Gen Z Reveals Themselves to Be Practical Home-Owners

Gen Z Reveals Themselves to Be Practical Home-Owners

  • Gen Z is quickly becoming a major player in the home-buying market.
  • The young generation is cost conscious and ready to settle down.
  • Gen Z is starting off with better financial footing than Millennials. 

Gen Z, occasionally referred to as iGen or Centennials, is the group born between approximately 1997 and 2012. While many in Gen Z are only just finishing college and stepping into the business world, they are already eager to set down roots. According to this Realtor.com article, these young adults are buying roughly 2% of the houses on the market. This is Gen Z’s first appearance on this respected real estate trends report, the article states. Gen Z appears to be coming into the home-ownership scene early, strong, and ready to stay long-term. 

A Financially-Savvy Generation

While this generation is ready for a place to call their own, they don’t necessarily have a lot of money. At least not yet. They are still young and the oldest are only now in their early to mid-20s. They are more cost conscious, however, than other generations, and are already known for making smart, financially-sound choices. They are moving into less expensive homes in affordable areas. And most of the areas happen to be where they went to college. The most popular for Gen Z buyers is currently Toledo, OH, followed by a few other small cities in the South and the Midwest.

Gen Z: A Step Ahead of Past Generations

The letter Z might denote the end of the line, but this generation is not lazy or indifferent when it comes to financial goals. I spoke with Realtor.com recently on this phenomenon, sharing that “Gen Z could leapfrog many millennials financially, as they’re starting out on better footing. Gen Z is more practical with their money than previous generations. They’re better positioned to enter the home-buying market than millennials when millennials were the same age. They’re savers, and they’re looking for stability.” As we develop a picture of Gen Z as consumers, it should be known that they’re sensible and future-thinking.

Less to Invest But Still Committed

While Gen Z is jumping head-first into home-buying, they aren’t putting as much into their down payments. We often hear that 20% is the standard amount to put down for a home. It seems that no generation is putting that amount down, on average. But Gen Z is definitely putting down the lowest, coming in at about 5%. They are determined to be homeowners, though, despite the fact that the lower down payment will likely cost them more on a monthly basis and in interest and mortgage insurance payments given the larger amount being financed. 

The Financial Future of Gen Z

It’s exciting to see Gen Z emerge as buyers in the home market. We are just beginning to shape a deep, research-based understanding of Gen Z as consumers, and at CGK, we are eagerly researching Gen Z to see what kind of impact this up-and-coming generation will make on our world. Right now, we have studies going on about Gen Z and retail payments, workforce, insurance, technology, and much more on multiple continents!

What Role Does Gen Z Play in Your Organization?

How is this young generation of practical future-thinkers relevant to you? If you’d like to find out more about how to unlock their workplace and consumer potential in your organization, contact us here and we’ll set up a call to discuss how we can help. We deliver custom keynote speeches, research, and consulting that solves generational challenges.

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