And how buying a home seems like a very unattainable dream.
Growing up in an immigrant family taught me that owning a home was a milestone of success, the ultimate piece of the American Dream. But as a Gen Z (born 1997-2012) New Yorker, I’m convinced that dream is out of reach—not only for myself but most of my generation.
If you take a little stroll on TikTok, you might stumble upon @dangeloruff, where the creator has made several viral videos speaking to Boomers (1946-1964) and Traditionalists/Silent Generation (born 1928-1945). He often starts a conversation by asking how much they paid for their houses. "$37,000," says one. "$12,500," says another. To Gen Zers like me, these numbers sound like fiction. Today, the nation's average house costs $412,300 with a 6.32% interest rate.*
In the 1960s, 70s, 80s, and even 90s, many of these homeowners purchased their homes at significantly lower rates, and over time, their value rose sharply. In the 1980s continuing into the 1990s, a wave of conservatism led by former Presidents Ronald Reagan and George W. Bush led to the deregulation of the housing market, creating large housing bubbles where boomers either bought homes for next to nothing or sold them for huge profits.
But it’s not just home prices that have ballooned—other essential expenses like student loans have crushed Gen Z's (and Millenials!) financial prospects. Today, the average student loan debt stands at $37,853 per borrower, with private loan debt totaling $128.8 billion. This is money that should be going toward saving for a home, and expenses that previous generations never had to shoulder.
Where are today's politicians in all this? You can find them on Twitter at each other's throats, blaming each other for the current situation, as Gen Zers and Millenials continue to suffer.
Republicans have consistently resisted any form of housing market intervention, instead prioritizing tax cuts—for the wealthy—not the struggling, and ignoring the average American struggling to afford a home.
The same can be said for the Democrats. Countless promises for social safety nets, home ownership subsidies, and student loan forgiveness programs (including Joe Biden and Kamala Harris' new student loan forgiveness program, which was recently blocked) have seldom been fulfilled. They’ve also consistently failed to address the deeper issues that keep housing out of reach for my generation.
As I approach graduation in two years, I look at the current housing market with complete despair. Current wages are abysmal— and as a reminder, the federal minimum wage still sits at $7.25. As a New Yorker, my current minimum wage is $16/hour, while the median rent for a studio apartment sits at $3,050 a month. Despite the fact that taxes remain high, especially in New York where the tax rate can reach 10.94% which is among the highest in the country, they seem to provide little tangible benefit to the average American, particularly for Gen Z. Healthcare is generally only for those who are in the lowest income bracket, Pell grants are among the only government-funded education assistance, and even just general education appears to be untouched by the high tax rates. Much of the tax revenue seems to be put towards places that do not address the real, urgent needs of younger generations.
The score between Gen Z vs homeownership is currently 27-0 as if we were expected to start saving every penny the moment we were born. As housing prices skyrocket, the burden of student debt expenses, and high taxes that don’t benefit us, it certainly feels like the odds are stacked against us.
*30-year fixed-rate.
Photo Credit: Canva
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