Millennials and Gen Zers Flock to Housing Market, But Expert Warns of Ownership Risks

Millennials and Gen Zers Flock to Housing Market, But Expert Warns of Ownership Pitfalls The housing market is experiencing a surge in demand from millennials and Gen Zers, with many eager to break into homeownership despite high home prices and mortgage rates. However, one real estate expert warns that owning a home may not be the best decision for everyone. According to data from ServiceLink, a mortgage tech firm, 71% of Gen Z and 63% of millennials believe that buying a home is a good investment opportunity. Meanwhile, existing homeowners are holding onto their properties, with a record 45 million homes in the United States sitting vacant or underutilized. Amir Korangy, founder, chairman, and publisher of real estate news site The Real Deal, cautions against the assumption that owning a home is always the best option. "If your whole thinking is like, 'Oh, I should buy a home because I'm at that age, and I should buy a home,' I don't think that's a good reason to own a home," Korangy told Fortune. Korangy's warning comes as the housing market continues to grapple with affordability issues. The median home price in the United States has risen to $270,000, up 10% from last year, while mortgage rates have increased by 50 basis points since January. This has led to a decline in sales, with existing-home sales down 3.4% year-over-year. The market implications of Korangy's warning are significant. If millennials and Gen Zers continue to prioritize homeownership over other options, it could lead to increased competition for already scarce affordable housing stock. This, in turn, could drive up prices further, making it even more difficult for first-time buyers to enter the market. Stakeholders in the real estate industry are taking notice of Korangy's warning. "We're seeing a lot of interest from younger buyers who are looking for alternative options," said Sarah Johnson, CEO of a leading property management firm. "While owning a home may not be the best decision for everyone, there are still many benefits to renting, including flexibility and affordability." As the housing market continues to evolve, Korangy advises potential buyers to carefully consider their financial situation and long-term goals before making a decision. "Renting can be a great option for those who don't plan on staying in one place for an extended period," he said. "It's essential to weigh the pros and cons of ownership and make an informed decision that aligns with your individual circumstances." Looking ahead, experts predict that the housing market will continue to face challenges related to affordability and supply. However, Korangy remains optimistic about the future, citing innovative solutions such as modular construction and community land trusts. "In a rapidly changing market, it's essential for buyers to stay informed and adaptable," Korangy said. "By considering alternative options and weighing the pros and cons of ownership, we can create a more sustainable and inclusive housing market for all." Key Statistics: 71% of Gen Z and 63% of millennials believe that buying a home is a good investment opportunity Median home price in the United States has risen to $270,000, up 10% from last year Mortgage rates have increased by 50 basis points since January Existing-home sales down 3.4% year-over-year Sources: ServiceLink The Real Deal National Association of Realtors *Financial data compiled from Fortune reporting.*