Dreams Dashed: The Harsh Reality of Chasing Homeownership in America

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Owning a home is often seen as the epitome of the American Dream.

Long associated with financial security, stability, and generational wealth for many families around the nation, homeownership was synonymous with success.

But in today’s economy, this traditional view of the “American Dream” has become harder to achieve than ever before.

Rising home costs and an uncertain job market have made it more difficult for people to purchase their own homes, even those who had been saving for years.

Today, we will examine a survey of 1,000 American renters about their thoughts on how buying a home remains challenging despite our improving economic climate.

We will also look at what individuals can do to make owning a house achievable once again. 

Let’s crunch some numbers and see how you can work towards making your dream of homeownership come true.

76% Can’t Afford A Home

The survey found that 76% of respondents cannot purchase a home due to large down payments or other financial considerations.

This is an alarming statistic for those looking to find stability in their future.

1 in 3 Don’t Consider Homeownership Part of The American Dream

Even though homeownership can provide stability and wealth creation, 1 in 3 respondents did not consider it a part of their American Dream.

This issue could be due to their current financial situation or lack of understanding about how to achieve it.

85% of Renters Want To Buy A Home

However, there is hope; 85% of renters want to purchase a home.

If given the tools and resources, many Americans could become homeowners.

28% Gave Up On The American Dream

Unfortunately, 28% of respondents gave up on their American Dream due to financial constraints or a lack of understanding.

This is why it’s important to stress the importance of education and preparation when planning for homeownership.

32% of Gen Z Don’t Believe in the American Dream

Interestingly, Gen Z is less likely to believe in the American Dream.

This could be because they are the first generation to come of age during a recession and have had more financial struggles than their parents.

Regardless, it’s important to encourage them to pursue their dream of homeownership as long as they are prepared and educated on what it takes.

Later Generations Will Never Reach The Rates That Boomers Had

The homeownership rates for later generations will never reach the same levels that baby boomers had.

Boomers could purchase homes without significant debt or savings, whereas today’s buyers need at least 20% down and good credit to even be considered.

It takes longer for modern buyers to save up enough money to put a down payment on a house, which is why it’s so important for them to start saving early and stay committed throughout their journey.

86% Believe Homes Are Too Expensive

Eighty-six percent of millennials believe homes are too expensive, and 72% think they can never afford a home.

Making matters worse, these same people also face increased rent costs due to competition for rental units in popular cities.

With rising home prices and wages that aren’t keeping up, it’s no wonder many millennials feel homeownership is out of reach.

71% Value A Debt-Free Life Over Owning A Home

Seventy-one percent of millennials value a debt-free life over owning a home, so they need to think about how they can pay off their student loans and other debts before considering buying a home.

Creating a budget that accounts for day-to-day expenses, saving money wherever possible, and paying down high-interest loans first are a few things that can help.

72% Can’t Afford the Down Payment

While many generally struggle with payments, 72% cannot afford the down payment on a home, which can be anywhere from 3-20% of the total cost. 

Homeownership isn’t out of reach for everyone, though many people opt for a loan with a lower down payment or take advantage of government programs that make it easier to purchase a home.

Most Believe They Deserve To Be A Homeowner

Despite financial hardships, 83% believe they deserve to be homeowners.

It’s not impossible to become a homeowner, even with student loans or other debts, but prospective buyers need to do their research and plan ahead to ensure that they can afford the purchase in the long term.

With proper planning, any person can become a homeowner.

71% Underestimate The Price Of A Home

Many potential buyers don’t realize that the total cost of a home goes beyond just the price. You’ve got closing costs and other fees to consider, too.

Surprisingly, the survey found that 71% underestimated the actual home cost.

Most people think the average home cost will be around $398k, but in reality, it’s sitting at $525k.

85% Of Renter Blame Inflation

The survey also found that 85% of renters believe inflation is the main reason they can’t afford a home.

Rising prices and stagnant wages make it challenging for people to save enough money to make a down payment on their dream house.

How to Save For a House While Renting

It can be tricky to figure out how to save for a house down payment while you rent.

But when you follow some simple steps, the process becomes much easier.

Here are the steps to follow to get you out of an apartment and into a house.

SAVE FOR A HOUSE WHEN RENTING

Why Being House Rich Cash Poor Is Financial Suicide

We all want to buy the perfect home, but paying too much can have a disastrous impact on our money.

Here are the reasons why buying too big of a home can destroy you financially.

HOUSE RICH CASH POOR

Pros And Cons of Buy vs Rent

It’s an age old debate. Should you buy a house or rent an apartment.

At the end of the day, the decision is a personal one. You have to decide which option makes the most sense for you.

To help you decide, I put together this guide on the pros and cons of buying vs renting.

BUY VS RENT PROS AND CONS

How To Pay Your Mortgage Off Early

If you have a mortgage, you know the monthly payment can be annoying. You pay and pay and yet it feels like your balance never goes down.

That all ends now. Here are the best ways to pay off your mortgage early, in some cases, in half the time.

BEST TRICKS TO PAYING OFF YOUR MORTGAGE EARLY

Pros and Cons of a 30 Year Mortgage

When it comes to buying a house, most people opt for a 30 year mortgage. But just because everyone else gets one, that doesn’t mean it is right for you.

Learn the pros and cons of a 30 year mortgage to know if it makes sense for you.

10 PROS AND CONS OF A 30 YEAR MORTGAGE

The data for this study can be found here.