Younger Americans Shift From Homeownership to Other Wealth Paths

Younger Americans are buying homes at lower rates than earlier generations and are turning to other ways to build assets, according to recent surveys and market data. Rising home prices, limited starter-home inventory and higher mortgage rates are cited as the main constraints for first-time buyers.

A Pew Research Center survey found nine in 10 adults under 40 say it is harder for young people today to buy a home than it was for their parents. The same survey showed only one in four adults ages 18 to 39 view homebuying as a “very good investment,” compared with nearly 40% of adults 60 and older. An Ipsos poll in 2025 reported just 18% of 18- to 34-year-olds consider homeownership a good way to build wealth. Federal Reserve data indicates people 55 and older hold roughly three quarters of the nation’s wealth.

Sales data point to older buyers dominating transactions this year. The National Association of Realtors reports baby boomers made up 42% of homebuyers so far this year, while millennials accounted for 26% and Gen Z for 4%. Starter homes are scarce: many listings are larger single-family houses with three bedrooms and two baths, which often exceed first-time buyers’ budgets. “First-time homebuyers have really struggled in today’s housing market due to affordability and also incredibly tight inventory, especially for starter level homes,” Jessica Lautz, deputy chief economist at the NAR, said.

Market costs are affecting decisions. Redfin data show the median U.S. home price reached nearly $409,000 in June, up 2.2% year over year, while the 30-year mortgage rate was above 6.5% in July. The recent memory of much lower pandemic-era rates has led some current homeowners to remain in place rather than sell and take on higher borrowing costs. Chris Porter, senior vice president of research at John Burns Research and Consulting, observed that some housing supply that might have reached entry-level buyers is being held back because existing homeowners are unwilling to trade down to a higher rate.

Outside the housing market, younger adults face additional financial pressures. High rents, student-loan balances and childcare expenses make saving for down payments harder. Federal Reserve figures show nearly half of adults 18 to 29 live with a parent, and 47% of adults in that age range receive financial help from someone outside their household. An Intuit survey found 64% of Gen Z prioritize peace of mind over accumulating wealth.

The timing of home purchases affects long-term wealth accumulation. The NAR estimates a typical homeowner this year will have about $446,000 in net worth; Lautz estimated that buying a first home a decade later could mean missing roughly $150,000 in accumulated wealth gains over that period. Analysts say delayed buying may coincide with higher household income or dual earners, which can change later housing choices.

Many younger adults are shifting savings toward retirement accounts and financial markets. Financial planners report more clients in their 20s and 30s prioritize 401(k)s and IRAs. Some use creative real estate strategies: Gen Z financial planner Dinon Hughes bought a duplex, lives in one unit and rents the other to help cover costs. “Generations before us saw homebuying as the American dream,” Hughes said. Others favor investments in stocks, online brokerage accounts or cryptocurrencies as alternative asset-building methods.

Surveys and market measures show immediate homeownership is a smaller part of wealth-building for a growing share of younger adults, while delayed purchases and alternative investment strategies are more common.