Key facts
- Gen Z and millennials experience significant financial anxiety and shame, impacting homebuying decisions.
- Over half of respondents are anxious about their financial future and distrust experts.
- 66% worry their finances will not last, even those with high incomes and savings.
- 60% find the volume of homebuying information overwhelming.
- Nearly 90% report some level of financial shame.
- Homeownership is seen as a primary source of financial security by many.
A new report from National MI and FirstHome IQ highlights how financial anxiety, shame, and uncertainty are shaping the homebuying decisions of Gen Z and millennials, even among those who are financially qualified.
The study, "How You’re Built to Buy: A NextGen Homebuyer Report," found that over half of respondents are anxious about their financial future and skeptical of experts, regardless of their income or savings. Sixty-six percent worry their finances will not last, and 60% feel overwhelmed by the amount of information available on homebuying. Financial shame is also prevalent, with nearly nine in 10 respondents reporting some level of it.
Despite these psychological and informational barriers, homeownership is still viewed as a significant source of financial security. More than half of respondents believe they can achieve their financial goals, and six in 10 stated that owning a home would make them feel more secure than any other financial action. However, 43% also perceive a mortgage as a trap.
Researchers noted that traditional measures of homebuying readiness, such as savings and credit scores, do not fully capture the hesitations of these younger generations. A continuing knowledge gap exists regarding down payments, with many still believing a 20% down payment is necessary, despite the availability of lower down payment options supported by private mortgage insurance.