Apartment List's 2023 Millennial Homeownership Report
According to the latest data from the Census Bureau, millennials have finally reached a significant milestone: more than half own their homes. For a generation whose identity has been shaped by a tumultuous relationship with the housing market, homeownership has been a lofty goal, growing exceedingly expensive and competitive compared to when their parents were coming of age. But today the median millennial is a homeowner, with the latest millennial homeownership rate standing at 51.5 percent.
Older generations, unsurprisingly, have higher homeownership rates today. While millennials crossed the 50-percent threshold in 2022, generation X is on the cusp of reaching 70 percent. 77 percent of the silent generation owns their homes, but their homeownership rate is slowly declining as they age into their 80s and 90s and some members move in with younger relatives or into assisted living facilities. Baby boomers, born into the suburbs that emerged rapidly after World War II, maintain the nation’s highest homeownership rate today at 78 percent.
A more apples-to-apples comparison of the generational divides in homeownership can be made by controlling for age. The chart below shows that at each stage of life, the last three generations have bought homes slower than the generation that preceded them. Millennials have had the slowest transition from renters to homeowners. By age 30, 42 percent of millennials owned their homes, compared to 48 percent of gen Xers, 51 percent of baby boomers, and nearly 60 percent of silents. That gap persists through their 30s and into their early 40s.
A handful of economic and cultural factors explain these generational gaps. The most significant was the Great Recession, which suppressed homeownership across all generations but was particularly damaging to millennials, whose early career trajectories were shaped by a historically unstable economy. During the economic recovery that followed, many millennials were drawn to centrally-located jobs in cities where starter homes became increasingly scarce and expensive. While many millennials purchased homes during these years, others spent more time living at home or in rentals, delaying major life events like homeownership, marriage, and childbearing when compared to earlier generations.
In 2020, the COVID-19 pandemic drove an even deeper wedge between millennial homeowners and millennial renters. On one hand, millennials purchased an outsized share of homes during the first two years of the pandemic, when mortgage rates fell below 3 percent. On the other hand, housing inventory dropped to all-time lows and for-sale prices skyrocketed more than 40 percent. For millennial renters who could not afford to buy a home in the earliest stages of the pandemic, homeownership opportunities waned dramatically in the years that followed. Mortgage rates spiked, bringing modest relief to list prices but pushing monthly ownership costs even higher.
Older generations, unsurprisingly, have higher homeownership rates today. While millennials crossed the 50-percent threshold in 2022, generation X is on the cusp of reaching 70 percent. 77 percent of the silent generation owns their homes, but their homeownership rate is slowly declining as they age into their 80s and 90s and some members move in with younger relatives or into assisted living facilities. Baby boomers, born into the suburbs that emerged rapidly after World War II, maintain the nation’s highest homeownership rate today at 78 percent.
A more apples-to-apples comparison of the generational divides in homeownership can be made by controlling for age. The chart below shows that at each stage of life, the last three generations have bought homes slower than the generation that preceded them. Millennials have had the slowest transition from renters to homeowners. By age 30, 42 percent of millennials owned their homes, compared to 48 percent of gen Xers, 51 percent of baby boomers, and nearly 60 percent of silents. That gap persists through their 30s and into their early 40s.
A handful of economic and cultural factors explain these generational gaps. The most significant was the Great Recession, which suppressed homeownership across all generations but was particularly damaging to millennials, whose early career trajectories were shaped by a historically unstable economy. During the economic recovery that followed, many millennials were drawn to centrally-located jobs in cities where starter homes became increasingly scarce and expensive. While many millennials purchased homes during these years, others spent more time living at home or in rentals, delaying major life events like homeownership, marriage, and childbearing when compared to earlier generations.
In 2020, the COVID-19 pandemic drove an even deeper wedge between millennial homeowners and millennial renters. On one hand, millennials purchased an outsized share of homes during the first two years of the pandemic, when mortgage rates fell below 3 percent. On the other hand, housing inventory dropped to all-time lows and for-sale prices skyrocketed more than 40 percent. For millennial renters who could not afford to buy a home in the earliest stages of the pandemic, homeownership opportunities waned dramatically in the years that followed. Mortgage rates spiked, bringing modest relief to list prices but pushing monthly ownership costs even higher.
