Following the Great Recession, many young adults—ages 18 to 34—struggled to become homeowners. The young adult homeownership rate was about 8 percentage points lower than in prior generations. Although this rate slowly increased with economic recovery and historically low interest rates during the COVID-19 pandemic, the homeownership rate among today’s young adults is still 4 to 5 percentage points lower than it was in 2000.

Rising interest rates and elevated home prices are raising challenges for young adults trying to access homeownership. Ultimately, making homeownership affordable for younger households will require both supply- and demand-side solutions. Congress has several tools to help young adults achieve homeownership and build wealth, by providing incentives for housing development that is more affordable and by targeting homebuying assistance to first-time homebuyers.