Why Was One Generation Able to Buy Two Homes and the Next Generation Will Not Be Able to Buy Any? Multidimensional Analysis of the Generational Gap in Access to Real Estate

1. Introduction

Homeownership has historically been at the heart of the economic and social aspirations of families in Western countries. In the post-war US and European context, access to home ownership represented the axis of what was called the “ownership society”: a broad-based model of wealth accumulation that constituted the main vector of wealth creation for the middle class (Arundel & Ronald, 2021; Lersch & Dewilde, 2018). During the 1950s and 1990s, exceptional macroeconomic conditions (rising real wages, accessible mortgage credit, abundant land supply, and permissive regulatory frameworks) allowed entire generations not only to access their first home, but also to accumulate sufficient real estate assets to acquire additional properties or transfer them intergenerationally.

Table 1 presents the characterization of each generational cohort with their conditions of access to the real estate market, allowing the identification of structural change in market entry variables over seven decades.

This paradigm has undergone a profound and accelerated transformation in the last three decades. Data from the U.S. Census Bureau (2022) reveal an unequivocal trend of deterioration: while in 1960 40% of those born in that decade were homeowners at the age of 30, only 27% of those born in 1980 reached that condition at the same age. In California, an emblematic state of contemporary housing tensions, the rate of ownership between 18 and 30 years of age fell from 25% in 1960 to 15% in 2020 (LAO, 2021). Table 2 documents this contraction in ownership rates in young adults (25–34 years) in selected developed economies, evidencing the global dimension of the phenomenon.

This trend is not an exclusively American phenomenon. The European Central Bank (ECB, 2022) has documented similar patterns in European economies, concluding that generations born after 1980 have significantly lower rates of real estate ownership than their predecessors at equivalent ages, regardless of the individual economic life cycle. In a longitudinal analysis of house prices in 14 countries over the period 1870–2012, Knoll et al. (2017) identified an unprecedented acceleration of real house prices from the second half of the twentieth century, consistently outpacing the growth of disposable income.

Table 3 systematizes the evolution of the main macroeconomic indicators that condition access to real estate by decade in the United States, allowing us to visualize the progressive decoupling between house price growth and household disposable income.

Contemporary academic literature identifies a constellation of determining factors in this gap: the stagnation of real wages in the face of asset inflation; the accumulation of student debt as a barrier prior to mortgage savings; zoning regulatory frameworks that restrict housing supply; and the long-term effects of financial crises (especially the Great Recession of 2008–2009) on access to credit and initial capital formation (Ballard Brief, 2023; IFS, 2023). At the same time, cultural and demographic transformations (postponement of marriage, prioritization of vocational training, greater labor mobility) have modified the life cycles in which access to real estate is feasible (ECB, 2022).

Despite the breadth of the literature on housing affordability, a relevant analytical gap persists: the absence of integrated frameworks that simultaneously articulate the economic, regulatory, social, and technological dimensions of the problem, recognizing its systemic and not merely circumstantial nature. Existing studies address each dimension in a predominantly isolated way, making it difficult to understand the interactions and synergies between factors.

This study seeks to close this gap through a multidimensional analysis of the determinants of intergenerational disparity in access to real estate. The objective is to identify, organize and synthesize the structural factors that explain why previous generations were able to accumulate real estate assets while current generations face increasing obstacles to even accessing the first home, and to propose implications for public housing policy aimed at restoring intergenerational equity.

2. Methodology

2.1. Study Design

The study adopted a qualitative analytical-documentary approach, complemented by statistical-descriptive synthesis of secondary data. This design is appropriate for the stated objective (the construction of a comprehensive analytical framework on the generational gap in access to housing) as it allows the critical integration of knowledge from diverse disciplines: housing economics, urban sociology, public policy, and data sciences (Groat & Wang, 2023; Creswell & Poth, 2018). The nature of the problem (structural and multisectoral in scope) justifies the choice of this approach over experimental or quasi-experimental designs, which would be insufficient to capture the complexity of the phenomenon.

2.2. Sources of Information and Selection Criteria

The Scopus, Web of Science (WoS), JSTOR, and Google Scholar databases were consulted, preferably limiting the search to the period 2017–2026, including seminal reference works from previous periods when their conceptual relevance justified it. Statistical data from primary institutional sources were also integrated: U.S. Census Bureau, California Office of Legislative Analysis (LAO), Urban Institute, European Central Bank (ECB), U.S. Department of the Treasury, and Institute for Family Studies (IFS).

The keywords used, in Boolean combination, included: generational homeownership gap; housing affordability; millennials housing access; zoning reform housing; student debt homeownership; housing policy intergenerational equity. Searches were conducted in English and Spanish.

The inclusion criteria were: (a) articles in Q1 or Q2 indexed journals (Scopus/WoS); (b) reports from international or governmental organizations of recognized methodological authority; (c) academic monographs with more than 100 citations in the specialized literature. The exclusion criteria applied were: (a) gray literature without peer review or verifiable institutional affiliation; (b) opinion articles without empirical support; (c) sources prior to the year 2000 not classified as seminal references in the field. After the application of these criteria and the evaluation of thematic relevance, 22 sources were integrated into the final analysis.

2.3. Analytical Procedure

The analysis was structured in three sequential stages. Stage 1 consisted of a thematic analysis with inductive coding of the revised texts, identifying emerging categories around five axes: (i) historical evolution of real estate ownership, (ii) economic factors, (iii) social and lifestyle factors, (iv) regulatory frameworks and public policies, and (v) impact of technology on the purchase process. The procedure followed the protocol of Braun and Clarke (2006).

Stage 2 involved a statistical-descriptive synthesis in which the quantitative data available in institutional sources were systematized, constructing a comparative matrix of indicators of housing affordability, property rates by generational cohort, and evolution of the price-income relationship. Stage 3 consisted of the integration and construction of the multidimensional analytical framework through the articulation of the patterns identified in the previous stages, subjected to triangulation of sources to verify their coherence with independent specialized literature.

2.4. Reliability and Validity

The reliability of the analysis was ensured by triangulation of sources (academic, governmental and independent institutional) and internal consistency of the arguments developed. Constructive validity was ensured by explicitly anchoring each component of the proposed analytical framework in empirical evidence documented in the reviewed literature. The inherent limitations of desk analysis (focused on written production and data from secondary sources) are explicitly acknowledged in the Discussion section.

3. Results

3.1. Historical Developments in Real Estate and Housing Policy

Historical analysis allows us to articulate the trajectory of real estate in three different phases. The first phase (1930–1960) was marked by federal intervention in housing: the National Housing Act of 1934, the creation of the Federal Housing Administration (FHA), and the systematic encouragement of mortgage credit laid the foundations for the postwar “homeowners society” (Erickson, 2009). During this period, real estate was consolidated as the main mechanism of wealth accumulation for middle- and working-class families, with property rates exceeding 60% of households by the end of the 1950s.

The second phase (1960–2007) was characterized by sustained market expansion driven by the Baby Boomer population boom, accelerated urbanization, and the availability of mortgage credit at affordable rates. Knoll et al. (2017) document that real house prices in OECD countries grew at an average rate of 3.5% per year since 1970, generating significant wealth returns for the owning generations and simultaneously widening the barrier to entry for subsequent cohorts.

The third phase (2008–present) is marked by the disruption caused by the Great Recession of 2008–2009, whose collapse of the subprime mortgage market generated a wave of foreclosures, permanently tightened credit standards, and eroded young generations’ confidence in the housing market as a safe investment vehicle (Urban Institute, 2022; Ballard Brief, 2023). House prices recovered and surpassed their pre-crisis highs, while credit requirements remained more restrictive, creating a structurally unfavorable scenario for first-time buyers.

3.2. Economic Factors Determining the Generation Gap

Price-to-Income Ratio

The most widely used indicator to assess housing affordability is the ratio of median house price to median annual household income. The available data show an unequivocal deterioration: this ratio increased from 6.1 in 2000 to 8.5 in 2021 (Ballard Brief, 2023). In practical terms, the IFS (2023) estimates that young adults between the ages of 20 and 34 would need an increase in income in the order of USD 225,000 per year to access the median price of housing in the main metropolitan markets of the United States, a figure that far exceeds any reasonable salary expectation for this age group.

Wage Stagnation

Between 1979 and 2019, labor productivity in the United States increased by 61.8%, while real median compensation grew by only 17.5% (Economic Policy Institute, cited in Ballard Brief, 2023). This dissociation between productivity and income implies that current generations work more productively than their predecessors, but receive a proportionally smaller proportion of the value they generate, reducing their savings capacity and, consequently, the formation of the initial capital necessary to enter the real estate market.

Student Debt Load

The expansion of access to higher education in the Anglo-Saxon model has implied the accumulation of student debts that compromise the ability to save during the years of greatest potential for the formation of initial mortgage capital. The average student debt for college graduates exceeds $37,000, significantly limiting their ability to accumulate the down payment required to access conventional mortgage loans (U.S. Census Bureau, 2022; IFS, 2023).

3.3. Social and Demographic Factors

The analysis shows that social factors act both as direct conditioning factors and as mediators of economic effects on access to property. Empirical research indicates a statistically significant correlation between household formation (marriage, birth of children) and the decision to own a home. The ECB (2022) documents that post-1980 generations consistently postpone marriage and parenthood compared to previous generations, thus differing the motivation to access real estate.

However, the IFS analysis (2023) qualifies this interpretation: among those under 35 years of age who aspire to have children, more than 90% express the desire to own a home, indicating that postponement responds to a greater extent to economic conditions than to a genuine change in preferences. Affordability pressures have also generated significant internal migration flows: between 2020 and 2023, high-cost metropolitan regions recorded a net migration of 2.6 million people to lower-cost regions (IFS, 2023). This phenomenon, while relieving pressure on source markets, tends to shift the affordability crisis to previously more balanced markets.

The ability to access family transfers for down payment is an increasingly important differentiating factor. As the wealth gap between owning and non-owning generations is amplified, the advantage of the children of owners over those of tenants in the real estate market increases, configuring a mechanism for the reproduction of inequality (Arundel & Ronald, 2021; Lersch & Dewilde, 2018).

3.4. Regulatory Frameworks and Public Policies

The analysis of the regulatory dimension reveals a fundamental paradox: the territorial policy instruments originally designed to guarantee urban quality have contributed, in many contexts, to aggravating the housing affordability crisis. Single-family residential-only zoning ordinances, in place in most U.S. metropolitan areas, structurally limit residential densification and, therefore, the supply of housing in the markets with the highest demand.

The 2020 President’s Economic Report estimated that excessive land-use regulations generate housing premiums of the order of 50–100% in markets such as Los Angeles and San Francisco compared to what would result in more permissive conditions (HAR, 2023). The IFS (2023) estimates that moderate densification enabled by zoning reforms could increase housing supply by 20–40% in the most restricted markets. Federal housing assistance programs (Community Development Block Grants, housing vouchers, FHA mortgage insurance) have provided essential support to demand, but have faced criticism for indirectly financing localities with restrictive regulatory frameworks that counteract their effects on affordability (IFS, 2023).

3.5. Impact of Technology on Housing Access for Young Generations

The digitization of the home buying process has generated relevant transformations in the experience of Millennial and Gen Z buyers. Platforms such as Zillow, Redfin, and Trulia have democratized access to market information previously concentrated in specialized intermediaries, reducing the informational transaction costs of the purchase process (US Assure, 2023). The possibility of carrying out georeferenced searches, accessing price comparables and requesting virtual visits has substantially modified the patterns of search and evaluation of homes.

Financial technology (fintech) has expanded the spectrum of financing options for first-time buyers, including mortgage comparison platforms, digitized down payment assistance, and co-ownership models facilitated by online platforms (HAR Blog, 2026). However, these innovations have not solved the structural affordability gap, but have facilitated access within the segment of buyers who already meet the minimum financial requirements. A U.S. Assure survey (2023) indicates that 46% of Millennial and Gen Z shoppers identify affordability as the top barrier, while a significant segment underestimates non-mortgage costs (insurance, taxes, maintenance), exposing themselves to post-acquisition financial pressure.

3.6. Comparative Synthesis: Housing Affordability Indicators by Generational Cohort

Table 4 summarizes the main indicators of housing affordability for the different generational cohorts in the United States, systematizing the findings reported in the reviewed literature.

4. Discussion

4.1. Theoretical Implications for Housing Economics and Intergenerational Welfare Theory

The findings of the present study have theoretical implications of significant scope for the field of housing economics and intergenerational well-being theory. The systematic pattern of deterioration in housing affordability documented in Table 4 makes it possible to overcome monocausal explanations of the phenomenon (focused exclusively on cyclical factors or changes in individual preferences) and postulate the existence of a structural dysfunction of the housing market in advanced market economies.

Arundel and Ronald (2021), in a comparative analysis of 25 OECD countries, argue that the “ownership society” model that dominated the twentieth century was possible thanks to unrepeatable historical conditions: low land prices, massive access to subsidized mortgage credit, lower wage inequality, and regulatory frameworks favorable to residential expansion. The progressive erosion of these conditions explains why access to property has been transformed from a de facto social right into a privilege of the generations and social classes that already possessed it.

This perspective aligns with the “wealth trap” thesis formulated by Lersch and Dewilde (2018), who empirically demonstrate that real estate property acts as a mechanism for self-accumulative wealth accumulation: owners not only accumulate wealth through asset appreciation, but such wealth allows them to facilitate access to the same market for their descendants. generating a cycle of reproduction of advantage that progressively excludes those who do not start from a patrimonial base. From the perspective of intergenerational equity, the contemporary real estate market thus constitutes a mechanism for the transfer of wealth from young generations to owners, through house prices, rents and returns on real estate capital (Christophers, 2023).

4.2. Practical and Public Policy Implications

The results generate direct implications for the formulation of more equitable housing policies. First, evidence on the impact of zoning restrictions indicates that land-use regulatory reforms represent one of the public policy interventions with the greatest potential to increase the supply of affordable housing without compromising the fiscal balance of public administrations. The reforms implemented in California, Oregon, and New Zealand in the period 2019–2023 offer policy laboratories whose systematic evaluation can provide valuable evidence on the effectiveness of this approach.

Second, down payment assistance programs (direct subsidies, equity loans, or mortgage guarantees) are revealed as instruments with high potential for impact on the segment of first-time buyers whose only barrier is the formation of initial capital, and not the ability to service long-term mortgage debt. Third, the findings of the study are relevant to the Latin American context: factors such as the supply deficit due to regulatory restrictions, the stagnation of real wages and limited access to formal mortgage credit are recognizable in economies such as Peru’s, where the quantitative housing deficit exceeds 30% and access to mortgage credit is restricted to a fraction of the working population (MVCS, 2021).

4.3. Comparison with Existing Literature

The results of the present study are consistent with the findings of the international literature. Knoll et al.’s (2017) analysis of the acceleration of real house prices since 1970 provides the long-term macroeconomic rationale that explains the trend identified in the cohort data. Arundel and Ronald’s (2021) research on the decline of «owner societies» in Europe complements this perspective with comparative evidence on the structural nature of the phenomenon.

A point of tension with some of the literature lies in the interpretation of the role of changes in generational preferences. Some authors argue that a fraction of the decline in property rates genuinely reflects changes in preferences toward greater mobility and residential flexibility. However, the results of this study are consistent with the majority position in the literature: IFS (2023) data on the aspiration of real estate ownership among people under 35 years of age with family aspirations (>90%) indicate that latent demand is high, and that the gap between aspiration and fulfillment is mainly attributable to economic barriers and not to a genuine change in preferences. Regarding the technological dimension, the results coincide with the conclusion of US Assure (2023): technology can reduce the transaction costs of the purchasing process, but it cannot compensate for the structural affordability gap.

4.4. Limitations of the Study

The present study has limitations that must be explicitly recognized. Firstly, the documentary and statistical-descriptive analysis adopted does not allow us to establish causal relationships between the factors identified and the evolution of real estate ownership rates; Identification of causality would require more advanced quasi-experimental or econometric designs. Second, the empirical evidence reviewed comes mainly from the American and, to a lesser extent, European context, limiting the direct extrapolability of the findings to contexts of less institutional development. Third, the period of analysis does not fully capture the effects of interest rate hikes that began in 2022–2023, which have intensified barriers to access to mortgage credit even in historically more balanced markets.

5. Conclusions

This study has systematized the available evidence on the determinants of the generational gap in access to real estate, demonstrating that it is a phenomenon of a structural nature, the result of the interaction of economic, regulatory, social and technological factors that act synergistically to progressively exclude young generations from the housing market.

The first conclusion is that the generation gap is not the result of changes in individual preferences, but of a systemic transformation of the housing market that has eroded affordability at an accelerated rate. The price-to-income ratio has climbed from 3.5–5.0 for Baby Boomers to 7.5–9.5 for Millennials and Gen Z, while the share of affordable housing markets has fallen from 97% in 1969 to 41% in 2022.

The second conclusion is that regulatory zoning restrictions constitute one of the most significant amplifying factors of the crisis, by limiting the supply of housing in the markets with the highest demand. Land-use deregulation reforms therefore represent one of the public policy interventions with the greatest potential for medium-term impact.

The third conclusion is that the accumulation of student debt and wage stagnation act as a double barrier prior to mortgage savings, delaying or preventing the formation of the necessary initial capital. Addressing these two dimensions in an integrated manner is a necessary condition for housing policies to achieve their purpose of expanding intergenerational access to property.

The fourth conclusion is that technology, although it has democratized access to market information and has expanded financing options, does not solve the structural affordability gap and can deepen inequalities if it is not accompanied by adequate financial skills in first-time buyers.

5.1. Recommendations

For legislators and public policy bodies:

• Push for zoning deregulation reforms that enable mixed residential densities in high-demand metropolitan areas, evaluating models implemented in New Zealand, Oregon, and California.
• Design down payment assistance programs focused on first-time buyers from the 1981–2012 cohorts, articulated with long-term ability to pay assessments.
• Explore rent-to-own schemes and subsidized co-ownership models as intermediate pathways to full ownership, particularly in contexts of highly valued markets.

For financial institutions:

• Develop mortgage products specifically designed for buyer profiles with high payment capacity but low initial capital, including down payment financing schemes linked to public or private participation.
• Implement pre-acquisition financial education programs that address total costs of ownership: insurance, property taxes, and preventative maintenance.

For the academy:

• Develop longitudinal research on the impact of zoning reforms on housing affordability and ownership rates of young generations.
• To deepen the comparative analysis between North American, European and Latin American contexts, identifying the contextual factors that determine the transferability of successful housing policies.

5.2. Future Lines of Research

Impact Assessment of Zoning Reforms: Quasi-experimental studies (differences-in-differences) on the effect of deregulation reforms implemented in the period 2019–2023 on housing prices, housing supply, and first-time buyer ownership rates.

Analysis of the Generation Gap in Latin America: Adaptation of the analytical framework of this study to the Latin American context, identifying the institutional, regulatory and market specificities that amplify or attenuate the generation gap in countries such as Peru, Chile, Colombia and Mexico.

Predictive models of housing affordability: Development of econometric models projecting the price-to-income ratio and ownership rates of current generational cohorts under different public policy scenarios (zoning reform, student debt relief, down payment assistance programs).

Impact of Remote Work and Residential Mobility: Analysis of the effect of the mass adoption of remote work (accelerated by the COVID-19 pandemic) on residential migration patterns and ownership rates of Millennials and Gen Z, with a particular focus on emerging target markets.

Intergenerational Housing Equity Indicators: Proposal and validation of an Intergenerational Housing Equity Index (IEIH) that allows systematic comparison between countries and the evaluation of progress over time, which can be integrated into the indicator systems of the Sustainable Development Goals (SDG 11).