Gen Z are buying houses. This is where they are looking for.
Rising mortgage rates and high home prices have been particularly difficult for first-time buyers, especially young adults earning their first paycheck. Many are looking outside of expensive metropolitan areas to find more affordable homes in midsize cities, according to new research.
According to a LendingTree report, the online lending market based in Charlotte, North Carolina, members of Generation Z, identified by the platform as people born between 1997 and 2012, accounted for 10% of homebuyers in the 50 largest metropolitan areas. America in 2021. Researchers scanned mortgage offers to more than 890,000 LendingTree platform users and lone borrowers aged 18-24 as a percentage of the total number of offers. The higher the share of Generation Z requests on a given subway, the higher its ranking.
Salt Lake City tops the list, keeping the No. 1 spot compared to last year, with 16.6% of its mortgage offerings targeting Gen Z borrowers. The city has financial, medical and technology industries as an attraction for young professionals, said Jacob Channel, senior economic analyst at LendingTree.
The study results were dominated by inland cities, as more workers fled the coastal areas. Louisville, Ky., (At 15.9%) rose to No. 2 place from seventh the previous year and Oklahoma City (15.3%) dropped one place to third place. At the bottom were the notoriously expensive coastal towns of San Jose, California. (4.5%), New York (4.4%) and San Francisco (3.6%).
Mr. Channel credited the advent of remote working for Generation Z’s growing interest in smaller cities, but noted in the report that rising interest rates were making home purchases more difficult in 2022 than they were. they would have been in previous years. However, as these buyers age and earn more, they will exert more influence on the domestic housing market.
“They are starting college, starting a career, starting a family,” he said. “I expect them to become a dominant force in the market over the next few decades.”