Gen Z homebuyers head to Cincinnati, Indianapolis, other Midwestern cities

Jim Weiker, The Columbus Dispatch
·2 min read
Gen Z buyers accounted for about 10% of home purchases last year on average, but more in many smaller cities.
Gen Z buyers accounted for about 10% of home purchases last year on average, but more in many smaller cities.

Members of Generation Z, the latest crowd to enter the housing market, are heading toward affordable mid-size cities, including many in the Midwest, for their first homes.

According to a new study by the online mortgage platform LendingTree, four of the top 10 most-popular cities for Gen Z homebuyers are in the Midwest, led by Cincinnati at #4, Indianapolis at #5, and Minneapolis at #7.

The Columbus area, where the housing market has been shattering records, landed at #14.

Gen Z, whose members are between 10 and 25 years old, are relatively new to the housing market but accounted for 10% of mortgages offered by LendingTree in the country's 50 biggest metro areas last year, the study found.

In some metro areas, however, they accounted for a far bigger share of the market.

Gen Z buyers made up 16.6% of mortgages in Salt Lake City, Utah, the metro area with the biggest Gen Z impact.

Following Salt Lake are Louisville (15.7% of mortgages), Oklahoma City (15.3%), Cincinnati (14.3%) and Indianapolis (14.1%). In Columbus, Gen Z buyers accounted for 11.6% of mortgages and in Cleveland, they accounted for 9.9%.

Smaller, more affordable cities in the middle of the country dominated the top of the Gen Z list while expensive coastal cities were least popular, presumably because of their cost. In San Francisco, Gen Z buyers accounted for 3.6% of the market; in New York City, 4.1%; and in San Jose, California, 4.5%.

The report noted that rising home prices and rising interest rates may take some would-be Gen Z buyers out of the market altogether this year. In the Columbus area, interest rates and home price hikes have pushed the monthly payment on a typical home up nearly $500 from a year ago.

"Even though buying a home can be a good choice for some Gen-Zers, that doesn’t mean that all members of the generation should feel pressured to immediately become homeowners," said LendingTree's Senior Economic Analyst Jacob Channel, who also wrote the report.

"Nor does it mean that those who can’t necessarily afford a home right now are somehow behind their peers or making bad financial decisions. Homebuying is a highly personal choice and the time at which it is right can vary significantly from person to person."

jweiker@dispatch.com

@JimWeiker

This article originally appeared on The Columbus Dispatch: Gen Zers turn to Ohio and other Midwest states for their first homes