Millennials hit hardest as US homeownership rates fall across all ages, AEI report finds

Key facts

• In 2000, 69% of 40-year-olds owned a home; by 2022, that fell to 58%.
• Homeownership among 20-year-olds dropped from 9% in 2000 to 5% in 2022.
• At age 59, ownership fell from 83% in 2000 to 77% in 2022.
• The national median home price reached $415,450 in March.
• The American Enterprise Institute analyzed data from the New York Fed for the report.
• Millennials aged 36 to 48 saw the steepest ownership decline over the past decade.
• Realtor.com senior economic research analyst Hannah Jones warned of widening wealth gaps.

Homeownership declines across all age groups, not just the young

from the American Enterprise Institute challenges the common assumption that housing affordability pressures primarily delay younger buyers. Analyzing data from the New York Fed, the think tank found that homeownership rates have fallen across the entire age spectrum up to 59 years old. "The mistake is to assume that affordability pressures mainly delay younger buyers," the report states. "In reality, they reduce homeownership across the entire age distribution." Between 2000 and 2022, the share of 40-year-olds who owned a home tumbled more than 10 percentage points, from 69% to 58%. This age group, typically at the peak of their careers, experienced the sharpest decline.

Millennials bear the brunt of the housing crisis

While no age group has been spared, millennials—those aged 36 to 48—have been hit hardest. Over the past decade, their homeownership rates dropped more than any other cohort. For younger adults, the situation is even starker. In 2000, 9% of 20-year-olds owned a home; by 2022, that figure had plummeted to just 5%. The trend persists even for older Americans: at age 59, ownership fell from 83% to 77% over the same period. underscores that the crisis is not confined to first-time buyers or the young, but is eroding homeownership across generations.

Wealth-building vehicle out of reach for many

The decline in homeownership has profound implications for wealth accumulation. "Homeownership has historically been the primary vehicle through which American middle-class families build and transfer wealth," said Hannah Jones, senior economic research analyst at Realtor.com. She warned that if lower- and middle-income households never accumulate home equity, they miss out on appreciation and have nothing to pass down—no down payment gift for a child, no paid-off home for retirement. The compounding effect across generations could meaningfully widen the wealth gap between homeowners and renters for decades to come, Jones added.

National median home price tops $415,000

The backdrop to these trends is a national median home price of $415,450 in March. past two decades have made homeownership increasingly unattainable. The AEI report, based on U.S. Census Bureau and AEI Housing Center data, shows that ownership rates for all ages from 18 to 59 have dropped as home prices surged. Even older millennials and Gen Xers, who might be expected to have more financial stability, are finding it harder to buy.

Wider wealth gap looms as home equity becomes hereditary

The erosion of homeownership threatens to create a self-perpetuating cycle of inequality. Without home equity, families cannot provide down payment assistance to their children, making it harder for the next generation to buy. Jones highlighted that the inability to transfer wealth through housing could exacerbate the divide between those who own and those who rent. The report's findings suggest that without policy intervention, the gap will only widen, as fewer households build the wealth that homeownership traditionally provides.

The bottom line

• Homeownership rates have fallen for all age groups up to 59 since 2000, with the steepest decline among 40-year-olds.
• Millennials aged 36 to 48 experienced the largest drop in homeownership over the past decade.
• The national median home price reached $415,450 in March, contributing to the affordability crisis.
• used New York Fed data to analyze ownership trends.
• Economists warn that declining homeownership will widen the wealth gap between owners and renters across generations.
• Without home equity, families lose a key vehicle for wealth transfer, affecting future generations' ability to buy homes.