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By Giulia Carbonaro
Senior Reporter
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A growing number of young Americans are losing faith that they will ever be able to buy a home, squeezed by rising rents and stubbornly high home prices that have barely eased even as demand cools.
Nearly 23 percent of renters under 40 say they do not plan to buy a home or are unsure they ever will—up from 18 percent a year ago—according to a new survey by real estate marketplace Bright MLS.
This shift does not reflect waning interest in homeownership: almost 90 percent agree that homeownership remains central to the so-called 'American Dream', according to the survey. They just fear they will never be able to afford it.
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Economic Anxiety Is Growing, Especially Among Young People
Bright MLS surveyed more than 3,000 U.S. consumers in December 2025 about their economic outlook for the new year, including their thoughts on housing affordability, mortgage rates and their plans to buy or sell a home.
It found that economic anxiety was spreading all across the country, impacting people’s decision to buy or sell a home—with young people being particularly disheartened.
More than three‑quarters of respondents said they were worried about having to cut back on spending, while two‑thirds feared job losses and 57 percent of homeowners were concerned about making mortgage payments.
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Those worries were most acute among renters, lower‑income households and millennials.
More than 80 percent of renters said they were “somewhat” or “very” worried about having to cut back on essential spending this year, compared to 73.2 percent of homeowners.
The same concern was expressed by 82 percent of households earning less than $50,000, compared to 70 percent of households earning $100,000 or more, and by over 80 percent of millennials, who are aged between 30 and 49.
Housing costs are a central driver of that anxiety.
More than nine in ten Americans surveyed said affordability is a problem, with a majority pointing to insufficient wages and high mortgage rates as the main barriers to buying.
The impact is visible in market data: the share of first-time homebuyers falling to a historic low of 21 percent between July 2024 and June 2025, according to the National Association of Realtors (NAR).
Within the same period, the average age of the typical U.S. first-time homebuyer also climbed to 40—an all-time high.
A Light At the End of the Tunnel?
Affordability is expected to improve slightly this year as wage growth will finally outpace home price growth, bringing some—though not all—would-be buyers off the sidelines of the market.
In its 2026 forecast, NAR experts said that a one percentage-point drop in mortgage rates this year could expand the pool of households who can qualify to buy by about 5.5 million households, including about 1.6 million renters who could become first-time buyers.
Despite recent declines, mortgage rates remain a major source of concern for renters hoping to step onto the property ladder. Roughly 75 percent of renters wishing to purchase a home and 87 percent of homeowners who might sell told Bright MSL that rates would need to fall below 5 percent for them to act.
But few believe they will do so—and experts agree. While now lower than they have been in three years, mortgage rates are still double what they were during the COVID-19 pandemic.
As of February 12, the average 30-year fixed-rate mortgage was 6.09 percent, according to Freddie Mac. A majority of experts expects rates to hover around the 6 percent mark through the end of the year—which suggests the standstill in the U.S. housing market might endure.
Home prices, while rising only modestly compared to the double-digit increases reported between 2020 and 2022, are still inching up and remain much higher than they were before the pandemic. As of January, the latest Redfin data available, the median sale price of the typical U.S. home was $423,261, up 1.1 percent from a year earlier.
Meanwhile, rent costs are also still rising at the national level, making it harder for renting households to save enough to buy a home. The median cost of rent on a primary residence in the typical U.S. city was $441,285 in January, according to the Consumer Price Index, up from $440,189 in December and $429,087 a year earlier.
While all of this should contribute to make young Americans feel gloomy, there are also figures that suggest many of them might benefit from the expected improvements in affordability this year.
In the fourth quarter of 2025 already, the homeownership rate for individuals under 35 improved from 36.3 percent at the end of 2024 to 37.9 percent, according to Census Bureau data. It was only one of two age groups seeing an increase, together with Americans aged between 55 and 64.
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