Most millennials are homeowners now
The housing market today looks a lot different than it did a few years ago. Back when mortgage rates were at record lows, student loan repayments were on pause and savings rates were high, buying a home seemed like a good idea. One demographic in particular took advantage of this window of opportunity for homebuying: millennials. As of 2022, a slim majority of millennials now own homes.
“Marketplace” host Kai Ryssdal talked to Venessa Wong, a reporter writing for The Guardian, about her recent article on how millennials became a majority homeownership group, and the challenges to homeownership that millennials have faced. The following is an edited transcript of their conversation.
Kai Ryssdal: I confess I was intrigued by the headline on this piece. And we all know that writers don’t get to write their own headline but it says most U.S. millennials finally own homes. And that surprised me.
Venessa Wong: It surprised me too. So millennials have been sort of characterized for such a long time as a generation that’s faced a lot of economic hardship, particularly with the housing market, which has continued to rise whilst wages stagnated for decades, honestly. So 2022, we saw millennials become a majority homeowner generation, which 51.5% of millennials now own a home. So it’s a small majority, but hey, you know, they crossed over that middle line.
Ryssdal: What happened? What got millennials from being really challenged actually to in 2022 so many of them owning homes.
Wong: There was a number of conditions created during the pandemic, that surprisingly, put a lot of people in a position to buy. So we had probably most importantly, low interest rates at that point, we had an emergency pause on student loan payments, people were benefiting from stimulus checks. And then the pandemic also means streams of remote work. So a lot of people were able to move to areas with more affordable housing than America’s central job markets.
Ryssdal: One hates to be a downer here, but that window of opportunity, of economic opportunity that you just described for a lot of these folks, does seem to have closed, right? Because student loan payments are coming back on, interest rates I don’t think we need to mention because everybody knows where they are. So those millennials who got in are the fortunate ones in that, like, two, three-year period.
Wong: That’s right. Yeah. I mean, for a brief moment, people caught a break. But we are seeing a reversal. Trends show that millennials still aren’t where previous generations had been. Just by way of data by age 30, 42% of millennials own their homes. And that’s compared to 48% of Gen X, for example.
Ryssdal: We should remind folks, why homeownership matters entirely apart from the whole American Dream thing, which has its own, you know, challenges. But owning a home in this economy is the single best way to build wealth, right?
Wong: That’s right. Yeah. I mean, a lot of people continue to look at homeownership as a wealth building tool. It’s difficult right now, especially when you have other forms of debt when you have student loan debt, medical debt, credit card debt. A lot of people are questioning the value of a lot of things that we saw as investments in our future before homeownership, and honestly, like, higher education included.
Ryssdal: None of my business and I don’t want to ask you how old you are. But are you a millennial?
Wong: Oh, yes.
Ryssdal: So what about your friends and age group colleagues. How do they feel about homeownership?
Wong: I am one of these old millennials. I graduated from grad school in the middle of the great recession. So a lot of times when I write these stories, you know, I can relate to a lot of the experiences that people are telling me about, about just what they’ve gone through and sort of what I guess their expectations for their future would be versus what the reality has turned into. Housing is, for a lot of my peers, a huge challenge. I mean, I live in New York City. So no matter what housing is not on your side, it’s too expensive to rent. It’s too expensive to buy. You know, on a personal level, I mean, I live in the same neighborhood that I grew up in, in Brooklyn, and I couldn’t afford my parents house. So you know, and I think I have a decent career and job. I don’t know, it feels kind of hopeless sometimes.
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