"Even in a strong economy, young adults face difficulties in the housing market as they navigate a transitional point in their lives," wrote Whitney Airgood-Obrycki, a senior research associate at the Harvard Joint Center for Housing Studies (HJCHS), in a Nov. 3 blog. "But a softening labor market and, by many measures, the most challenging housing market in history will only compound these difficulties."
Adults aged 18-24 years comprise 30.5 million Americans, according to the report.
Few Young Home Buyers
Meanwhile, the 2025 Profile of Home Buyers and Sellers from the National Association of Realtors® (NAR) reveals just how hard it was for young adults to buy their own homes between mid-2024 and mid-2025:
- Just 2% of all home buyers were aged 18-24 years
- Only 10% were aged 25-34 years
"First-time home buyers in the last year shrank to a historic low of just 21% of all buyers," says the NAR report.
Historically, before 2008, about 40% of home purchases were made by first-time buyers, says NAR. What's more, the typical first-time homebuyer is now around 40 years old—a contrast to the 1980s when most were buying their first homes in their late twenties. The NAR report sais that for those who do manage to buy, the biggest obstacles to saving for a down payment are expensive rental payments and student loan debt.Unemployment is a Growing Issue Among the Young
Airgood-Obrycki's Harvard blog stressed the increasing difficulty young adults have in finding work. The unemployment rate for those aged 18-24 years was an eye-watering 10.5% in August this year, more than three times the 3.4% rate for all adults that month.
"Even before the uptick in unemployment, young adults struggled to form new households, had higher rates of cost burden, and were less likely to receive housing assistance despite having lower incomes," said Airgood-Obrycki. "These conditions have likely worsened as the economic headwinds against young adults have only intensified."
Accommodation of Mom and Dad
We're used to hearing about the Bank of Mom and Dad. However, a significant phenomenon now for the 30.5 million young adults is having Mom and Dad as landlords, according to the HJCHS.
A whopping 14.8 million 18-24-year-olds still lived with their parents in 2023, while a further 2.6 million lived with another relative. Another 3.3 million lived in "group quarters" (think college dorms), with the others mostly living with partners or sharing with roommates.
Only 5.2 million headed their own household, which often comprised one person.
Low Incomes and High Rents
In 2023, young adults were typically earning very little, calculates the HJCHS, based on U.S. Census Bureau data. Two in three were earning less than 80% of the area median income (AMI) where they lived, while 40% had incomes below 50% of their local AMI.
Combining low incomes with high rents creates extreme housing affordability issues. More than half of young adult households spent more than 30% of their income on housing in 2023. But that cost burden rate topped 58% for young adult renters, rising to 90 percent among very low-income renters."
And yet, few (9% of) young renters received any housing assistance. That compares with 24% of all adult renters with low incomes. So, young people are either not applying for assistance or are being refused it.
All this leads to housing instability, with more than half of young renters in 2023 having lived in their homes for less than a year. Some have to move much more frequently, which can result in job insecurity if relocating to a different neighborhood necessitates an unaffordable commute.
