Gen Z leads the way in homeownership, especially in the Midwest, overtaking millennials and Gen X

A recent SmartAsset analysis reveals that cities like Indianapolis, St. Louis and Cincinnati are seeing an increase in Gen Z homeowners, while California and the Northeast lag behind.

Under 25 and unstoppable, these young buyers are snapping up homes at an incredible rate.

In 2023, nearly 28% of 24-year-olds owned homes, surpassing millennials and Gen X at that age, according to a January Redfin report. A whopping quarter of Gen Z, ages 19 to 26, entered homeownership last year.

Indianapolis tops the list with the highest share of Gen Z homeowners among major US metro areas.

Although only 1.6% of the local Gen Z population bought a home, it’s the best rate among the 40 largest cities. These 2,266 new homeowners are snapping up properties with a median value of $225,000 and earning a median income of $65,000.

St. Louis followed closely behind, with just under 1.6%, or 2,649, Gen Z homebuyers. There, the median property value is $185,000 and these young homeowners earn about $63,000 a year.

Other hot spots include Jacksonville, Virginia Beach and Kansas City — while Detroit, Cleveland and Pittsburgh offer homes typically under $200,000 with incomes under $65,000.

Despite Texas’ booming growth, none of its cities ranked in the top 10 for Gen Z homeownership.

Meanwhile, San Francisco, New York City, Los Angeles and Boston show the lowest rates, with San Francisco’s median home value for Gen Z exceeding $1 million and just 93 homes purchased by Gen Zers last year.

Gen Z’s advantage over older generations may be luck or time. Millennials started their careers during the 2008 recession, while older Gen Zers took advantage of low mortgage rates in 2020 and 2021. Telecommuting and hybrid work trends have also allowed them to buy in more affordable areas.

Social media has demystified the home buying process, with platforms such as YouTube and TikTok offering advice to young buyers.

Additionally, many Gen Zers who live with their parents save more, enabling them to buy homes earlier. Multigenerational living has increased over the past two decades, with a Pew Research Center report highlighting this trend.

However, the future is not all rosy. High student debt, rising mortgage rates and housing shortages may make it difficult for Gen Z to maintain this generation of homeownership. Forecasts of high interest rates and home values ​​suggest that those who have not yet bought may struggle to do so.

A Bank of America report from July found that nearly half of Gen Z rely on family financial assistance as they face higher daily expenses and lower wages adjusted for inflation than their parents.