Go-getting Gen Z
It looks like Generation Z is coming at homeownership faster than their Millennial counterparts. Though many Millennials aren’t buying homes until their 30s, according to a new survey, more than half of Gen Zers plan to buy a home in the next five years — when they’re only 23 to 28.
Eyes on the prize
According to the Homebuyer Insights Report from Bank of America, the majority of 18 to 23 year-olds have serious homeownership ambitions. Nearly 60 percent say they plan to buy a home in the next five years, while more than half have already started saving for it.
They’re also willing to cut corners to make saving easier. About half said they’d reduce extracurricular activities, 48 percent said they’d take on another job, and almost a third said they’d move in with their parents in the interim.
As D. Steve Boland, head of consumer lending at Bank of America, explains, “Despite their young age, this group recognizes that buying a home is not easy and is taking a pragmatic approach to achieve their goal. Gen Zers are also prioritizing saving over frivolous spending and making sacrifices to prove that they are willing to do whatever it takes to own a home.”
Getting help to buy a home
But making sacrifices isn’t the only way Gen Zers plan to go from renting to owning.
They also expect to have financial help when purchasing their homes. More than 20 percent of Gen Zers said they’d get help from their parents, 17 percent said they’d use a down payment assistance program and 15 percent said they’d tap other family members. Most expect to pay those borrowed funds back, too.
For these would-be buyers, Bank of America executive Ann Thompson says it’s all about having a plan.
“Set your priorities,” Thompson said. “How you choose to prioritize your spending goes a long way. When asked what they’d do with $5,000, Gen Z said they’d rather put it toward a down payment over planning their dream wedding, going on a shopping spree or taking a vacation.”
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