Millennials still believe in the “American Dream” – even if they don’t call it that
The idea of the “American Dream” has been around, seemingly, forever. However, as it pertains to being likened to home ownership, it only goes back to the 1980s.
That is according to author Niall Ferguson, who, in his 2009 book The Ascent of Money: A Financial History of the World, identified the linkage of home ownership to the popular phrase as a status symbol – a way to differentiate between the American middle class and those with lower incomes.
In time though, the notion of recognizing homeownership as the American Dream slowly, but steadily declined.
That’s because as millennials came of age, they seemed to be more apathetic toward the concept of the American Dream, and quickly became known as the rent generation.
Yet, while that still may be the case, a recent survey found that even millennials, who are struggling to buy homes for the first-time in such a competitive marketplace, still strive for the American Dream- they just don’t word it the same way.
Realtor.com conducted a HarrisX survey of more than 800 prospective 2021 homebuyers and found that more than half of them (53%) want to buy a home just so they can say they’re a homeowner, which was the No. 1 reason given.
And while millennials may be more “meta” than their generational counterparts, it actually makes sense.
Millennials are big about investing in the communities where they live, so it would make sense that they would rather own a home in those communities than rent there in perpetuity.
But the conundrum is that while that might be the preference, the reality is it’s really hard for millennials to buy homes right now. The housing market is on fire, and it’s a seller’s market for certain. Bids over list. Homes selling in a matter of days. Sometimes sight unseen or without an inspection.
If a millennial doesn’t already own a home that has been accruing equity or if they’re not independently wealthy, competing for homes is akin to being a guppy in a sea full of sharks when the chum bucket has been dumped overboard by a passing ship.
That said, millennials are resilient. They don’t tend to abandon their desire and many of them (43% according to the survey) spend more than a year searching for a home and getting into one.
They may not call it the pursuit of the American Dream, but it certainly comes across in the same manner previous generations sought to become homeowners for the first time.
Millennials also want space – which is the second biggest reason they want to own a home, according to the survey. This would jive with the flight from city living to suburban living brought on by the COVID-19 pandemic.
While there wasn’t a pandemic that chased people to the suburbs in either the 1950s or the 1980s- when there was similar flight from the cities to the burbs – millennials are also following in their parents and grandparents footsteps by seeking more space.
The challenges though, are well-documented.
According to the survey, 44% of millennials haven’t yet purchased a home because they don’t have enough money saved for a down payment. An additional 34% said they haven’t been able to find a home within their budget. With the housing stock at an all-time low nationwide and listing prices increasing by double digit percentages each month for six months, finding a home is going to be that much harder for the first-time homebuyer.
Methodology: Realtor.com® commissioned HarrisX to conduct a national survey of consumers. The total sample size was 830 adults. The survey was carried out online. The figures are representative of all U.S. adults (aged 18+) who were identified as likely first-time buyers. The sampling margin of error of the survey was +/- 3.6 percentage points. Results were weighted for age, gender, region, race/ethnicity and income where necessary to align them with their actual proportions in the population.