Generation Z is ambitious about homeownership, and it shows through their savings habits. According to realtor.com, Gen Z-ers (ages 18 to 24) interested in homeownership are two times more likely than previous generations to be saving or plan to be saving for a home by age 25—and two of five Gen Z-ers are aiming to become homeowners by that age.
These insights are the result of a survey realtor.com conducted in conjunction with Harris Interactive, which included responses from 3,372 Americans across Generation X (ages 35-50), millennials/Generation Y (ages 25-34) and Generation Z, to better understand the generational differences in relation to homeownership and aspirations.
“Gen Z-ers don’t just want to become homeowners; they want to do it at a younger age and we found that they’re saving or planning to save for it accordingly,” said Danielle Hale, chief economist at realtor.com. “Their desire for homeownership may be similar to that of millennials and Gen X-ers, but graduating into one of the best labor markets in generations might give them the boost they need. Only time will tell if Gen Z-ers are able to achieve their ambitious goals.”
Generation Z’s homeownership fervor closely resembles that of millennials and Generation X, as 79 percent are certain they want to (or already do) own a home, compared to 82 percent for both Gen Y and Gen X. A larger share of Gen Z-ers are open-minded and may be interested in pursuing homeownership sometime in the future (17 percent), compared to millennials (13 percent) and
Gen X-ers (11 percent). Accordingly, Gen Z-ers who answered “yes” or “maybe” to desiring homeownership are more than twice as likely to have started or plan to start saving for a home before age 25 (74 percent), compared to what Gen Y (33 percent) and Gen X (33 percent) actually reported accomplishing.
Overall, only 4 percent of Gen Z-ers are sure that they don’t want to own a home, on par with the results for Gen Y (5 percent) and Gen X (6 percent). The expenses associated with homeownership are the biggest deterrent across all generations, especially for Gen Z-ers (48 percent vs. millennials at 31 percent and Gen X-ers at 42 percent). The second most-cited reason Generation Z didn’t want to be a homeowner was that they were not yet ready to settle down in one place (25 percent).
Customization is King, Especially for Generation Z
Generation Z are least likely to become or plan to become a homeowner for investment purposes (29 percent) or tax benefits (16 percent). Instead, they cite wanting to customize their space (61 percent) as the top reason for homeownership, and tied with millennials for wanting to raise their family in a home they owned (55 percent).
A Little Help From the Parents Isn’t Off the Table
Gen Z-ers are the most optimistic about getting financial assistance from their parents to reach their homeownership goals, with 56 percent saying “maybe” or “yes” to expecting or receiving financial help from family. Interestingly, Parents of Generation Z are the least likely to have received family assistance from relatives. Gen X-ers were least likely to expect or have received help from their family (59 percent no), and millennials are split down the middle (50 percent no, 50 percent yes/maybe). With a head start on savings and potentially greater access to family support, this up-and-coming generation could be better prepared to invest in real estate.
Need Help Educating Consumers?
ALTA’s Homeowner Outreach Program (HOP) has many resources to help you explain the benefits of title insurance to consumers, real estate agents and others. Items such as flyers, social media ads and blog content can be used to market your business. Check out the material at alta.org/hop.
In addition, you can register for the upcoming HOP Leader Training (Aug. 14 in Chicago) to learn how to
effectively use the resources. To view the schedule and register, go to meetings.alta.org/hop.
Source: ALTA Blog