For Gen Z, the dream of owning a home is looking more like a challenge than ever before. With high housing prices and interest rates, the idea of buying that first house can feel daunting — if not impossible. As of 2023, just 26.3% of adult Gen Zers owned a home, a slight increase from 26.2% in 2022, according to Redfin. In contrast, 54.8% of millennials, 72% of Gen Xers and 78.8% of baby boomers currently own homes.

Despite these odds, Gen Zers are determined to find a way. A recent InMyArea.com survey found that 32% of Gen Z non-owners plan to buy a home within the next five years, while 38% aim for longer. Although 30% have no plans or remain unsure — the lowest rate among the generations — many are exploring creative strategies to make homeownership a reality. Here are four ways Gen Z is working to buy their first homes.

Pursuing Fixer-Upper Properties

For many in Gen Z, foreclosures and fixer-uppers present an opportunity. While these types of properties require an appetite for renovations and repairs, they also offer below-market prices. Distressed properties are letting Gen Z buyers get into the market, with 15% choosing fixer uppers over move-in-ready homes.

For those who are willing to put in the work, these homes provide a way to start building equity without the full cost of a new or ready-to-live-in property.

There are several renovation loan products to help you purchase the home and roll in the improvement costs.  Contact Curt Tiedeman at NewRez Home Loan Division to discuss.  Curt’s license NMLS 35554, phone 206.650.4202 and email curt.tiedeman@newrez.com

Juggling Multiple Jobs or Side Hustles

In today’s gig economy, Gen Z is no stranger to juggling multiple income streams, and for many, that’s a key strategy to afford their first home.

Many are maximizing their income with freelancing, side gigs or rideshare driving, with the InMyArea survey sharing that 33% of Gen Z homeowners worked multiple jobs to make homeownership a reality. Freelancing platform Upwork also reports that 53% of Gen Z freelancers now work full-time hours on freelance projects, preferring flexibility over the traditional 9-to-5.

Leveraging Family Support

Family support is proving to be a key factor in achieving homeownership, with 27% of Gen Z homeowners having inherited or been gifted property — the highest rate across all generations in the survey. Another 18% received financial assistance from family, and 11% bought property from friends or family members.

These contributions help young buyers offset the high costs of homeownership, making it more attainable for those with family resources.

Many new home buyers have parents, siblings, or relatives co-sign for them.  There are risks for non-occupant co-signers, but overall, it is a good way to qualify for a home without having sufficient income on your own.  Discuss with Curt Tiedeman at NewRez to get all the facts before starting down this path.  See Curt’s contact information above.

Exploring Government Grants and Assistance Programs

State down payment assistance programs aimed at first-time homebuyers are also helping Gen Z buyers afford a home. These programs lower barriers by reducing initial costs or offering down payment assistance, providing an entry point that might otherwise be out of reach. About 8% of Gen Zers are using these resources, taking the time to research programs that can provide vital financial support.  Curt Tiedeman with NewRez Home Loan Division has been teaching first-time home buyer education for Washington State’s down payment assistance programs for over 20 years.  Reach out to Curt at 206.650.4202 or curt.tiedeman@newrez.com to find out more information.  Use the Class Schedules on this site to register for a class.

Gen Z is proving that with flexibility, resilience and creativity, they can tackle the traditional barriers to homeownership.

Source of the article:  Emily Fowler | yahoo.com

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