Buying a home has advantages and disadvantages, and may or may not be the right choice at any age or stage of life. But it’s long been seen as the “American Dream” – not to mention a dependable way to build wealth and obtain more economic stability than is typically available to renters. And for young people, achieving homeownership is often seen as a rite of passage, a step toward becoming an adult.
But new data seems to suggest America is moving backward, not forward, in making that possible.
Molly Goodman is the co-founder of Abundant Housing Massachusetts, a housing advocacy organization. Goodman has dedicated much of her career to helping people into homeownership, including by conducting housing counseling trainings. The recent disparity between Boomers and millennials feels “bleak,” she said.
Older generations had more success becoming homeowners, Goodman said. “We see the outcome of that. They established houses, had families. But many of their children can't accomplish the same things, and it's definitely not for lack of trying.”
Young people –Goodman is also a millennial – know the reasons for their plight are familiar, but they still chafe. Among them: residential construction has fallen short of the needs of a growing population for over a decade, making housing scarcer and pricier.
In 1984, when a Baby Boomer might have been roughly the same age Brandi Ross is now, the median-priced home cost $78,200. Adjusted for inflation, that’s $240,700. But the median-priced home today is $403,700 – 80% more.
What’s more, Americans are entering their working years with more student debt than ever before as the cost of higher education has skyrocketed and more schooling is required for most career pathways.
That’s a big hurdle, perceived or real, for many younger Americans. In December, Nicole Robinson, a 26-year-old school administrator in Richmond, Virginia told USA TODAY that many people her age have so much student debt that most have given up on homeownership. Robinson and her husband do own their home, but she isn’t sure they’ll ever be able to afford children.
Robinson’s mother Terri is a real estate agent in northern Virginia. Terri isn’t as concerned about the statistics from NAR. It’s only natural for Boomers to be downsizing, she said, particularly as they get ready to move into housing that’s more age and lifestage-appropriate – and it makes sense that those who are older have the home equity to be able to buy their next home in cash.
Still, she said, the knowledge that young people like her daughter think home ownership is unobtainable “saddens” her.
“They are also saddled with high cost from college tuition,” Robinson said. “I think that's a really heavy burden on them. At the same time, the job market itself isn't as assured just because you got a college education. And they feel correctly, I think, that their dollar doesn't go as far in the housing market.”
Robinson also believes that training and counseling can go a long way toward helping many Americans achieve better outcomes in the housing market, and that many simply aren’t aware of their options or how to capitalize on them.
Brandi Ross, however, lives with a strong sense that housing is increasingly bifurcated between haves – whether they are those who can afford to buy thanks to family help or landlords lobbying for laws that favor them over tenants – and the have-nots, like herself.
“I absolutely believe this is a policy failure,” she said.
