By the time members of Generation Z hit their thirties and forties, the housing market could shift in their favor, allowing them to outpace millennial homeownership, according to a new survey of more than 100 economists released Monday.

Conducted by Zillow with data from research firm Pulsenomics, the Home Price Expectations Survey placed the homeownership rate among millennial and Generation X homeowners aged 35 to 44 at 60 percent, down from 66 percent in 2009. The overall homeownership rate clocked in at 64.8 percent, up from 62.9 percent in 2016 but below a 70 percent high in 2004.

After surveying 110 economists and real estate experts, Zillow found that 45 percent of the economists believe homeownership rates will be higher among members of Generation Z when they reach the same 35-to-44 demographic pool in 2035. Thirty-eight percent of economists, meanwhile, said that the homeownership rate would be “somewhat higher” while 7 percent said that it would be “much higher.”

Fifty-five percent of the economist indicted less optimism, saying rates will remain the same or drop lower.

“The uncertainty of housing experts is tied up in the fact that this past decade has been anything but normal,” Zillow Director of Economic Research Skylar Olsen said in a statement. “When experiencing unfamiliar dynamics, we must ask whether we will eventually revert to historic patterns or if pillars like preferences, affordability, policy and technology have shifted sufficiently to make this the new normal.”

Zillow and Pulsenomics

Even with uncertainty plaguing the market, a significant portion of experts believes younger millennials and Generation Zers may have an easier time breaking into the housing market, in part because some expect housing values to even out and the required income-to-mortgage ratio to be less extreme.

At the same time, there is no consensus on just how homeownership rates will change in the years to come. While experts predict that home prices will grow by an average of 2.8 percent in 2020 (lower than the 3.6 percent expected for 2019), factors such as student debt or lack of home supply on the market could shift that equation.

“Our most optimistic group of experts expects 31.2 percent cumulative home value appreciation through 2024, while our most pessimistic group expects a cumulative gain of just 7.8 percent over the same period,” Pulsenomics Founder Terry Loebs said. “In dollar terms, the difference between these equally plausible scenarios is almost $7 trillion in aggregate home equity value. We’ve been conducting this survey for more than 10 years, and this barometer of housing market malaise is now at a record-high level.”

Email Veronika Bondarenko

Are you ready for what the industry holds in 2020? Inman Connect New York is your key to unlocking opportunity in a changing market. At Connect you will gain insight into the future, discover new strategies and network with real estate’s best and brightest to accelerate your business. Create your 2020 success story at Inman Connect New York, January 28-31, 2019.

Agenda | Speakers | Past Connect Videos

Thinking of bringing your team? There are special onsite perks and discounts when you buy tickets together. Contact us to find out more.

Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription