Gen Z is open to getting creative and making sacrifices, slashing personal budgets and willing to consider fixer-uppers to secure financial stability of homeownership.
Gen Z (born 1997-2012) will soon become new housing market power players as the oldest members begin to hit their late 20s and enter prime homebuying years. While there’s been a lot of chatter about the average age of first-time homebuyers being older, Gen Z could be poised to reverse that trend in 2026 and beyond. However, it will require the same resilience and savviness that has been a hallmark of their upbringing.
For starters, they are entering the market with a unique life experience and perspective. Their parents suffered through the 2008 financial crisis before experiencing a crisis of their own: a pandemic. They now face the most expensive housing market in history. That distinct history will influence buying behaviors that may differ markedly from millennials.
In fact, the transition may be already starting. A Redfin analysis found that the homeownership rate for adult Gen Zers is higher than it was for millennials and Gen Xers when each of those groups was 24 years old – 27.8%, compared with 24.5% for millennials and 23.5% of Gen Xers when they were that same age.
Learn more about what Gen Z may bring to the housing market in the coming year, and how the industry is preparing.
The Gen Z Financial Profile: Pragmatism Over Idealism
In a sweeping study on Gen Z by EY Global, the researchers referred to this group as
“the ‘Pragmatic Generation,’ approaching life milestones not with rebellion but with reasoned scepticism and a global perspective.”
This notion carries over to how they feel about becoming homeowners. A big part of their motivation to buy a home is to set themselves up for future financial security. For example, one survey cites that 87.2% of Gen Z said homeownership is important for wealth-building. In other words, they see home ownership as a practical investment that’s worth making some financial sacrifices to attain.
This generation also values saving money and paying off debt as a badge of honor, and tends to be more transparent regarding money topics that previous generations sometimes found taboo. Some examples:
In a Santander Bank survey, six in 10 Gen Zers (58%) increased their savings in 2025, with 69% saying they made sacrifices to save.
They’re less worried about spending stigmas. Two-thirds (66%) of Gen Z said in a Bank of America survey they don’t feel pressured by their friends to spend beyond their means, and 42% feel comfortable declining social activities due to lack of funds and letting their friends know that’s the reason.
A Harris Poll revealed that over half of Gen Z (57%) have a side hustle.
The "Good Enough" Home: Valuing Affordability Over Perfection
Gen Z is indeed pragmatic when it comes to buying their first home. They're less fixated on the "dream home" concept that captivated millennials. Instead, they view homeownership as a financial stepping stone rather than being overly focused on if the home has curb – or Instagram – appeal.
Practicality is certainly a priority [for Gen Z]. I’ve noticed more of an inclination towards fixer uppers.
“Practicality is certainly a priority [for Gen Z]. I’ve noticed more of an inclination towards ‘fixer uppers,’” says Zoe Sigman, a Realtor based in California. This jibes with a survey by This Old House that found Gen Z was 57% more likely than millennials and 89% more likely than Gen X to own a fixer-upper. “If the buyer has the confidence that they or someone they know is fully capable of making the necessary or preferred repairs/alterations to the home, this can be a more attainable route to homeownership,” adds Sigman.
Younger buyers are also more willing to compromise on the old “location, location, location” mantra since many of them have the ability to work from a home office at least part of the week. “This allows this group of young adults to take advantage of more affordably-priced housing on the outskirts of large cities, or in some cases even live out of state if they currently work in a state with relatively high median priced homes,” says Sigman.
Location Priorities: Walkability and Community Over Commutes
Though setting up roots in a trendy neighborhood isn’t at the top of Gen Z’s priority list, location still does matter in terms of the home’s proximity to the things that are important to them. “Younger buyers definitely care more about amenities and things like walkability and community (versus space and privacy). For example, they'll definitely choose an older bungalow that needs updates in a walk-to-town location over a larger, more modern home 15 minutes away from shopping or restaurants,” says Sigman.
Gen Z is really into its social spaces whether its parks or coffee shops, or really anything that fits their lifestyle, agrees Meg Mullin, a real estate agent with Coldwell Banker, based in Madison, NJ. “I find that many of my clients are really excited about good schools, access to the city, and a charming and vibrant downtown,” she says.
I find that many of my clients are really excited about good schools, access to the city, and a charming and vibrant downtown.
Alternative Housing Enthusiasm: Condos, Townhomes, and Co-ops
With median single-family home prices still high ($410,800 as of July 2025), Gen Z has signaled an openness to alternative properties more so than millennials. For example, they're comfortable with:
Condos: The appeal here is lower maintenance costs and included amenities, as well as falling prices as compared to single-family properties
Townhomes: These offer more affordability with a single-family home feel. In fact, 10% of buyers younger than 34 bought townhouses in 2025 according to an National Association of Realtors (NAR) report, the highest percentage by age group.
Manufactured/mobile homes: Because of their affordability, Gen Z has also warmed up to buying these properties, with 61% indicating that they were likely to consider purchasing a manufactured home in the future, as per a Freddie Mac report.
Each of these options provides a lower entry cost, and to some extent, less maintenance responsibility, which aligns with Gen Z’s lifestyle.
The Tech-Native Buyer: Digital-First Home Shopping
Gen Z is the first truly digital native generation, and it’s no wonder that much of their homebuying research is conducted online before they even contact agents. They watch virtual tours, and use social media, apps and now AI to learn get real estate insights. “This group has a real advantage, having access to so much data and online tools, such as market trends, neighborhood data, mortgage and lending data, various online search platforms, financial and analytical tools etc.,” says Sigman.
Plus, she adds, they are generally more financially literate at a young age because of the influx of financial content in their feeds.
Mullin says that social media and digital preference play a huge role in how she works with her clients, too, especially the younger ones. “I'm getting a lot of inquiries and questions from people who follow me on Instagram. I think they're using social media to explore the lifestyle and vibe of different communities,” says Mullin.
Family Wealth Transfer and the "Bank of Mom and Dad"
For some fortunate Gen Z buyers, mom, dad, and other family members are helping them bridge the gap of rising home prices with down payment gifts, co-signing, inheritance acceleration, and family loans with favorable terms. ”I would estimate that 30% of my Gen Z clients receive some kind of financial assistance from their parents,” says Mullin. “Honestly, it's a very good way to pass down wealth and see your kids enjoy it while everyone is still alive and healthy, and to give adult children an edge in an extremely competitive (and expensive) housing market.”
While it can add another layer of emotional and legal considerations when mixing family and real estate, for the most part Mullin says it usually works out wonderfully. “There is usually just immense gratitude from my Gen Z clients. One client said quite explicitly (and I paraphrase): ‘I don't make enough money to truly afford this area, and I'm so lucky my parents can help.’”
Co-Buying: Friends as the New Co-Owners
Considering that Gen Z is getting married and starting families later than past generations, more of them are open to non-traditional homebuying strategies, like purchasing with a friend or two. In fact, Generation Z, though only 3% of the market, boasted the highest share of single-female homebuyers at 30%.
In some scenarios, co-buyers may live as roommates, but in other cases, they go into the purchase as investment partners. In the 2025 NextGen Homebuyer Report, 32% of Gen Z respondents said they are considering co-buying. And, they are 78% more likely to consider co-buying than Millennials.
For buyers considering this route, there may be different legal structures involved, and lenders can view these arrangements a bit differently than, say, a couple buying a home together. This can include:
Tenants in common: This is a legal structure in which multiple parties can hold different ownership percentages of a property they purchase together.
LLCs: Going this route allows buyers to separate personal assets from property liabilities.
Though she hasn’t experienced these types of sales among single-family buyers, Mullin says buying with a friend has been a useful strategy for other scenarios. “Here in New Jersey, it's fairly common for people to purchase shore or vacation homes with a friend or non-immediate family member (like a cousin). It's also fairly common for people to purchase investment properties together,” she says.
Sustainability and Future-Proofing: Non-Negotiable Considerations
More than 4 out of 5 prospective home buyers consider climate risks as they shop, according to Zillow research, with younger buyers more likely to say so. Part of this is because of Gen Z’s pragmatism, wanting to choose a home with long-term viability. The other reason is climate anxiety, which nearly four in ten (38%) GenZers report feeling most or all of the time. For that reason, they may be more insistent on performing a climate risk assessment for homes they are considering.
Among the top green features Gen Z buyers are demanding include energy efficiency, solar panels, environmental certifications, and sustainable building materials, and they are willing to pay premiums for these attributes. One survey found that 70% of Gen Z would go over their budget for a green home.
What Gen Z's Entry Means for the Market
Based on Gen Z’s consumer behavior in other sectors, overall pragmatism, and openness to alternative homebuying solutions, there’s no doubt that as more of them reach homebuying age, the real estate market will have to adapt and shift to meet their unique needs and preferences. Whether that’s a boost in condo/townhome construction, a bigger focus on digital tools, or more emphasis on marketing the sustainable attributes of properties, Gen Z’s impact is only just beginning.
Says Sigman: “Despite current affordability and housing stock challenges, Generation Z is in a position to shape the housing market as a resilient, educated, and resourceful generation that leverages technology, and creative solutions to achieve homeownership.”
