The Housing Market Is Moving in Favor of Gen Z

The American dream of owning a home has never seemed further out of reach for young people. You can hardly blame Gen Z and younger millennials for adopting an economic nihilism that prioritizes the here and now — whether that’s $400 Lola blankets or risky crypto trading — over stashing money away for a down payment.

But there’s an underappreciated cost to this shift in behavior. A recent study by economists at the University of Chicago and Northwestern University highlighted something I’ve long suspected: Dimming prospects for homeownership push households to consume more and make riskier investments (the authors also found evidence of lower effort at work). Such choices, the researchers say, produce “substantially greater wealth dispersion between those who retain hope of homeownership and those who give up.”