It’s not a secret that many Millenials and Gen Z-ers struggle to buy homes. Home affordability has been an issue for Americans during my entire career of real-estate reporting — and it was a problem long before that.
A new report from real estate company Redfin showed that as of Q3 2025 (the most recent data available), older homeowners held more real estate wealth than ever. Homeowners age 70+ possessed 26% of the real estate wealth in the country. Ten years ago, they held 21.6%, and 20 years ago, they had 16.6%.
With 35.3%, those ages 55-69 still had the most wealth from homeownership in the country. However, the 70+ age group is the only generation of homeowners that has consistently gained wealth over time, according to Redfin.
High home prices and low mortgage rates have kept baby boomers in their homes
Baby boomers’ real estate wealth is growing because they are staying in their houses, which are gaining value over time, noted Redfin chief economist Daryl Fairweather.
Mortgage rates plummeted to 3% and lower during the peak of the Covid pandemic. This helped many Americans buy a house, and for baby boomers who were already homeowners, it allowed them to refinance into a lower rate.
This resulted in the “lock-in effect,” which involves homeowners staying in place rather than selling because they don’t want to lose the great mortgage rate they’ve locked in. And as home prices increased, baby boomers could use that value to access cash through second mortgages or age in place.
Younger homebuyers face less home affordability
Fairweather pointed out that higher home prices and mortgage rates — the very same factors that have set baby boomers up for success — have made homeownership unaffordable for younger would-be buyers.
Baby boomers (understandably) don’t want to sell their homes, which means fewer houses are on the market, and homebuyer demand exceeds supply. When there are more people wanting to buy homes than homes for sale, the competition drives up home prices.
More about affordability and the housing market:
- Fannie Mae predicts shifts in mortgage rates, housing market
- Trump signs 2 executive orders to improve home affordability
- Redfin reveals why now is the right time to refinance a mortgage
Mortgage rates are currently hovering around 6%. Historically, this isn’t bad.
Interest rates may never return to the sub-3% range again, though, so young homebuyers can’t take advantage of the rock-bottom rates that existed just a few years ago.
Housing could become more affordable for young buyers this year
It isn’t all bad news for Millennials and Gen Z-ers, though. Redfin listed reasons to believe that homeownership could become more affordable in 2026.
- In December, Redfin published its forecast for the 2026 housing market and predicted that income growth would surpass house price growth. If Americans earn more money and home prices slow down, they could afford to buy.
- The latest Redfin report pointed out that the average 30-year fixed mortgage rate is a little over 6%, just a little higher than its recent three-year low.
- According to Freddie Mac, the current 30-year rate is 6.11%. This is 0.64% lower than this time last year and 0.33% under the 52-week average.
