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These days, it seems everything is expensive. From the price of gas, to the cost of eggs, the US dollar simply isn’t carrying as much weight as it once did. Even politicians are quick to point to the affordability issue, and understandably so: polling conducted by the Independent Center of registered voters found that 67% of respondents listed affordability/inflation as their top concern.
Don’t get me wrong—Americans feel the cost of gas every time they go to the pump. It certainly affects weekly budgeting and an overall sense of economic well-being. But there’s a bigger affordability issue that candidates and our elected leaders fail to address: housing.
I’m a millennial American with two college degrees and a career. Most of my social circle is in the same boat: they completed college and have full-time jobs. Despite what the media wants you to think, we millennials aren’t baristas at Starbucks, nor are we playing Xbox in our parents' basement, complaining about the perceived injustices in the world.
We are following the same path as our parents and doing what our high school guidance counselors said would work. In fact, we are the most educated generation our country has ever seen. And yet, for many of us, the house with the white picket fence, a dog, and two kids is simply not possible.
This is a big deal. According to a Bankrate survey conducted in 2023, nearly three-quarters (74%) of American adults still view homeownership as the main step towards achieving the so-called American Dream. 65% of millennials identified homeownership as a top sign of success.
For us, the issue of home ownership has become so absurd that a sense of gallows humor continues to permeate social media and everyday discussions.
Case in point:
The American Dream is a powerful and motivating concept. It motivated Europeans to pick up their lives and start over in a foreign country. The American Dream is our national ethos. It’s foundational to our national identity and captures the audacious optimism that this country has displayed throughout history.
Homeownership isn’t the end objective of the American Dream; it’s the foundation. Owning a home is not only a way to build financial security and generational wealth, but it also symbolizes an oft-overlooked aspect of the American experience: joining a community.
The basic premise of home ownership is that home values increase over time. Therefore, when you own a home in America, you own an appreciating asset. This is why homeownership is often viewed as the ticket to financial security. For 60 percent of Americans (the middle class), their home makes up the bulk of their wealth.
With something as foundational as purchasing your first home out of reach for so many in my generation, it’s no surprise our concerns turn existential. We wonder about our futures, our place in society, and whether we’ll have a stake in our communities.
In February of this year, the economist Mark Zandi claimed that millennials are feeling “disenfranchised” due to these barriers to home ownership. I know Zandi speaks for many of my closest friends when he talks about these feelings of discontent.
When assessing the root causes of home affordability (or lack thereof) in the US, several contributing factors are present. First, median wages haven’t kept pace with the cost of housing. In fact, the median house price today is more than six times that of the median income.
The housing affordability crisis is also an issue of supply and demand, specifically on the supply side. In recent years, the US Home Vacancy Rate, or the rate of homes available for sale, was at its lowest point since the Census Bureau began collecting data. There simply aren’t many homes available for millennials to buy. Higher interest rates have drastically slowed down the typical churn of the housing market. Many would-be sellers feel trapped in their sub-four percent rates.
According to NewHomesMate co-founder Dan Hnatkovskyy, "First-time home buyers, who are often the most sensitive to interest rates, have had to postpone their home-buying dreams. Those older buyers with more cash on hand can buy down interest rates, or they can absorb a higher monthly payment and are still buying homes across the country.”
Finally, there’s the issue of restrictive zoning laws. These laws determine where homes can and can’t be built, what kind of homes they can be, and how densely they can be built. This ultimately leads to fewer homes being built and fewer homes to buy.
Sure, millennials care about the price of gas. And we think it’s absurd that basic store-brand eggs hit seven dollars a dozen not that long ago. But there are bigger concerns that are worrisome for our generation. Homeownership feels impossible. As a result, many of us are beginning to worry that the American Dream is slipping away.
Republicans and Democrats are fiercely fighting over culture, the mental competence of party leadership, and the future of our democracy. But no one is speaking up for the millennials who are beginning to feel alienated and locked out of society.
A candidate who talks to us about housing affordability will be keenly listened to. With Millennials and Gen Z positioned to become the plurality of voters in the 2024 election, this is a good place to start building the next coalition of voters.
Millennials aren’t radical. Nor are we ignorant. We simply want the same things that our parents' generation had.
The American Dream still sounds pretty alluring, after all…
