Is the American Dream Impossible? 60% of Americans Say They Don’t Feel Capable of Owning a Home

Housing Costs Help Keep Inflation Running Hot — (Photo : Photo by Spencer Platt/Getty Images) A sign advertising units for rent is displayed outside of a Manhattan building on April 11, 2024 in New York City. As consumer inflation remained high last month, Americans are seeing steep increases in the price of rent, home, gas and food among other essential items. The continued rise in inflation means that the Federal Reserve is unlikely to cut interest rates anytime soon.

Homeownership may now seem impossible for many Americans, as over 60% said they do not feel financially capable of owning a home.

As of August, a home in the US sold for a median price of $433,229. To comfortably afford a median-priced home, hopeful buyers must earn at least $80,000 annually. However, the average American worker earns $1,143 per week, which totals to only $59,436 per year as of the second quarter of 2024, according to data from the US Bureau of Labor Statistics (BLS).

In comparison, the average monthly rent is $1,406, per the recent American Community Survey.

Can Americans Afford a Home in Today's Market?

With those numbers in mind, Lance Surety Bonds surveyed 1,013 renters across the US and asked whether they thought owning a home is still possible in today's market. At least 66% of Americans said they don't feel capable of owning a home and believe renting is currently the only viable option.

Gen Z respondents had the bleakest outlook on homeownership by generation, with 75% saying they see renting as the only option in today's housing market. In comparison, only 68% of millennials, 64% of Gen Xers, and 53% of baby boomers shared a similar sentiment.

Why Americans Prefer Renting To Owning a Home

In addition, the Lance Surety Bonds study also asked participants whether they are still planning to buy a home in the future. One in eight respondents said they plan to rent indefinitely, with baby boomers (37%) most likely to skip buying a home.

Furthermore, the study asked participants why they preferred renting to owning a home. The top answer (53%) was the inability to afford a down payment. For perspective, the conventional down payment (20%) for a median-priced home would be $86,645.

Other reasons cited by respondents for preferring to rent included high mortgage rates (43%), desire for flexibility in living arrangements (35%), preference for less responsibility (33%), and belief that housing costs are more expensive for homeowners than renters (29%).

Conversely, 71% of Gen Zers said they plan to buy a house.