Homebuyers

Gen Z Is Breaking Into the Housing Market—Here’s How They’re Pulling It Off

Buying a home has long seemed out of reach for many members of Generation Z. They face a real estate market of stubborn mortgage rates, high home prices, and student debt.

But Gen Z, those born between the late 1990s and early 2010s, is no longer sitting this market out.

In the first quarter of 2025, Gen Z accounted for roughly 25% of all first-time new mortgages, according to the May 2025 Mortgage Monitor Report from financial services company Intercontinental Exchange. 

In fact, they’re buying homes at a faster pace than some experts anticipated. Indeed, Gen Z accounted for 3% of all homebuyers in 2025, according to the National Association of Realtors (NAR). That might sound small, but for the youngest generation in the market, it marks a real foothold.

Here’s how the young generation is pulling it off—and what other buyers can learn from Gen Z's approach to homeownership.

Gen Z is saving early and spending selectively

Many Gen Z buyers aren’t waiting until their 30s to start thinking about homeownership. They’re budgeting with homebuying in mind from the outset, sometimes stashing away a portion of their income, which, in many cases, remains modest.

“They are entering homeownership with the lowest household incomes,” the NAR report stated.

For some, it’s about cutting back on big-ticket items like travel or new cars. For others, it’s about staying longer in multigenerational households to avoid rent and build a nest egg.

“My own son, who is a Gen Z, is living at home and saving,” said Jeff Lichtenstein, CEO and broker at Echo Fine Properties in Palm Beach Gardens, Fla. “He has buckets for going out on a date and doing fun things, but he literally has a bucket account that goes in each week for a future home.”

Gen Z is tapping  into the bank of Mom and Dad

Parental financial support still plays a significant role for many in Gen Z.

“We’ve seen grandparents and parents help out or gift homes to kids,” said Lichtenstein. 

However, gifting cash is not the only way Gen Z is breaking into homeownership with their family’s help.

“Some parents and grandparents are selling investment properties and doing a tax-deferred exchange to buy homes for their kids and grandkids,” said Cara Ameer, a bi-coastal agent with Coldwell Banker licensed to practice in California and Florida.

But what’s different about this generation is how strategically they deploy that help. Many are remaining flexible on home features, such as forgoing Instagram-worthy kitchens and more square footage and focusing on long-term equity growth instead.

For example, Gen Z purchases more “older homes than other buyers,” the NAR report stated.

Many Gen Z are leaving big cities behind

While many millennials chased starter homes in popular city centers, Gen Z is looking further afield. Remote work, which is now more common, has allowed many younger buyers to rethink where they plant their roots.

For example, Gen Z homebuying remains strong in more affordable parts of the country. States like Indiana, South Dakota, and Kentucky see Gen Z’s share of first-time buyer activity exceeding 30%, according to the Mortgage Monitor Report.

In contrast, pricier metro areas have seen limited Gen Z activity. In Washington, D.C., Gen Z accounted for just 7% of purchase mortgages, while in California, they represented only 8% of all purchase loans.

“My nephew lives at home in Brooklyn,” said Ameer. “He is looking to buy something outside of New York that he can have as a second home/vacation rental.”

Gen Z is negotiating with home sellers

Gen Z may not be flooding open houses in droves, but those entering the market are doing so at a time when sellers are more willing to make a deal. 

With housing stock finally up, more sellers are offering concessions, such as covering closing costs, funding repairs, or providing mortgage rate buydowns, which help Gen Z buyers enter the market. 

“I probably wouldn’t have been able to purchase the house if the seller hadn’t given me so many credits toward the house,” one 28-year-old buyer told CNN in late June. “They kept fixing things for me, too. Everything I asked for, they granted, so that was really nice.”

Gen Z is eyeing new construction

For Gen Z buyers in fast-growing or suburban areas, there’s an attractive option besides buying an older home. 

“Many are also turning to new construction if that is an option in their market, where the builders are offering aggressive [mortgage] interest rate buydowns and paying some or all closing costs, along with price incentives,” said Ameer.

Indeed, builders, eager to move inventory in a higher-rate environment, are sweetening deals with steep incentives. A May 2025 report from the National Association of Home Builders says that almost 60% of builders are offering lower mortgage rates.

Still, even with incentives on the table, affording a home sometimes requires extra hustle on the buyer’s part. Gen Z seems to understand this.

“That’s why so many of them have multiple side gigs or are getting creative about earning money,” said Seamus Nally, CEO of TurboTenant.