to buoy housing activity if mortgage rates keep up their relatively steady decline. About 50% of those polled said they would consider taking out a mortgage if rates got below 6%. Well, we’re just about at that threshold. I guess we’ll see if they put their money where their mouth is.
Unlike Generation Z, which is pessimistic about its home ownership prospects, millennials are better positioned to make the financial commitment, even if it’s not the most responsible decision.
“At this point, even giving up avocado toast, cold brew, and beloved houseplants wouldn’t help them afford the massive expense of homeownership,” the Clever Offers report reads. If that’s really the case, and owning a home is so important to them, why not just go for it? If you can qualify, that is.
