Millennials show increase in plans to buy homes while other demographics stagnate

Older generations in the Gen X or Baby Boomer demographic feel locked in by their current interest rates, and cite concerns about higher rates as reasons not to buy a new home or sell their current one.

Laurie Flood, a realtor based in Austin who serves the Central Texas area, said older buyers have been reluctant to sell in the hopes that interest rates will go down, but are gradually starting to come around to the idea of buying or selling a home.

“As it becomes clear that higher rates are here to stay, I’ve seen this hesitation gradually fade, with more clients now willing to downsize, relocate, or move closer to family,” Flood said. “Many are using the equity they’ve built in their current homes to make larger down payments, which helps offset the impact of today’s higher rates.”

The impact

According to the survey, Generation Z buyers fear they’ll never be able to afford a home, especially with the increasingly prohibitive home prices. Additionally, high economic uncertainty and fear of a possible recession have fueled anxieties among younger homeowners.

Flood said that the concern younger buyers feel is understandable, but purchasing a home sooner can still be a strong option.

“Over the past 25 years, home prices in Austin have steadily increased by about 5% per year, with no significant drops in value aside from the brief correction following the pandemic surge,” Flood said. “This long-term growth suggests that if you can afford the payments and plan to stay in the home for at least a few years, buying sooner... can be a smart financial move. “