Millennials are increasingly pessimistic about homeownership. Only 21% of millennials believe their generation can afford to buy homes in 2025, a steep drop from 52% in 2024, according to research from Real Estate Witch, a publication owned by Clever Real Estate.
The median U.S. home price is hovering around $420,000, but 68% of millennial buyers are targeting homes priced under $400,000 in 2025—a notable rise from 57% in 2024. However, affordability challenges remain front and center, with 96% of millennial buyers expressing concerns about the home-buying process.
Financial hurdles dominate: 52% point to high home prices, 48% cite elevated interest rates, and 44% report struggling to save for a down payment. As a result, many millennials are exploring unconventional options, with 41% willing to buy a home that has asbestos or pest issues, and 57% ready to invest in fixer-uppers.
Barriers to Homeownership
Nearly all millennials (97%) report facing obstacles to buying a home. High home prices and interest rates top the list, with 74% believing that 2025 is a poor time to purchase due to soaring borrowing costs. Still, 76% would reconsider if mortgage rates were to drop this year.
Despite affordability concerns, some millennials remain committed to entering the housing market. Over half (56%) are prepared to offer above the asking price on a home, though this figure is down from 79% in 2024.
Regret is also a common sentiment among millennials, with 67% wishing they had purchased homes when prices were lower. As many as 32% expect to max out their budgets in 2025, illustrating how financial pressures are shaping the homebuying process.
Unusual Preferences and Trade-Offs
Financial challenges are also driving millennials to make unexpected compromises. About 34% of millennials say they are willing to buy a home near a cemetery, while 26% would consider one near a railroad track. Surprisingly, more millennials are open to these options than living near an ex-partner (25%) or even their in-laws (60%).
The willingness to accept fixer-uppers and homes with issues like asbestos or pests reflects the growing difficulty of finding affordable, move-in-ready properties in today’s market.
Generational Perspectives on Housing Challenges
Millennials also feel their generation faces the greatest challenges to homeownership, with 45% saying their obstacles are unparalleled. Additionally, 33% blame baby boomers for contributing to the affordable housing crisis.
As home-buying trends evolve, affordability remains the dominant concern for millennials. The group’s willingness to embrace non-traditional housing options underscores the pressure to secure property despite financial and market headwinds.
The post Struggling With Home Affordability, Many Millennials Are Open to Unusual Trade-Offs first appeared on The MortgagePoint.
