How Boomers Robbed Millennials of The American Dream

The American dream has always been characterized by a beautiful home, lush yard, and a white picket fence to boot. Home ownership was a key aspect to this dream – having a place to call your own, make your own, and build a family in.

At one point in history, owning a home was even considered a right. Many of our founders believed that property was something every citizen had a right to. In 1862, the Homestead Act ensured every head-of-household had the right to 160 acres of land as long as they were willing to tend to it. 

This idea that home ownership was something entitled to every American persisted for a long time. Over the course of American history, especially after the Great Depression and surrounding the New Deal, property rights have become less important in the public eye and even in legislation. It is now considered more of a pursuit than a right, which has negatively impacted prospective homeowners in today’s generation.


Boomers and Home Ownership

Boomers and Gen Xers were perhaps the last generations to truly experience this American dream in mass. Between 1940 and 1990, homeownership rates grew from just 43% to 64%. Policies in the 60’s and 70’s made it easier for them to buy homes, allowing home ownership levels to continue growing and ultimately reach an all-time high.

Construction boomed in cities like New York and San Francisco. Automobile industry growth and the infrastructure boom led to the rise of the suburbs, and the rise of suburban development. Huge homes were built everywhere, and in a thriving economy, wealthy families grabbed them up. 

And then, things started to shift. Regular homeowners become greedy, buying 2nd or even 3rd homes and renting them out as landlords. Initially, this rental process was considered a pathway to the American Dream. But now? People are stuck renting. Although home ownership rates are currently healthy, the average home buyer’s age has gone up from 30 years of age in the 1980’s to 47 in 2019.

Where Did the Wealth Go?

So, Boomers made wealth. Gen Xers made wealth. Both of these generations were able to keep their wealth through home ownership. Meanwhile, Millennials faced the worst odds ever. The internet exploded in the 2000’s, which had a major impact on the economy. In 2008, a global financial crisis arrived which majorly impacted the US housing market. 

This recession had intense ramifications for millennials, who experienced higher unemployment rates, lower savings, and consequent lower rates of home ownership. Now, in 2020, COVID is wreaking havoc on the economy and on many young people’s livelihoods. It seems all the bad luck hit millennials at all the wrong times – and has made growing personal wealth and property next to impossible. Wealth has largely stayed with the older generations, while the younger generations fight to keep up rent and live paycheck to paycheck.

These younger generations are now stuck making rent payments to their boomer landlords. The median monthly rent is currently $1,710, and on average it takes 11-12 years of renting before millennials are ready to buy a home. For millennials and Gen Z renters, that means somewhere between $202,000 and $226,000 are flushed down the drain in rental payments before even considering home ownership! Nevertheless, many young people still hope to own homes sometime in their future.

This issue is only going to get worse. Wall Street has caught onto the trend – and they are now becoming the landlords. By avoiding paying taxes by using strategies like the 1031 rollover, the wealth is able to stay concentrated with the wealthy while the young and struggling fork over their livelihood to pay rent.


How Do We Get Out!?

The only way to stop the cycle is to stop renting and start owning. There are options for down payment assistance, which will help you buy a home even if you don’t have a large amount of money saved up. HomeLLC offers debt-free assistance to help you do just that. We finish off your down payment for you as an investment, not a loan – so you don’t have to worry about interest rates or fees. Just put up 2% of the home value, and we’ll top you off to 20%. 

Now is the time to get out of the rental game and become a homeowner. Your mortgage could actually be lower than your rent! Stop building your landlord’s wealth every month and start building your own by paying off your mortgage on your first home. 


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