The fast-rising costs of owning a home have some young Americans questioning whether buying a house is still a good investment.
Take Tony Zhang, 34, who bought a $950,000 townhouse in Irvine, California in 2021 and says he now regrets it. The supply-chain manager says investing his down payment of roughly 30% in the stock market instead would have left him with a portfolio worth as much as $1 million today.
“Had I just taken my down payment and bought Meta, Nvidia or any growth stock, I probably wouldn’t even be working my 9-to-5,” he said. Even with a more conservative investment that mirrored the S&P 500, he estimates he’d have an extra couple of hundred thousand dollars. In the meantime, renting a comparable two-bedroom apartment in his area would be about $800 cheaper than his $4,300 monthly housing costs, which don’t include maintenance.
Zhang is among many people under 40 who feel that homeownership isn’t the wealth-building tool it used to be. Less than a quarter of Americans aged 18 to 39 say buying a home is a very good investment, compared with 38% of those over 60 years old, a recent survey by the Pew Research Center found. A further 38% of under-40s see property as a “somewhat good” place to park their money.
A separate survey by the Federal Reserve Bank of New York found the proportion of under-50s who consider housing to be a “very good” investment had fallen to about 16% in February, from about 25% five years earlier.
