Gen Z Is Stacking Cash—So Why Aren’t They Buying Homes?

There are 68 million Gen Zers in America, and nearly half of them aspire to own a home by 2029. Unlike previous generations, Gen Z has been exceptionally disciplined in saving money, with many still living with family to cut costs. But despite their strong savings habits, homeownership remains elusive for most. Why? Let’s break it down.

Gen Z Is Leading the Savings Game

According to Talker Research, Gen Z is consistently setting aside more of their income than older generations:

• 21% save between 1% and 10% of their monthly earnings.
• 25% save between 11% and 20%.
• 12% save around 21% to 30%.
• 5% are saving their entire paycheck.

In comparison, 26% of millennials don’t save anything, and 32% of baby boomers admit they save nothing. Yet despite this financial discipline, Gen Z still makes up only 3% of homebuyers today.

Why Isn’t Gen Z Buying Homes?

Even with solid savings, Gen Z faces major financial hurdles when it comes to homeownership.

1. Lower Incomes

The average annual income for Gen Z is $45,000, far below the median home price of $400,500. Many Gen Zers are in entry-level positions, making it harder to qualify for mortgages or save substantial down payments.

2. High Homeownership Costs

Gen Z buyers are stretching their budgets more than any other generation. In the 200 largest metro areas, they’re spending 37% of their income on mortgages, compared to the average buyer, who spends just 26%.

3. Rising Interest Rates & Housing Prices

Mortgage rates have been hovering around 6.95%, making monthly payments on a median-priced home approximately $2,413—which is $718 more than the national median rent. With home prices still rising and wages struggling to keep up, many young buyers are choosing to rent instead.

Where & How Gen Z Is Buying Homes

Despite the challenges, some Gen Zers are getting creative to achieve homeownership.

Affordable Markets

Rather than competing in high-cost coastal cities, Gen Zers are migrating to more affordable Midwestern regions like Akron, OH, where home prices are lower, and starter homes are within reach.

Co-Buying & House Hacking

With rising costs, Gen Z is teaming up to buy homes with friends, family members, or even co-workers. About 45% of Gen Z mortgage applications include co-applicants, proving that shared homeownership is becoming a viable solution.

Exploring Alternative Loans

Contrary to the belief that a 20% down payment is required, many Gen Z buyers are putting down as little as 5% to 10% with first-time homebuyer programs.

Will Gen Z Be Stuck Renting Forever?

Gen Z is the only generation currently adding more renters rather than buyers. A recent poll revealed that 13% of Gen Zers believe they will never afford a home—but that doesn’t mean they’re giving up.

With creative strategies like co-buying, house hacking, and relocating to more affordable cities, Gen Z is proving that homeownership is still possible—even if it looks different than it did for previous generations.

Bottom Line

If you’re a Gen Zer looking to break into the real estate market, Orange County offer unique opportunities—whether you're looking to buy your first home, invest with friends, or explore innovative financing options. Let’s talk about how you can make homeownership a reality in today’s market. Reach out, and let’s strategize your next move!

Reference: Taylor, J. (2025, February 4). Gen Zers have more money saved than millennials—but do they have the dough for a down payment? Realtor.com.