Gen X And The Housing Boom – 24% of Buyers You Can't Ignore

The real estate conversation often revolves around millennials and baby boomers, but there's a crucial demographic being overlooked: Gen X.

Born between 1964 and 1982, Gen X may be the smallest generation by population, but they're punching above their weight in the housing market. Sandwiched between millennials and boomers, Gen Xers are known as the "sandwich generation" for a reason. They're financially supporting their parents and children, yet they're still reshaping how people think about buying, selling and living in today's real estate world.

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Here’s the surprising truth: Despite making up only 19% of the U.S. population, a recent National Association of Realtors report reveals Gen Xers represent 24% of recent homebuyers – and around 60% of Gen Xers already own homes, which have seen significant value appreciation.

"Buyers who purchased homes before the (COVID-19) pandemic have benefited from substantial appreciation in property values," Jenna Stauffer, a global real estate adviser at Sotheby's International Realty, told Realtor.com. "By selling after a few years, they've been able to leverage this equity to move up to more expensive properties, even in this challenging market."

Gen X: The Silent Powerhouses Of The Housing Market

Gen X, often overlooked in the housing market spotlight, is quietly making significant strides. As the second-highest-earning generation with an average annual income of $126,900 in 2023, they've ascended the career ladder and built substantial wealth. This financial success has allowed them to purchase larger homes, averaging 1,940 square feet – the second-largest home size among all generations.

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However, this financial power comes with its share of challenges. Gen X carries the heaviest debt burden of any generation, with an average of $45,557 in student loans and $278,935 in mortgage debt.

Fortunately, according to Freddie Mac, many Gen Xers secured historically low interest rates during the 2000s and early 2010s, averaging just 4%.

Financially Strapped Powerhouse Reshaping Housing

The low-rate advantage is both a blessing and a curse. As current interest rates hover around 7%, many Gen Xers find themselves locked into their homes, unable to justify refinancing to a higher rate despite changing life circumstances.

Gen X is making waves in the housing market despite the challenge of being squeezed between aging parents and adult children. A 2022 Pew Research Center survey found that 54% of Gen Xers financially support a parent or child, hindering their ability to move, upgrade or pay off their homes. In fact, 30% of Gen Xers believe the financial burden has made homeownership impossible, according to Realtor.com.

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The multigenerational financial squeeze has fueled the rise of multigenerational households – homes where multiple adult generations coexist. With rising prices and tough job markets, many young adults are back to living with their parents.

Many aging parents also prefer the closeness and support of family. Around 60 million Americans live in multigenerational households, a fourfold increase in the past 50 years.

Gen X is adapting to the trend. According to the National Association of Realtors, 19% of Gen X homebuyers seek multigenerational homes with features like separate entrances, soundproofing or accessibility modifications to ensure privacy and independence for each generation.

Realtor.com also found that 30% of Gen X homeowners received financial help from parents or children to purchase multigenerational homes. This intergenerational financial support reflects Gen X’s challenges and savvy resourcefulness in the housing landscape.

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Gen X's Golden Years

As Gen Xers enter their 60s, they're facing a crucial housing decision: to move, upgrade or stay put. Record-high home equity levels have put them in a powerful position to leverage their wealth, but the question of how to best use this financial advantage remains.

While some Gen Xers are eyeing larger homes to accommodate multigenerational living, others are considering downsizing to reduce expenses as retirement approaches. Those planning to purchase a home should factor in potential future needs, such as accommodating aging parents or adult children.

"We're finding that a lot of (Gen X) are still looking for a bigger home," Angie Golembiewski, a broker at Baird and Warner in Crystal Lake, Illinois, told Realtor.com. "Maybe they've put off moving for some time because of affordability or raising children. But even though we are in that approaching empty nester type of lifestyle, we do see that some of the Gen Xers are moving up still and looking for bigger homes."

She also cautions that there isn't a perfect time to buy – waiting for interest rates to drop could mean prices rise with increased demand.

"If it makes sense to be with your family, near your family or to downsize to decrease expenses, do it," she said.

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Real estate is a great way to diversify your portfolio and earn high returns, but it can also be a big hassle. Luckily, there are other ways to tap into the power of real estate without owning property. Arrived Home's Private Credit Fund’s has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate. The best part? Unlike other private credit funds, this one has a minimum investment of only $100. 

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