While high home prices and elevated mortgage rates continue to deter homebuyers from purchasing, house hunters are still on the prowl.
New data revealed Gen Z largely finds homeownership to be valuable, financially and emotionally. An estimated 87.2% of Gen Zers surveyed said homeownership is important when it comes to building wealth, and almost 2 in 3—roughly 65%—say it's personally important to them to own a home.
Rather than seeing it as a symbol of success by achieving the American dream, financial security and stability were tied as the top two reasons why Gen Z wants to own a home, with 65% of Gen Z respondents who want to buy a home citing each of these factors as their main motivation.
However, research found only 25.2% of people under 25 currently own their home, according to Census data. High home prices were found to be the main reason why building wealth through real estate seems so unattainable for younger generations.
"Coming of age amid skyrocketing home prices and pandemic-era economic turbulence has given some of Gen Z financial whiplash, particularly when it comes to owning a home," said Cameron Wu, VP of Investments at Arrived. "There's this common perception that owning a home is just not something that young people can do."
Nearly 80% of Gen Zers said high home prices are their biggest barrier to entering the housing market. Since the oldest members of Gen Z entered adulthood in 2014, home prices have increased 58.7%.
With traditional homeownership being hard to reach, some Gen Zers say they prefer to invest their money in other ways. The survey found that, among Gen Zers who don't personally find being a homeowner important, 54.5% of them said it was because there are more profitable ways to build wealth.
"This is one of the key reasons we launched Arrived, to create ways for people to invest in real estate at any price point," said Wu. "And it's working–58% of Arrived users born after the year 2000 get started with an investment of just $100, helping them grow their wealth and invest in real estate without having to scrimp and save for a down payment that gets more expensive with every passing year."
To read the full report, including more data, charts, and methodology, click here.