- 31% of Gen Z live at home with a parent or family member
- 24% of renters in America say they can no longer afford their rent
- 38% of renters are sacrificing necessities to pay their rent, including older generations
Home ownership is in the rearview for many Americans as prices for everyday goods and services remain elevated and mortgage rates hover at a 20-year high. Rising housing costs are impacting more than current and prospective homeowners; renters also struggle to make ends meet while others crash at home to save money.
According to a recent study conducted by Intuit Credit Karma, 48% of Americans don’t own a home. Instead, 36% rent and 11% live at home with their parents or other family members. The percentage of people living at home jumps to 31% when looking at Gen Z respondents, many of whom have struggled to flee the nest.
Of those who currently rent, nearly a quarter (24%) say they can no longer afford to pay their rent. This problem was most pronounced among millennials and Gen Z (30% and 27% respectively), compared to just 10% of respondents aged 69 and above. To make ends meet, many renters (38%) are having to sacrifice necessities to pay their rent, including 41% of Gen Z and millennials. Rising rent costs aren’t just impacting younger generations, either. 42% of Gen X and 25% of boomers also report having to sacrifice necessities to pay rent.
What’s more, some renters are reconsidering their living situation altogether. According to the study, nearly one-in-five (19%) American renters say they’ll have to move in with their family or friends because they can no longer afford their rent. This number jumps to 25% for Gen Z and millennial renters. For those who are able to remain in their current housing, 21% say they’re dependent on money from their family to do so – especially millennials and Gen Z (31% and 25%, respectively).
The cost of housing has cast a shadow on homeownership in America
Nearly half of Americans (46%) believe they will never be able to buy a home, which explains why 76% of respondents who do not currently own a home are not in the market for one. Of those who are not in the market for a home, 49% say mortgage rates and inflation have made it impossible for them to buy right now. Others are waiting for mortgage rates to drop (39%) or delaying their plans as they wait out a potential recession (34%). In addition to current market conditions, 29% of respondents who are not in the market for a home say they’re fearful of buying a home because they’re worried about their job security.
The brave and the few: Prospective homebuyers
Of the 24% of Americans who are currently in the market for a home, 59% say they’re motivated to buy a home because rent is so high. However, with elevated interest rates, many are unsure if they’ll be able to afford as much home as they planned (56%) or if they’ll be able to afford a home at all (48%). Others have had to adjust their expectations when it comes to their home buying wishlist, including things like school districts and neighborhoods.
Of those who are still on the hunt for a home, 30% say they’re dependent on money from their family to make the purchase. This was especially true for millennials (39%).
“The current housing market has many Americans making adjustments to their living situations, including relocating to less expensive cities and even moving back in with their families,” said Courtney Alev, consumer financial advocate at Intuit Credit Karma. “What’s most concerning is that rising housing costs aren’t just impacting younger generations, but older generations, too. Our research shows more than half of Americans (57%) allocate the majority of their income toward housing costs, leaving little room elsewhere in their budgets. In general, it’s recommended that consumers allocate half of their income for essentials, including housing and other necessities, like groceries and household bills. The remaining 30% should go towards nonessentials – things like dining out and entertainment – and 20% should go towards financial goals, such as saving an emergency fund or paying down debt. If your housing costs exceed 50% of your budget, you might consider looking for other housing options. That could mean switching neighborhoods or moving in with roommates to cut costs.”
Methodology
This survey was conducted online within the United States by Qualtrics on behalf of Intuit Credit Karma from November 20 to November 26, 2023 among 1,249 U.S. adults above the age of 18.