Owning a home has always been a big part of the American Dream. But for many, especially younger adults, that dream is increasingly out of reach.
Elevated housing prices, skyrocketing interest rates and tight inventory are making home ownership an unrealized dream for a growing number of Americans.
Mortgage rates have doubled since the start of 2022, edging toward 7% after a series of interest hikes by the U.S. Federal Reserve.
A survey earlier this year by Bankrate, a consumer financial services company, found that adults between ages 18-41 who want to own a home say their biggest roadblock is being able to afford one.
Affordability has been particularly difficult for millennials (ages 26-41) who now comprise the largest share of potential U.S. homebuyers.
“For the most part, the younger generation still have that desire to buy a house,” Walter Key, a real estate agent near Jacksonville, Florida, told VOA. “But many of them are finding it tough because they are paying rent for apartments, which keeps going up, and makes it hard to save to buy a home.”
Boston resident Amber Corbett, 28, knows just how hard it can be.
“While I think about the possibility of owning a home, I can’t see it happening for a long time,” said Corbett, who is single and graduated from college six years ago. “Boston is an expensive city, my rent is high, and I have debt from paying for college.”
Lauren Hwang, a real estate agent near San Francisco, said home sellers are also hampering home ownership, because they are “closing the doors on a lot of 20-somethings.”
Some younger adults have pooled their financial resources with friends to buy a home they can all live in together. But as more millennials delay marriage and having children, some still live at home with their parents, trying to build a nest egg to buy a place of their own.
“I save a lot of money by staying with my family,” said Kyle Kaczenski, 26, an auto mechanic in Columbus, Ohio. “I’m hoping to buy a small house in the next couple of years and trying to put away as much money as I can so I don’t have a big mortgage, especially since interest rates are going up now.”
Some parents are providing the down payment to help their live-in children buy a starter home. However, Blake Brennan of Woodbridge, Virginia, managed to buy a condo without his mother’s help last year when he was 20 years old.
“I didn’t want to rent an apartment, because renting is a big waste of money, and there’s no long-term financial return,” he said during a VOA interview. ”When I was 16, I kept the money I earned from part-time jobs. And when I finished high school, I got a fairly good job and saved most of my money I earned. So, I had enough for a small down payment on a condo.”
He said it also helped that his real estate agent told him about first-time homebuying options.
“There are different programs many young adults don’t even know exist,” explained Gary Eales, a real estate agent in Alexandria, Virginia. “A lot of people assume you still need to have the traditional 20% down payment to purchase a home, but that’s not the case anymore.”
Finding an affordable house was a challenge for Kasi Martin who lives in Alexandria, Virginia, an affluent Washington suburb.
She said she found the cost to buy a house in Alexandria “shocking after growing up in a small town.” The 33-year-old teacher, wife and mother said it was a challenge to find the right home.
“We were living on a very tight budget” before we found our dream home that we plan to live in for many years,” she told VOA.
Homebuyer Christian Chacon, 26, said he and his wife had to make a trade-off in order to purchase a single-family home in Virginia.
“We couldn’t afford to live close to a military base near Washington where I work, since the prices of homes are sky high. So, we moved to a city further out in Virginia where houses were cheaper — which means I have a really long commute to work, but it is worth it.”
In Austin, Texas, Nick Sherwood, a 29-year-old website designer who is engaged, is eager to buy a single-family house. But with college loans he is continuing to pay off, he is waiting to see how much relief he will get under the Biden administration’s student loan forgiveness program.
“Hopefully getting thousands of dollars in relief will make it easier for us to buy a home we can live in for a long time,” he said.