A Freddie Mac survey of Generation Z reveals that demographic has a more positive perception of homeownership than millennials held at the same age.
According to the survey, Gen Zers estimate that they will attain homeownership by age 30, three years younger than the current median homebuying age. Gen Zers surveyed (ages 14-23) believe owning a home provides more privacy, control and independence than renting.
The survey also revealed that Gen Zers feel owning a home is a sign of success, is something to be proud of and provides stability and financial security. Freddie Mac said Gen Z is less likely than millennials to see renting as more appealing than buying a home.
“The data show that while members of Gen Z clearly aspire to homeownership, they are realistic about potential barriers and understand the potential benefits of renting,” Freddie Mac CEO David Brickman said in a release. “Although these results are good news for the housing markets, they also highlight the challenges many in Gen Z will face as they enter the market to rent or buy.”
More than seven out of 10 Gen Zers surveyed would choose to live in a single-family home over other types of homes, and more than half (59 percent) report their ideal home would be medium-sized, the survey found. Thirty-five percent said they would choose to live in a suburb of a big or medium-sized city, with an additional 30 percent preferring to live in a rural area or small town.
Compared with past surveys of millennials, fewer Gen Zers (19 percent to 30 percent) see renting as more appealing than buying; fewer believe renting makes you feel like part of a community (33 percent to 39 percent); and fewer perceive that it costs less to rent a home than to own a home (40 percent to 51 percent).
“One of the biggest challenges millennials face today is the lack of affordable starter homes,” Freddie Mac Chief Economist Sam Khater said. “Given Gen Z’s desire for suburban medium sized homes close to urban areas with amenities, demand for entry-level homes will intensify.”