Housing shortage: GenZ first since 1950s to lose confidence in housing market

The housing shortage is widening the generation gap in the housing market. Gen Z is much more concerned about their housing options than baby boomers and is also much more likely to need help buying a home, according to research by ING. Gen Z is the first young generation since the 1950s to lose confidence in entering the housing market.

According to ING, homeownership in the Netherlands became increasingly normal in the decades following the post-WWII reconstruction. “This trend is being broken with Gen Z,” researcher Wim Flikweert said.

55 percent of Gen Z worry about whether they will ever be able to afford a home. 58 percent expect that they’ll have to continue making compromises on their housing needs. Millennials are not in a much better space, with 55 percent worried about affording a home and 53 percent expecting continued concessions. Gen Z and millennials are also more likely to indicate that they have made sacrifices to be able to buy a home, such as sacrificing free time to work more.

Of the people in Gen Z who have managed to buy a home, almost a third needed help from their parents or other family members. Among millennials, a fifth needed help. Gen X and baby boomers hardly needed assistance in affording a home, with only 7 percent and 6 percent, respectively, getting help from third parties.

A full three-quarters of boomers and Gen X indicate that purchasing their first home was perfectly feasible. “Previously, you could buy a home with one income. Now you see that two incomes are needed,” Flikweert said. “Moreover, a large proportion of the post-war generation still lives in the house they bought back then. That first home was suitable for getting married and having children. If first-time buyers can buy a house now, it might be 40 square meters, and they’ll have to move again.”

According to Flikweet, there are some similarities between young first-time buyers today and the boomers of the past. “You see a somewhat ironic parallel between the post-war generation and the current one. There was also a shortage then, but the boomers’ perspective was different than now. They knew that construction was happening. Now it’s deadlocked; things aren’t moving forward.”