Published by FOX Business | December 28, 2023
64% of Americans are homeowners, a rate lower than that of China and Brazil
Gen Z no longer sees homeownership as an aspiration and is increasingly balking at mortgages to rent in luxury amenity-filled apartments instead.
Young Americans have taken to social media apps like TikTok in recent months, claiming it is nearly impossible to buy homes in the current economy, citing student loans, high mortgages and low-salary job opportunities.
The Wall Street Journal recently revealed that homes in Scranton, Pennsylvania, are listed at a median price of $179,900. With a $150,000, 30-year mortgage at a 7% rate, the average monthly payment would sit near $1,000.
However, Americans who would typically purchase a home have opted for long-term rentals. Some have said they have no plans to ever buy a house.
Real estate investor GID, which owns or manages around 50,000 apartments in the U.S., said nearly a quarter of its renters earn over $200,000. Additionally, 64% of people in the U.S. are homeowners. This is well below the number of homeowners in China and Brazil, which sit at 89% and 72%, respectively.
“This is not a financial thing; this is a cultural thing,” Brenberg chimed in. “This is a move among younger generations where ‘I want an experience, I want to travel.’ It feels good now — I get it. It feels good. But 30 years down the road, you’re going to be saying, ‘What happened to that money?’ Well, it went over to this guy.”
He admitted that it is very difficult to buy a home right now when considering the economy and the fact that those with a low mortgage rate do not want to sell.
“I’m not saying that young people have it easy.” said Brenberg. “The problem is folks who could be in a position or who are in a position to buy a home and they’re saying, ‘I don’t want to deal with the upkeep or the maintenance or the work’ — and it’s like if you don’t put sweat equity into something, you’re not going to get anything out of it.”
