A Generational Shift in Homebuying Power
The U.S. housing market is going through a major generational shift in 2025. Baby Boomers have now surpassed Millennials as the largest group of homebuyers. This change is reshaping the way Americans buy homes—and who can afford them.
According to the National Association of Realtors, 26% of younger Boomers and 16% of older Boomers purchased homes this year. Meanwhile, only 12% of younger Millennials and 17% of older Millennials did the same. These numbers signal a reversal in market power.
Boomers Leverage Cash While Millennials Rely on Loans
One major reason for this trend is the ability to buy homes with cash. Over half of older Boomers skipped financing entirely. In contrast, more than 90% of Millennials required mortgage loans.
“In a plot twist, Baby Boomers have overtaken Millennials,” said Jessica Lautz, NAR deputy chief economist. “What’s striking is that many Boomers are bypassing financing altogether.”
Cash buyers are dominating the market. They’re beating out younger buyers who face rising interest rates and stricter lending rules. This competition has made it much harder for Millennials to win bidding wars.
Why Boomers Hold the Advantage
Kevin Thompson, CEO of 9i Capital, pointed to the advantage Boomers bring: “Nearly 10,000 Americans turn 65 every day. Many of them are selling long-held homes and entering the market with equity-rich, all-cash offers.”
That equity gives them a serious edge. Alan Chang, a title and escrow expert, explained that homeowners who bought years ago have seen their properties appreciate sharply. This growth allows them to reenter the market with strong buying power.
Meanwhile, Millennials are stuck navigating higher living costs. Many are also burdened with student loans and wage stagnation. Alex Beene, a financial literacy instructor, said, “This data shows how unattainable homeownership has become for younger Americans.”
Market Challenges Continue in 2025
Despite recent interest rate drops, borrowing remains expensive. Rates are still above 6%, and experts say they may only fall modestly by year-end. This environment continues to squeeze first-time buyers.
Berkshire Hathaway Home Services says the market is slow, with high prices and low inventory. However, there are signs of change. Falling rates may encourage more homeowners to list their properties.
Still, buyers remain hesitant. Affordability continues to be a top concern—especially for those without equity or cash on hand.
Sellers Need Strategy to Compete
To attract interest, experts say sellers need to price homes competitively from the start. Berkshire Hathaway advises listing slightly below market trends in slower areas. Otherwise, long listings can scare off buyers.
Renovations can also make a difference. Zillow reports that renovated homes are shared 30% more online than fixer-uppers. Updated homes stand out in a crowded market, especially when buyers have limited options.
Looking Ahead: Unequal Ground
Boomers are thriving in today’s housing market. They’ve built wealth, hold equity, and often avoid debt. Millennials, on the other hand, face uphill challenges. With fewer financial tools and less time to build capital, they continue to fall behind.
As 2025 unfolds, this generational divide in homeownership shows no signs of slowing. While mortgage rates may offer some relief, the playing field remains far from level.
This content is brought to you by the FingerLakes1.com Team. Support our mission by visiting www.patreon.com/fl1 or learn how you send us your local content here.