Millennial Home Buyer Report: 2026 Edition

Barriers to Homeownership | Home-Buying Budget | Mortgage Rate Expectations | Affordable Housing Solutions | Savings vs. Debt | Delaying Home Buying | Buying a Fixer-Upper | Millennial Homeowner Regrets

Millennials have always faced a tough road to homeownership. They entered adulthood weighed down by student debt and low starting salaries in the aftermath of the Great Recession. Then the pandemic hit, pushing home prices — and subsequently interest rates — to new highs. 

As if conditions weren't bad enough, now millennials must contend with new tariffs driving up the cost of home construction and maintenance. At this point, even giving up avocado toast, cold brew, and beloved houseplants wouldn't help them afford the massive expense of homeownership. 

Still, millennials are motivated to buy a home in 2026 for a number of reasons, including needing more space (42%), building long-term wealth (28%), and wanting a family (20%). But just 22% say they want to buy because they have enough money saved, according to our recent survey of 1,000 millennial home buyers. 

We found that 61% of millennials say buying a home makes them feel in over their heads financially, but 40% are desperate to make a home purchase in 2026 — leading to questionable decision making. 

A majority of millennials say they would not take the simple step of cutting spending on gym memberships (77%), subscription services (71%), or coffee (67%) to afford a home. Instead, they'd rather make risky money moves that could jeopardize their financial future. 

If it meant they could buy a home, 44% of millennials would be willing to spend half of their monthly income on housing, and 49% would consider accepting an interest rate above the current level of 6%.

To learn more about this cohort of buyers, we asked 1,000 millennials about their priorities, plans, and anxieties when purchasing a home in 2026. We compared this data with previous years to provide a clear snapshot of millennials’ home-buying experience — and the obstacles that stand in their way.

Millennials Say Expensive Homes, High Interest Rates Are Top Barriers to Homeownership

It's a tough market for millennial home buyers as limited inventory, rising home prices, and high interest rates have put homeownership increasingly out of reach. 

Even as interest rates drop, tariffs have increased the cost of building and maintaining homes, creating new financial hurdles that continue to make it difficult for millennials to enter the market. 

In fact, 97% of millennials say they have at least one barrier to homeownership, with first-time and repeat buyers equally likely to have barriers.

Expensive homes are the No. 1 barrier to homeownership — with 46% of millennials saying high prices hinder them from buying — but all the most common obstacles are financial in nature:

• Homes are too expensive (46%)
• Interest rates are too high (40%)
• Saving for a down payment (34%)
• High property taxes (30%)
• A lack of available homes in their budget (25%)
• Qualifying for a mortgage (21%)
• A lack of income (20%)

These hurdles feel particularly high to cost-conscious millennials buying for the first time. They are twice as likely as repeat buyers to say:

• Saving for a down payment is a barrier (42% of first-time buyers vs. 21% of repeat buyers)
• Qualifying for a mortgage is a barrier (28% vs. 11%)
• A lack of income is a barrier (26% vs. 11%)

The expensive and competitive market that makes it difficult for first-time buyers to purchase a home makes it just as challenging for repeat buyers to upgrade, though.

While facing many of the same financial pressures, repeat buyers (41%) are slightly more likely than first-time buyers (39%) to say high interest rates are a barrier — especially if they are reluctant to give up a low rate they locked in during their previous home purchase.

Half of First-Time Millennial Buyers Would Spend 50% or More of Their Monthly Income on Housing to Buy a Home

In light of these daunting financial barriers, it's no surprise 96% of millennials have concerns about purchasing a home. The most common concern is finding an affordable home, cited by nearly 1 in 3 millennial home buyers (30%). 

Finding an affordable place to live is no easy task when the median U.S. home costs $410,800. More than half of millennials say they can't afford that, with 59% planning to spend less than $400,000 on their home purchase.

First-time buyers are particularly budget conscious, with about two-thirds (67%) intending to purchase a home that costs less than $400,000 and a third (34%) wanting a home that costs less than $200,000. For comparison, just 45% and 13% of repeat buyers aim to purchase that low, respectively.

Instead, millennial homeowners are looking at higher price brackets thanks to the profit they'll likely make from their sale. About 55% of repeat buyers aim to purchase a home that costs $400,000 or more, and 40% plan to purchase a home that costs $500,000 or more. That's 1.5x and 2x the percentage of first-time buyers who say the same, respectively.

Although 61% of millennials say purchasing a home makes them feel in over their heads financially, 40% admit they are desperate to purchase a home in 2026. 

Some are so desperate they would spend more than the recommended 28% of their gross monthly income on housing. In fact, 44% of millennials, including 50% of first-time buyers, would spend more than half of their monthly income to afford a home.

With buyers going to financial extremes to become homeowners, it's no surprise 65% of millennials regret not buying a home when prices were lower.

Even Experienced Buyers Feel the Strain of Today’s Housing Market

The struggle to find affordable housing often heightens millennials’ overall financial concerns. In addition to finding a budget-friendly home, many of millennials' top home-buying concerns are also financial in nature:

• Not being able to find an affordable home (30%)
• Unexpected or hidden costs of homeownership (28%)
• Fear of overpaying or making a bad financial decision (28%)
• Not being able to find a home that meets their needs (25%)
• Not being able to afford a mortgage (23%)
• Having to make major repairs (22%)

Although repeat buyers have the advantage of experience and home equity when purchasing their home, they are just as likely as first-time buyers to have concerns — albeit, different ones. 

For example, first-time buyers are roughly twice as likely as repeat buyers to fear hidden costs of homeownership (33% vs. 20%) and that their down payment will be too small (24% vs. 12%). Meanwhile, repeat buyers (17%) are slightly more likely than first-timers (14%) to worry about a housing market crash that could impact the equity they have in their home. 

Ultimately, today's market presents challenges to all millennial buyers, and those who have previously purchased a home remember how difficult it was as they brace for another tough process.

About 89% of repeat buyers say they faced significant challenges when purchasing their first home. The most common challenges were:

• Saving for a down payment (22%)
• Finding a suitable property (17%)
• Expensive home prices (16%)
• High interest rates (16%)
• Competing with other buyers (9%)

Half of Millennials Would Only Accept a Mortgage With an Interest Rate Lower Than the Current Level

High home prices are problematic for cost-conscious millennial buyers, but they're only part of the problem. Millennials must also contend with high mortgage rates that increase the cost of borrowing and the overall cost of purchasing a home. 

About 40% of millennials say high interest rates are a barrier to homeownership in 2026, although that's down from 46% who said the same in 2025 as rates have slowly begun to fall.

Today's mortgage rates hover around 6.2% after dropping from 6.9% a year ago. However, they're still nearly double the historically low rates buyers enjoyed at the height of the pandemic market in 2020. 

It's no wonder 68% of millennials think current interest rates make it a bad time to buy a home, and 61% regret not buying a home when they were lower. Yet 78% of millennials say the possibility of lower mortgage rates in 2026 would entice them to buy. 

Although the Federal Reserve is expected to cut interest rates in 2026, it is not expected to be a significant drop — to the dismay of many millennials who may be naively holding out hope for rates that aren't realistic. 

A majority of millennial home buyers (51%) would only consider a mortgage if it came with an interest rate of 6% or less.

This is especially true of repeat buyers, who may currently have a low rate they don't want to give up. About 61% of them would only consider a mortgage rate of 6% or less, compared to 46% of first-time buyers.

Meanwhile, a staggering 49% of millennial home buyers, including 55% of first-time buyers, would consider accepting an interest rate of more than 6% — adding thousands of dollars to their monthly mortgage payment and putting them in a financially precarious position. 

A Majority of Millennials Would Prefer a Market With Lower Interest Rates but More Competition

Declining interest rates can make home buying more affordable but not necessarily easier. If interest rates decline, millennials who have been priced out may enter the market, increasing competition for homes. 

Although 1 in 5 millennials (20%) say buyer competition is a barrier to homeownership, they'd rather contend with other buyers than shoulder additional expenses from high mortgage rates.

A majority of millennials would prefer a market with lower interest rates and more buyer competition (56%) over a market with higher interest rates but less competition and more negotiating power (44%). 

With potential rate drops on the horizon in 2026, about one-fourth of millennials expect bidding wars with other buyers (23%) and having to make offers on multiple homes (28%).

To beat the competition, nearly two-thirds of millennials (64%) would be willing to offer above the asking price on their next home — up from 56% in 2025. 

However, offers above asking price will likely be modest in comparison to the extreme bidding in the wake of the pandemic. Buyers are most likely to offer less than $25,000 (40%) over asking price or less than $10,000 over asking price (21%) if they were to bid more.

Meanwhile, high home prices mean some millennials simply can't afford to offer above the asking price. More than 1 in 3 millennials (36%) would only offer the asking price or below.

Consequently, many millennials feel uncertain about their ability to compete. About 1 in 5 (20%) aren't confident they can make a competitive offer in this housing market.

Millennials Blame High Mortgage Rates for the Affordable Housing Crisis, Say They Need Financial Help to Buy a Home

Rising costs, elevated mortgage rates, and limited inventory all contribute to the affordable housing crisis, but millennials say high interest rates (29%) are chiefly to blame, followed by the federal government (26%) and corporations (22%).

Nearly two-thirds of millennials (66%) go so far as to say political policies in 2025 have worsened the housing market, and three-fourths (74%) say they would support policies that limit corporations from buying family homes.

With these conditions stacked against them, millennials don't feel particularly hopeful about their chances of owning a home. 

Approximately 72% of millennials say homeownership is still part of the American dream, but 75% don't think the average millennial can afford a home, and 41% think they'll be the last generation in their family to afford a home purchase. 

Nearly all millennials agree homeownership isn't a feat they can achieve alone under current conditions. About 97% say they'll need some sort of help to afford homes, with only 3% saying their generation just needs to try harder. 

Millennials say the following would most help them buy a home:

• Lower home prices (59%)
• Lower interest rates (55%)
• Higher wages (48%)
• Government assistance (32%)
• More home inventory (26%)
• Reduced investor competition (21%)

3 in 4 Millennials Would Not Cut Spending on Gym Memberships, Subscription Services to Afford a Home

Although lower home prices and interest rates are largely out of millennials' control, there are steps they can take to help themselves buy a home. More than 1 in 3 millennials (34%) say homeownership would be more affordable if they had better spending habits.

To afford a home, 90% of millennials say they're willing to reduce their spending, including on key costs such as education (9%), medical care (8%) and child care (6%). 

A majority of millennials, however, are unwilling to give up their daily indulgences to be able to afford a home:

• 77% would not reduce their spending on gym memberships.
• 71% would not reduce their spending on subscription services.
• 67% would not reduce their spending on coffee.
• 65% would not reduce their spending on concerts and events.
• 63% would not reduce their spending on travel or vacations.
• 63% would not reduce their spending on alcohol.
• 54% would not reduce their spending on dining out.

Even though millennials won’t part with gym memberships, subscription services, and other nonessentials, almost 1 in 5 (18%) say they’d stop donating to charity if that’s what it takes to buy a home.

Whether they're cutting back on charitable donations or life's little luxuries, it's unlikely to make a significant impact on their ability to afford a home. Even if a millennial gave up their daily coffee — saving about $1,300 a year — it would still take about 61 years to afford a 20% down payment on the median-priced home with those savings alone. 

With that logic, 1 in 10 millennials (10%) say they wouldn't cut any expenses to afford a home.

Almost Half of Millennials Have Been Saving for a Home for at Least 5 Years but Still Fall Short of Down Payment

Millennials may be selective about how they save, but they are generally pleased with their progress. More than half of millennials (53%) think they have enough saved for a down payment on a house. 

Yet their confidence doesn't reflect reality. Many millennials are thousands of dollars short of what they actually need for a down payment. 

A 20% down payment on the median-priced home would cost a little over $80,000, but 72% of millennials don't even have $75,000 in savings. More than half of millennials (55%) also fall short of the $40,000 they would need to put down 10% on the median-priced home. 

Millennials remain off track despite the fact that nearly half (47%) have been saving for a home for five years or more.

During that time, home prices climbed faster than their savings could grow — especially as inflation has made everyday living more expensive. It's no wonder 61% of millennials plan to put down less than 20% on a home rather than chase an ever-growing target. 

While it's no surprise 66% of first-time buyers, with their limited savings, plan to put down less than 20% on their home, it may come as a shock that more than half of repeat buyers (52%) also plan to do the same.

When repeat buyers were purchasing their first home, about one-fourth (22%) said the most challenging part was saving for a down payment. For many, their first down payment was likely so small they still lack 20% equity. 

Nearly 1 in 4 Millennials Have More Debt Than Savings

Millennials have likely struggled to save because of their staggering debt burdens. In fact, 24% of millennials have more debt than they do savings.

About 75% of millennials have non-mortgage debt, with 46% carrying at least $10,000 — up from 38% who owed that much last year as inflation and tariffs have forced millennials to borrow more to make ends meet. 

What's more, 1 in 5 millennials (23%) owe at least $30,000, and more than 1 in 6 (16%) owe at least $50,000.

So much debt has millennials worried about their ability to secure a mortgage needed to purchase a home. About 1 in 5 millennials are concerned they won't qualify (20%), saying it's a barrier to homeownership (21%). 

Even if they do qualify for a mortgage, about 1 in 4 millennials (23%) are worried they won't be able to afford it, especially with existing debt contributing to a higher rate.

More Than Half of Millennials Have Delayed Home Buying for at Least 3 Years Amid Unfavorable Market Conditions 

Financial concerns have prevented many millennials from entering the housing market, with nearly 1 in 4 (24%) saying they are waiting to buy a home until they have enough money saved. 

But personal finance concerns aren't the only factor holding millennials back. More than half (57%) say they are worried the real estate market will get better for buyers after they purchase a home, prompting many to wait for better conditions. 

Millennials have put off buying a home because:

• They are waiting for home prices to drop (19%)
• They are waiting for the perfect home, regardless of market conditions (18%)
• They are waiting for interest rates to drop (17%)

Overall, 2 in 3 millennials (67%) have delayed their plans to buy a home because of the housing market. 

Yet waiting for the market to improve has proved largely futile, with many millennials waiting years for changes that have never materialized. Of those who delayed their plans, more than half (56%) have put off buying a home for at least three years, while nearly a quarter (23%) have put off buying for five years or more.

First-time home buyers, who are particularly sensitive to the market's high prices, are the most likely to try and wait it out. About 63% have waited three years or more, while 27% have waited five years or more.

Rather than wait indefinitely for better market conditions, about 1 in 4 millennials (22%) say they will buy as soon as they find an affordable home.

This includes 24% of first-time home buyers, compared to just 19% of repeat buyers who can afford to wait for the right property. In fact, repeat buyers (26%) are 2x more likely than first-time buyers (13%) to say they will wait to buy the perfect home, regardless of market conditions.

Half of Millennials Would Buy a Home With Pests, Asbestos

Buying an affordable home in this market often means considering properties that need a lot of improvement. 

Despite nearly 1 in 4 millennials (22%) worrying about having to make major repairs, 55% of millennials, including 58% of first-time buyers, would be willing to purchase a fixer-upper. 

Buying a fixer-upper can come with a wide range of potential problems, but millennials are surprisingly willing to take on these harmful hazards:

• 51% of millennials would buy a house with pests, such as cockroaches, mice, or spiders.
• 50% would buy a house with asbestos.
• 49% would buy a house with a leaky roof.
• 48% would buy a house with foundation issues.
• 47% would buy a house with termites.
• 43% would buy a house with mold.

Although purchasing a fixer-upper may seem like a budget-friendly option, they often hide costly surprises — causing homeowners to continually spend money on unexpected repairs.

Millennials who have previously owned a fixer-upper know firsthand the time, money, and stress involved in making repairs. About 1 in 7 millennial homeowners (14%) now regret buying a distressed home and are more likely to avoid those properties in the future: 

• 46% of repeat buyers would purchase a home with asbestos, compared to 53% of first-timers.
• 45% of repeat buyers would purchase a home with termites, compared to 49% of first-timers.
• 43% of repeat buyers would purchase a home with a leaky roof, compared to 53% of first-timers.
• 42% of repeat buyers would purchase a home with foundation issues, compared to 51% of first-timers.

First-time millennial home buyers are generally more willing to overlook red flags in a home, but the one factor they’re (36%) more likely than repeat buyers (29%) to deem a dealbreaker is high utility costs.

Monthly expenses may be a bigger concern to first-time buyers with tighter budgets, whereas repeat buyers — who have equity from a previous home — may view high utility costs as simply a drawback rather than a dealbreaker.

Millennials Would Consider Living Near Planes, Trains, and Party Houses to Afford a Home

Millennials seem to value the safety of their neighborhood much more than the structural integrity of their home. Millennials may not be deterred by a leaky roof or crumbling foundation, but an unsafe neighborhood is the top dealbreaker, with 59% saying they would not purchase a home in a dangerous area.

Millennials won't compromise on safety, but they'll overlook all kinds of other inconveniences in the surrounding area. Although 57% of millennials say a good location is a priority, if it was the only home available in their budget, millennials would buy a property next to:

• A cemetery (26%)
• A vacant or abandoned property (25%)
• A railroad track (17%)
• A busy highway (15%)
• A stadium or concert venue (15%)

First-time millennial buyers — who prioritize an affordable home (56%) over a good location (54%) — are much more willing to risk purchasing a home in a subprime spot. For example, they are nearly three times more likely than repeat buyers to consider purchasing a home next to a fraternity or sorority house (11% vs. 4%) and two times more likely to purchase a home next to a nightclub (12% vs. 6%). 

Still, millennials would rather tolerate these noisy and inconvenient neighbors than the awkwardness of living next door to an old fling. Millennials are more likely to consider living next door to a railroad track (17%) and a busy highway (15%) than their partner's ex (12%).

What's more, 84% would not consider living next to their own ex, and 69% would not consider living next to their in-laws.

Interestingly, repeat buyers (34%) are more likely than first-time buyers (28%) to consider living next to their in-laws. Having already owned a home, they likely recognize the benefits of having trusted family nearby to babysit, pick up a package, or watch the house while they're away.

In the end, about 1 in 6 millennials (16%) regret compromising on location for a home in their budget, and 1 in 7 (14%) regret buying in a bad location. As a result, repeat buyers are more concerned about finding the right location (63%) over finding an affordable home (49%).

More Than 8 in 10 Millennial Homeowners Have Regrets About Their Purchase

Millennials often take risks to buy a home, overlooking certain red flags they assume won't matter. However, many of those decisions can become a source of regret over time. 

Although 82% of first-time millennial home buyers are confident they will have no regrets about their home after purchasing it, the same percentage of millennial homeowners (82%) have at least one regret about their previous home purchase.

Millennials are most likely to regret:

• Outgrowing their home too quickly (20%)
• Compromising on location for a home in their budget (16%)
• Rushing the purchase (16%)
• Bad neighbors (15%)
• A lack of education about home buying (15%)

Millennials' Most Desired Home Features

Roughly 1 in 6 millennial homeowners (15%) regret buying a home that lacks their most desired features. But it is a common compromise millennials often have to make to afford homes.

Millennials begin their home search looking for properties that have a large yard (33%), an attached garage (30%), and extra bedrooms (26%). 

These are millennials' most coveted home features and, consequently, the ones they are least willing to give up to afford a home. Millennials are least likely to sacrifice an attached garage (19%), followed by a large yard (17%) and extra bedrooms (15%). 

Millennials are far more likely to part with community amenities (30%), a finished basement (26%), and dedicated home office space (23%). Not surprisingly, these features are at the bottom of millennials' priority list, with fewer than 10% saying they are a must-have.

Methodology

Clever Real Estate conducted a poll of 1,000 American millennials who indicated they plan to buy a home in 2026. The respondents were asked about their home-buying plans, their views on homeownership, and their financial situation. The poll was conducted Oct. 9 to Nov. 1, 2025.

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